Defamation in the Workplace

A poor performance review can have detrimental reputational and financial consequences for an employee, especially if the performance review is based on false information. Despite the harm caused to the employee, employers are often protected from liability for otherwise defamatory statements made within performance evaluations because employers enjoy a qualified privilege over intracorporate communications. However, an employer’s false statement that is made with actual malice will lose any qualified privilege and could subject the employer to liability for defamation.  

An employer does not enjoy a qualified privilege over false statements made with actual malice. “Actual malice exists when a statement is made with knowledge of its falsity or with reckless disregard of its truth or falsity.” Doe v. Gonzaga Univ., 143 Wn.2d 687, 703, 24 P.3d 390 (2001), rev'd, 536 U.S. 273, 122 S. Ct. 2268, 153 L. Ed. 2d 309 (2002) (citation omitted) (internal quotations omitted). Reckless disregard for the truth or falsity of a statement exists when, “…one knows of the existence of information which would render a statement false and, nevertheless, without reasonable justification, disregards the information.” Id. at 704.  Therefore, an employer’s false statement is made with actual malice if the employer publishes the statement without regard for its truth or falsity.  Where a false statement is made with actual malice, an employer does not enjoy a qualified privilege and may be liable to the employee for the harm caused by the employer’s false statements.