Has a former company you worked destroyed your chances to get a new job by giving you an undeserved bad reference?

I've only had 2 positions that I left somewhat amicably, but where there was some question of whether or not they would slight me. As SFC James Sczymanski alludes to, it is supposed to be illegal to give anything more than a confirmation that you worked there for a time period if you have nothing good to say. I have just avoided using them as references to avoid any potential issues. Luckily, I still have folks in the Guard, 2 GOs and former civilian coworkers and managers who will give me a reference when I need one.

"Undeserved" is in the eye of the beholder. References are just one wedge of the pie. Along with job patterns, interview, and resume validation, a picture emerges. Most of the time that picture is about right. Business development types that hop around every 1-2 years tells employers they were let go because they didn't bring work in. Most patterns of short term employment are a negative. Patterns of being in the same firm with a couple promotions along the way are a plus.

Getting sued for what a company reference said is problematical. It essentially has to be libel to gain traction, hence rare. An EEO complaint is also tough as an actual connection has to be proved. They simply say neutral statements which kill in a competitive environment. Yes he showed up every day, got most work done on time and went home. Nothing about the innovation, quality, difference to the company, etc. Did they lie? No. Smart checkers with probe in these areas and typically receive a no comment or that information is company protected sensitive.

On the flip side, some firms actively poison wells by saying "he/she signed a nondisclosure and/or noncompete agreement". Common in Silicon Valley. Firms are tired of raiders.

If you don't know what a firm will say about you before you leave, then that's a shortcoming on your part. If you know it won't be polite, be prepared to deal with that up front with the next firm. A great opportunity to let your honesty shine.

I don't know how a person would ever find out the truth. But I used to work for a well known company, one that claims hiring military veterans. I showed up one day my supervisor met me at door took keys and ID and said corporate was letting me go. After, I never got any interviews from other good companies until I changed the POC on my old job from that supervisor to the company HR manager. So I believe that supervisor was giving out bad reports on me. He always made snide remarks about what he thought I did in Army...but I never felt I could complain cause I had a family to support.