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Is “blacklisting” a former employee legal?

Long gone are the days when employees (and employers) could expect to work for the same company their entire career. People may not exactly “job hop,” but they now realize that it’s better to leave a toxic work environment when necessary – and go where the financial or emotional rewards are greater.

What happens, however, if your former employer “blacklists” you in your industry? Here’s what you need to know:

What’s blacklisting?

This is any sort of manipulation a former employer uses to discourage other companies from hiring someone. It can manifest in various forms, from sharing private information about an employee with other employers and through industry networks in a way that purposefully (and unfairly) sabotages the former employee’s chances of finding a new job. This can be very difficult for workers who are in highly specialized or narrow industries or those living in small communities.

Indiana Labor and Safety Code § 22-5-3-1 says that blacklisting is illegal, and it can be punished by criminal prosecution – and subject to civil claims by the affected worker. However, there is a caveat: Employers can reveal truthful information about why you were terminated to other potential employers when asked for a reference – just not anything malicious or misleading.

Usually, people find out that they’ve been “blacklisted” because someone tells what they’ve heard, but other times you may not notice until a tentative job offer is revoked as soon as your references are checked.

If you believe that you’ve been blacklisted by your former employer and it has negatively affected your career and finances, it may be time to seek informed legal guidance about your options.