How to deal with defamation by an ex-employee

6 Jun 2019 By Amanda Hamilton

Amanda Hamilton explains what organisations can do if a disgruntled former worker bad mouths their business

Unfortunately, sometimes an ex-employee, particularly a disgruntled one, may say less than complimentary things about your business. So, what can you do? This is a job that often falls to HR – so it’s important to understand your options, so that you can make an informed decision about just how far to take it. 

The first step is to contact the perpetrator and see if you can sort the issue out. But if this fails, and they still refuse to stop, and you feel that their actions are having a detrimental affect on your business, then court action may be your only recourse.  However, it will usually help your case if you have already made an attempt, outside the court system, to resolve the issue.

Another factor to take into account which may assist your case, is whether or not the employee has a clause in their employment contract which may restrict them in discussing your business. Whether or not such a clause can be relied upon will depend on the nature of your business and whether it’s reasonable to do so. There is also the possibility that they may have signed a separate non-disclosure agreement which would also restrict them in disclosing information of any kind or discussing your business.

If neither of the above apply, then perhaps it would be beneficial to consider implementing this as part of an ongoing change to your employment contracts.

If all your attempts to stop your ex-employee bad-mouthing have failed, the next step is to consider taking court action for defamation. Such an action will only succeed under the Defamation Act 2013 if you, as the claimant company, can prove that ‘serious harm’ in the form of serious financial loss has been caused. 

It’s most important before going to court, that you should comply with the Civil Procedure Rules – the rules that are followed by the courts and parties in civil court proceedings. This means both parties are expected to follow the Pre-action Protocol for Defamation. A huge emphasis of this pre-action protocol is on alternative dispute resolution, ie, the parties are encouraged to find a solution to their dispute by any other means rather than going to court. 

You or your firm’s legal representative can negotiate with the defendant’s legal representative or you can also ask for mediation – where an independent third party works with both sides to find an acceptable resolution. This may simply involve going for a retraction, an apology and the deletion of any online content or it may go further and require a financial payment. 

Should there be no resolution, and the only alternative is to litigate, then it’s in the hands of the court. There’s no 'one size fits all' with defamation cases. The courts will look at each case on its merits and you can’t be sure the court will find in your favour. Finally, think about the costs – even if you win the case you may not be awarded damages that cover the time, effort, energy and stress you put into winning. 

No-one likes to let someone who has ‘bad mouthed’ them get away with it – but if you can avoid the courts, it’s best to do so, or you may find yourself with a victory you wish you’d never fought for. 

Amanda Hamilton is chief executive of the National Association of Licenced Paralegals

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