Employment Reference Letter

What is an Employment Reference Letter?

An Employment Reference Letter, sometimes called a Reference Letter or Statement of Service, is a simple statement which is provided by an employer to confirm the employment history and details of a former employee.

The Reference Letter is intended to be an accurate record of employment, including the employee's job title, period of employment/service and a summary of duties.

Is it mandatory to have an Employment Reference Letter?

In Australia, an Employment Reference Letter is commonly provided upon request from departing employees. Although not required under the Fair Work Act 2009 (Cth) or any other applicable law, many Employment Agreements, industrial instruments and Modern Awards do make the provision of a Reference Letter compulsory, where requested by a departing employee. Providing references can also help to build goodwill with former employees as well as current employees.

What is not allowed in an Employment Reference Letter?

The Employment Reference Letter should not include false or misleading information, whether it is in relation to the employee's duties, the period of their employment, their job performance or anything else.

The employer should make sure to provide true and accurate information in the Employment Reference Letter, to the best of their ability.

What are the prerequisites of an Employment Reference Letter?

Before an employer provides a Reference Letter, the employee should have actually worked for them, in the stated job.

The employee may use the Reference Letter to apply for new jobs, so the employer should be prepared to lose the employee. However, denying an employee a Reference Letter is not a good way to incentivise them to stay. Instead, giving the employee a rewarding job and a supportive workplace are likely to be more effective.

Who can enter into an Employment Reference Letter?

A Reference Letter should be provided by someone who actually had responsibility for the relevant employee. For small businesses this could be the business owner but for larger businesses it may be a manager or supervisor.

What has to be done once an Employment Reference Letter is ready?

Once completed, this Reference Letter can be signed by the relevant person, dated and provided to the employee as a record of their employment with the employer. The person providing the letter should be ready to be contacted by potential new employers for the employee.

What must an Employment Reference Letter contain?

An Employment Reference Letter may be used to confirm the details of the employee's employment with the employer. This may include:

• full name of the employer.
• full name of the employee.
• employee's position title.
• employee's period of service.
• a summary of the employee's duties.
• an optional personal reference for the employee. A personal reference is a personal statement from the employee's supervisor or other relevant party. Providing a personal reference is entirely optional, but is common where an employee has performed well in their role.

Which laws are applicable to an Employment Reference Letter?

Although not required under the Fair Work Act 2009 (Cth) or any other applicable law, many Employment Agreements, industrial instruments and Modern Awards do make the provision of a Reference Letter compulsory, where requested by a departing employee. Employment Agreements in Australia are subject to general principles of contract law.

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