The ones who do 3 months of actual work get fired because their overperformance scares the boss. But less than 2 weeks of actual work and you're an underperformer. The sweet spot is probably the geometric mean of the two.
Whether the US civil system itself is based on merit or reason, the problem is that employers have all the resources and can play parliamentary procedure ad nauseam--even in the rare cases where the good guys win, they'll file appeals and motions while refusing to pay the judgment. Not to mention, they know which judges can be corrupted, and they also have PR resources and will rape the shit out of anyone who even mildly embarrasses them.
Frivolous litigation happens but is fairly rare but, as you said, nothing in this country prevents potential employers from anally raping candidates for "bad-mouthing" prior companies. In the US, that's a legally defensible reason to fuck someone over, even if what was said about the ex-employer was truthful.
I spent more than a decade in the tech industry and I know a lot of people.
Silicon Valley is a disgusting place. The less you know, the better for your soul. What-the-fuck is a reasonable reaction.
As for physical consequences of bad references, there's obviously going to be a spectrum. It's very unlikely that someone would get hit for saying something like "I don't like him" at a bar and accidentally costing someone a job. Those things happen, and very few people are irrational or paranoid enough to call in a hit man over something small that isn't going to happen again.
If someone is deliberately running around saying, "You shouldn't hire him" or "He was fired for cause", though, it's inevitable that he's going to get what's coming to him.
Rationally speaking, people usually make this calculation based on what they think the person is going to do in the future. Sometimes the motive is revenge, but usually it's just intimidation. If it's truly a one-off, people usually let it go. If someone is making it impossible to find work, though, then people get desperate.
I'm saying that people in the tech industry will do anything to protect and expand their reputations. The stakes are just that high--we're talking about the difference between 7-figure jobs and unemployability--and most of these people have no moral scruples even when the stakes are small. The ones with scruples don't last. Given the stakes and the mentality we're talking about, the cost to have a "reputation problem" "taken care of" is a rounding error.
The probability that someone would be intentionally killed over a single instance of a negative reference is very low, but it's definitely nonzero. Probably 0.05-0.25% at lower levels (SWE, Sr. SWE, entry-level manager) and 1-25% at executive levels. Thus, what the OP is advising could get someone killed, and since there is also nothing to be gained by it, I argue that it's a bad idea.
It's not that surprising. Reputation is a big deal in Silicon Valley. The people who won't do whatever is necessary--even end a human life, if it comes to that--to defend their reputations end up having theirs taken away.
I'm not saying this is a good or moral thing. It's obviously not.
I don't think anyone publishes statistics on this, but the thing you have to understand about Silicon Valley is that it runs on reputation. Skills are commonplace. H1-Bs have skills. 20-year-olds have skills. Instead, people get the good jobs based on what they can force other people to say about them, not based on what they can do. Silicon Valley is also a place where success forgives all sins, full of people with very little in the way of scruples, and where vendettas are generated all the time over the smallest shit.
This isn't limited to Silicon Valley. In any business where reputation makes the difference between 7-figure salaries and unemployability, you're going to have people who'll stop at nothing to "fix" reputation problems. That being said, these things usually don't run all the way, because even Silicon Valley people don't kill lightly, so there's a series of escalations before it gets to that, and most people aren't willing to defend their vendettas with their lives.
Bad references can ruin careers. When you're talking about the difference between getting a $500k per year job and being completely unemployable, it makes sense.
That all said, people usually start with intimidation, and that's usually enough. Very few people believe in their vendettas enough to die for them, and very few people want to kill or have someone killed, just to make a problem go away, if they don't need to do so.
I do have stories, but I'm not going to share them, for obvious reasons. Only one of the ones I know well involved a person actually dying, but quite a few where people were "roughed up" and are now disabled.
It's not just horrible advice. It's dangerous and unethical.
In Silicon Valley or on Wall Street, when people lose jobs on reference checks, people often get hit men sent to their house, and while the objective usually is just intimidation, all sorts of bad things can happen in that situation.
Putting someone at risk of getting killed because "his references weren't as enthusiastic as I expect everyone to be" is fucking immoral.
Some of these are good, some are bad, but this one is dangerous and unethical:
When checking references for a job applicant, employers may be reluctant or prohibited from saying anything negative, so leave or send a message that says, “Get back to me if you highly recommend this applicant as super great.” If they don’t reply take that as a negative.
When you flush a candidate on a reference check, there's a good chance that he'll figure out what happened, and justifiably become paranoid. He's going to assume someone deliberately ratfucked him, which is not necessarily what happened here--the person could have legitimately thought highly of the candidate, but forgotten to reply because the email came at an inconvenient time (or ended up in the spam folder). At the minimum, you're destroying someone's professional relationships, but if this is in an industry like Silicon Valley, where people have glowing references not because of sincerity but because everyone who matters retains a hit man to "fix" negative ones, you're putting people in danger of physical harm, including the possibility of death. Worst of all, since the candidate might not know which reference ratfucked him, you could end up getting someone innocent killed.
So, don't do this. The main function of reference checks is to ensure you're not getting someone who claims to have worked at Goldman Sachs or Google for 4 years but actually never set foot there. Leave it at that and be happy.