I know there are not many states that have laws prohibiting what a previous employer can and cannot say, although there is a rumor floating around GA, that employers can only state wether they would or would not rehire.....
So here is my circumstance and question.

My husband has been job hunting off an on for the last few years. After applying to one company we received his rejection letter accompanied by the background check that they had done, by an independant firm.
One of the previous employers gave my husband a bad reference stating that he was consistantly late for 1 week and that he had damaged company equipment. However there is no documentation to support either claim.
They did not use a time clock and there are no reports, write ups or etc, in regard to the damaged equipment.
My husband stated that he had given them a proper 2wk notice of resignation, and that the previous employer was angry that he was leaving, so in essence he said those things in retaliation.

So my question is, can he do and say those things without proof? If it is untrue and he is telling other prospective employers these things and it is costing my husband work, then is it some form of slander or something?
Thanks!

There are NO states, GA included, where an employer can only say whether or not the employee is eligible for rehire. In all 50 states, despite a persistant and mistaken belief otherwise, an employer may provide any reason that is true, that they have an honest and supportable belief is true, or that represents their honest opinion.

One thing you have not said is whether or not the report is true. You have only said there is no proof of it.

If it is true, then the employer may say so, whether they have proof or not. If it is the employer's belief that it is true, they may also say so, even without proof and even if they are mistaken

If it is not true, and the employer KNOWS it is not true, and if your husband can show evidence that this reference is the reason he is not being hired, then he may be able take legal action. He will need to discuss it with a local attorney, however.

Thanks for the quick reply. :)
The claims are not true, so my husband says.
As for arriving late, my husband says that he would arrive to work and go straight to work, versus taking part in the morning "social hour", with the boss and other coworkers.
As for the equipment, there was actually some paint on the truck, however no damages that the employer was claiming. My husband can't say whether the paint was there before he started driving the truck or not, as it was quite an insignificant amount and not something you would notice without close inspection.

So i guess in either case the employer could believe he was correct.
We can only conclude that the employer's remark was the reason for the non hire. They stated it was due to a negative item on the report and that former employer was the only negative item listed.