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That some federal employment laws exist, but fine points vary from state to state.
For the last decade, however, I have been told repeatedly by one HR Department after another that they cannot give 'recommendations' nor can they actively discourage the employment of an individual. They'd get their butts sued off. And actually, it's not all that hard to prove legally.
If you've made it to some final stages in the interview process only to be turned down at the reference stage a couple three times, you get a clue. A lot of folks then have a friend or relative call into the old firm looking for a reference on the individual in question. If they hear dish, they've got cause.
Any time you've worked for a firm for a lengthy period of time, find someone in a position of authority over you who will write you a letter of recommendation on company stationary.
Management and Human Resources folk are trained not to offer opinions on work performance. They are allowed to state the title of your position, relay the basics of the position description, confirm your hire date and separation date, confirm your salary or pay rate, and they're allowed to disclose only whether you "would be rehired." That's a very telling phrase. Any potential employer who hears that an employee 'would not be rehired' would definitely be hesitant to take on the applicant in question, -but it is not in anyway illegal or actionable for the former employer to say this if their former employee was fired for cause and those causes are documented.
That single phrase tells a potential employer many things about an individual. Even if your firm wrote you a bad performance review, then let you go citing company-wide cutbacks and cost-saving measures, they could not legally tell a potential new employer that you 'would not be rehired.'
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