False accusations at work can do more than cause embarrassment or lead to termination. When an employer, manager, coworker, or former employer makes false statements of fact about an employee to other people, those statements may sometimes constitute defamation under California law.
Workplace defamation claims commonly arise when an employee is falsely accused of theft, fraud, dishonesty, falsifying records, violence, serious misconduct, or professional incompetence. However, not every false or unfair statement made at work is legally actionable. California defamation law contains important requirements and also limitations that can make workplace defamation claims particularly fact specific.
What Is Workplace Defamation?
California recognizes two forms of defamation:
- Libel generally involves defamatory statements made in writing or another fixed form.
- Slander generally involves defamatory statements made orally.
In the employment context, defamation typically involves a false statement communicated to someone other than the employee that damages the employee’s professional reputation or accuses the employee of serious wrongdoing. For example, a manager who falsely tells other employees that a worker stole company property may present a very different legal situation from a manager who simply says that the worker had a “bad attitude.” The first statement refers to a specific fact that can potentially be proven true or false. The second is much more likely to be considered an opinion.
What Must an Employee Prove in a Workplace Defamation Case?
Although the precise requirements for making a defamation claim depend on the circumstances, important questions generally include:
- Was a statement actually made?
- Was the statement communicated to someone other than the employee?
- Was the statement false?
- Was it a statement of fact rather than merely an opinion?
- Was the statement defamatory or damaging to the employee’s professional reputation?
- Was the statement protected by a legal privilege?
The last question is especially important in employment cases because California law provides significant protection to certain communications between people who share a legitimate interest in the subject (in the employment contest – members of management).
Examples of Statements That May Be Defamatory at Work
Potentially defamatory workplace statements may include false accusations that an employee:
- stole money or company property;
- committed fraud or embezzlement;
- falsified documents or records;
- lied about material business matters;
- engaged in workplace violence;
- committed serious ethical violations;
- engaged in serious professional misconduct; or
- lacks qualifications or competence when the statement makes a provably false factual assertion rather than expressing an opinion.
Whether any particular statement constitutes defamation depends heavily on its precise wording and context. This is one reason why preserving the actual email, text message, investigation report, termination letter, performance review, or other document containing the statement can be extremely important.
A False Accusation Is Not Automatically Defamation
Employees understandably become upset when they are falsely accused of misconduct. But a false accusation by itself does not necessarily create a viable defamation claim. There generally must be a publication of the statement to another person.
For example, if a supervisor falsely tells an employee privately, “I think you stole money,” there may be no publication for purposes of a defamation claim if nobody else heard or received that accusation. However, if the supervisor puts the accusation in an email copied to several managers, discusses it with coworkers, or communicates it to a prospective employer.
You Need Evidence That the Statement Was Actually Made
One of the first questions we ask when evaluating a potential workplace defamation case is:
How do you know the statement was made, what that statement was exactly, and how can you prove it?
There is an important difference between:
“My former coworker personally heard my manager say that I stole money.”
and:
“I think my manager must be telling people that I stole because nobody will hire me.”
The first situation identifies a potential witness with personal knowledge. The second is a speculation.
Useful evidence can include emails, text messages, internal communications, termination documents, investigation reports, reference communications, and testimony from people who personally heard the statement. Before bringing a defamation claim, it is important to identify the actual statement, who made it, who received it, when it was made, and what evidence exists to prove those facts.
Fact Versus Opinion
Defamation generally must involve a false statement of fact rather than merely an opinion.
Statements such as:
- “He stole $5,000 from the company.”
- “She falsified her time records.”
- “He submitted fraudulent invoices.”
are factual assertions capable of being proven true or false.
Statements such as:
- “She was difficult to work with.”
- “He wasn’t a team player.”
- “I didn’t think she was a good manager.”
are much more likely to constitute opinions.
The distinction is not always obvious. Courts consider the words used and the context in which the statement was made when determining whether a reasonable person would understand the statement as asserting an actual fact.
Internal Workplace Communications May Be Privileged
This is one of the most important issues in California workplace defamation cases.
California Civil Code section 47(c) provides a qualified privilege for certain communications between people who share a legitimate interest in the subject of the communication. This privilege frequently arises when managers, human resources personnel, investigators, or other employees discuss alleged employee misconduct internally. Therefore, the fact that an accusation was false does not necessarily mean that an employer will be liable for defamation.
