What it means
For a statement to count as slander it generally needs to be false, to be communicated to at least one other person, and to cause harm to the reputation of an identifiable person or company. Truth is normally a strong defence, and opinion that is clearly presented as opinion is treated differently from a claim of fact.
The detailed tests vary between countries and between legal systems. The practical difference from libel is the medium.
Slander is spoken, so it is often harder to prove because there is no permanent record, whereas libel is written and can be shown to a court. In some legal systems slander requires proof of actual financial loss, while certain categories such as accusing someone of a crime or of professional incompetence may be treated more seriously.
Business exposure arises more often than people expect. A salesperson who tells a prospect that a rival is close to insolvency, or a manager who tells a bank that a former supplier cheated them, could be making a statement that damages a reputation.
If the statement turns out to be false, the company may face a claim for damages. The financial effect can be significant on both sides.
A damaged reputation can cost a business contracts, credit terms and staff, and a defendant may face legal fees, damages and their own reputational harm. This is why many companies include guidance on public statements in their conduct policies and train client-facing staff accordingly.
Finance leaders should pay particular attention to statements about financial condition. Remarks about a company's solvency, profitability or accounting can be especially damaging because they affect lenders and investors directly.
When in doubt, stick to verifiable facts, point to published filings and let the lawyers handle anything contentious. A sensible company also keeps a record of the facts behind any public statement it makes about a third party.
If a dispute does arise, being able to show that the claim was true, or was made honestly on reasonable grounds, is the strongest protection available. Statements made on a privileged occasion, such as evidence given in court, are usually protected as well.
In practice
Real-world examples.
Example
At an industry conference, a sales director tells a group of prospects that a competing firm "is about to go bust and has not paid its suppliers for months". The claim is untrue and one prospect cancels a $90,000 order with the rival. The rival's lawyers send a letter demanding a retraction and compensation.
Example
A hiring manager gives a verbal reference to a recruiter saying that a former employee "stole from the till". The accusation was never proven and the candidate loses a job offer worth $65,000 a year. The former employer must now defend the statement.
Example
A restaurant owner tells neighbouring shop owners that a local food supplier sells spoiled produce. The supplier loses two regular customers and consults a solicitor. The owner's best defence would be evidence that the claim was true. Without it, he may face damages, legal costs and the loss of goodwill among the same neighbours he was trying to impress.
Case study
Seen in the real world.
Northgate Fittings is an illustrative, fictional building supplies company. One of its regional managers told a major customer that a competitor, Ashdown Supply, had been "fined for fraud" and could not be trusted with large orders.
No such fine had ever been issued. Ashdown learned of the remark when the customer mentioned it, and its lawyers wrote to Northgate asking for a correction. Northgate's own counsel reviewed the facts, found no basis for the claim, and advised an immediate retraction and apology.
The illustrative lesson is that a single careless remark can create a legal cost far larger than any sale it might win. Northgate later added a short section on public statements about competitors to its sales training. The company also asked managers to route any concerns about a rival to the legal team instead of raising them with customers.
Watch out
Common mistakes.
- Believing that spoken remarks are safe because nothing was written down, when witnesses can give evidence of what was said.
- Assuming that phrasing a false claim as a rumour ("I heard that...") is enough protection, when repeating a defamatory statement can still create liability.
- Treating all negative comments as slander, when honest opinion and true statements are generally defensible.
Questions
People also ask.
What is the difference between slander and libel?
Slander is spoken and libel is written or otherwise recorded, though some legal systems treat broadcasts and online posts as libel.
Is a true statement ever slander?
Generally not, because truth is normally a complete defence, although the burden of proving it can fall on the speaker.
Can a company be slandered?
Yes, a business can bring a claim if a false spoken statement damages its commercial reputation.
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