SW Legal Educational Publishing

Employer Could Be Liable for Defaming Employee for Inaccurate Report to Police
Description An employee was fired for an alleged theft that was reported to the police, which issued felony charges against the former employee. The charges were dropped when company records proved otherwise. Suit for defamation against employer may proceed to determine if employer acted in good faith in reporting the matter to the police.
Topic Torts
Key Words Defamation; Employment; Qualified Privilege
C A S E   S U M M A R Y
Facts Boyd worked for Nationwide Insurance as a claims representative. He held the job for four years and was promoted twice before being fired for stealing. Boyd denied all accusations. Nationwide told the New York police that Boyd had stolen $3,760 from the company by writing and cashing two checks for a single insurance claim. Based on that information, a felony compliant was issued against Boyd, which was reported in a newspaper. The district attorney dismissed the suit when it was found that Nationwide records did not support the assertions that had been made. Boyd sued for defamation. The trial court dismissed the suit, holding that the company's failure to investigate more carefully was not reckless disregard needed to show malice. Boyd appealed.
Decision Reversed. Even though an employer has a qualified privilege to share evidence of employees' wrongdoing with law enforcement, which can protect employers against such suit, the failure of the employer to check its own records before speaking raises questions that should be explored at trial. Failure to investigate may be found to be malice. False accusation of a serious crime is slander per se under New York law, so the focus at trial will be on whether the employer acted in good faith in reporting the matter to the police, in which case it may be protected by its qualified privilege.
Citation Boyd v. Nationwide Mutual Insurance Co., - F.3d - (2000 WL 305941, 2nd Cir.)

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