Where the privilege applies, an employee generally must also establish malice sufficient to defeat the privilege. Evidence relevant to malice may include circumstances showing that the person making the statement knew it was false, lacked reasonable grounds for believing it was true, acted with hostility or ill will, deliberately ignored contrary evidence, or otherwise acted for an improper purpose.
This privilege issue is one reason workplace defamation cases require careful evaluation before a lawsuit is filed.
Can an Employer Be Liable for a False Accusation Made During an Investigation?
Potentially, but the circumstances matter. Suppose an employer receives a complaint that an employee stole company property. Management investigates and ultimately reaches an incorrect conclusion that the employee committed theft. The fact that the conclusion turned out to be wrong does not necessarily establish defamation. In fact, if the investigation was conducted reasonably thoroughly and fairly, there is unlikely to be a basis for a defamation claim against the employer who simply decided to follow the outcome of that investigation.
The legal analysis may be very different, however, if evidence shows that a manager fabricated the accusation, knowingly repeated information that was false, deliberately ignored evidence establishing the employee’s innocence, or used an investigation as a pretext to damage the employee’s reputation.
The quality and good faith of the investigation can therefore become important evidence in a workplace defamation case.
Can a Former Employer Defame an Employee in a Job Reference?
Potentially. California law provides significant protection for certain communications between a former employer and a prospective employer concerning an applicant’s job performance or qualifications when the statutory requirements are satisfied and the communication is made without malice.
That does not necessarily give a former employer permission to knowingly spread false information. A particularly serious situation may arise when a former employer intentionally provides false factual information that interferes with the employee’s ability to obtain another job. If you suspect that a former employer is giving you a defamatory reference, however, suspicion alone is generally not enough. Determining what was actually said and obtaining admissible evidence of that communication can be critical.
What If the False Statement Appears in a Termination Letter or Personnel File?
A false statement placed in an employee’s personnel file or termination document may become relevant to a defamation claim, but merely writing something false in an internal document does not automatically establish liability. Among other issues, it is important to determine whether the statement was published to another person and whether a privilege applies.
These documents can nevertheless become important evidence, particularly if the accusation is later repeated to other employees, clients, prospective employers, licensing agencies, or others.
Defamation and Wrongful Termination Are Different Claims
Employees often assume that being fired because of a false accusation automatically means they were wrongfully terminated. That is not necessarily true.
California generally permits an at-will employee to be terminated for a reason that is unfair, mistaken, or based upon incorrect information, provided the actual reason for the termination does not violate a specific law or public policy.
For example, an employer might mistakenly believe that an employee violated company policy and terminate that employee. The fact that the employer was wrong does not by itself make the termination unlawful. However, publishing a false accusation about the employee to other people can raise a separate defamation issue.
A workplace dispute can also involve both defamation and other employment claims when the evidence supports them, including discrimination, retaliation, whistleblower retaliation, or other unlawful conduct.
How Long Do You Have to File a Defamation Claim in California?
California generally has a one-year statute of limitations for defamation claims.
The deadline ordinarily runs from publication of the allegedly defamatory statement rather than from the date the employee later discovers all of the consequences of that statement. This can create problems for employees who wait for a long time after termination before investigating suspected defamatory statements.
Because different statements may have been published at different times, the applicable deadline should be evaluated based on the specific facts of each case.
What Should You Do If You Believe Your Employer Defamed You?
If you believe that you have been defamed at work, preserve the evidence before it disappears.
Save relevant:
- emails and text messages;
- termination documents;
- disciplinary notices;
- performance evaluations;
- investigation documents you lawfully possess;
- names of witnesses who heard the statements;
- communications from recruiters or prospective employers; and
- documents showing lost employment opportunities or other financial harm.
It is also useful to write down, while events are still fresh, the exact words you believe were used, who made the statement, who heard or received it, and approximately when it occurred. Avoid assuming that a defamatory statement was made simply because you believe someone is damaging your reputation. A viable case generally requires evidence of an identifiable statement and publication.
Evaluating a California Workplace Defamation Claim
Workplace defamation cases are notoriously complex. A statement may be extremely damaging and completely false, but still be protected by a privilege. On the other hand, an accusation that initially appears to be nothing more than an internal employment dispute may become significantly more serious when there is evidence that someone knowingly fabricated allegations or spread them beyond those who had a legitimate reason to receive them.
When evaluating a potential workplace defamation claim, some of the most important questions are:
What exactly was said? Who said it? Who heard or received it? How do we prove that? Was it false? And does a legal privilege apply? Those questions often determine whether a workplace defamation claim is worth pursuing.