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If you're making hiring decisions based on someone else's statements about the applicant, that someone's statements, if false, are pretty much the definition of defamation in the US.

It's perfectly just that the applicant get to know if the reason they didn't get a job is because their bitter former boss defamed them.

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I mean, agreed. I'd go even further and say the whole "Eligible for rehire?" question is an effort to backdoor this into employment verification. Employment verification should be "First date of employment? Last date of employment? Thank you."

"Are they eligible for rehire?" is the nudge nudge wink wink around "well, most of you have policies around providing formal references about performance, so here's one way we can try to gauge".

It also assumes the company still exists.

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