Candidate 2's previous employer is a friend of a friend of the golfing partner of the potential employer. It came up during a BBQ at a mutual friends Nephews Christening.
Very unlikely also very unprofessional, plus depends on the size companies you work for, size of the place you live & if you even work in the same town you live.
I certainly wouldn't dismiss a candidate form a job because of some chinese whispers of a tribunal in fact if he had been well within his rights & had be dismissed unfairly i would understand completely.
The laws of employment are there for a reason & should be adhered to i know working for a very big company we have to do everything by the book.
Companies that dont follow employment laws deserve to be dealt with IMO