Guidelines call for fuller job references

Employees who try to agree a reference when they leave a firm should be told that the employer retains the right to change it later, if this is needed to comply with Financial Services Authority (FSA) regulations, say guidelines drawn up by the City Personnel Group (CPG).

The guidelines relate to employees performing customer functions in firms regulated by the FSA. These include traders and other front office bank staff.

The CPG, which represents human resources staff at banks, said its recommendations are aimed to help employers comply with FSA rules, which came into force last December.

Mark Taylor, an employment lawyer at law firm Lovells, said: 'References have changed a lot in just a few months. They give far more information than they used to and a lot of employees are not happy.'

The CPG guidelines say that if a firm upholds a complaint made against an employee by a customer, this should be disclosed in a reference. The employee should be told this, if possible.

Employers should also consider disclosing issues such as mental or physical ill-health, or prolonged absence from work, if they believed an individual might not meet FSA standards of competence. Details of disciplining for drug abuse could also be disclosed.

The CPG stressed that references should comply with data protection law and should be scrupulously fair to the employee.

Taylor said informal verbal references were becoming less common, as bosses were scared these might be referred to in lawsuits by disgruntled former staff. Employees have the right to be told what their references say under the Data Protection Act.

Until the new FSA rules came into force, references typically revealed little more than dates of employment and job function.