Accepting an offer of employment can be an exciting time for someone. But just like any other contract, the hiring process is two parties agreeing to fair and straightforward terms that are fair for both sides. Sadly, sometimes this is not the case.
Fraudulent inducement of employment is a legal claim made when one party is defrauded into taking or staying in a certain position based on false statements made by the employer. Here is what you need to know about fraudulent inducement of employment and how to protect your rights if you find yourself in this situation.
- What are some Examples of Fraudulent Inducement of Employment?
- What do I Need to Prove?
- What are the Elements of Proof?
- What Type of Evidence Might help My Case?
- Are there any Defenses to a Fraudulent Inducement of Employment Claim?
- Do I Need an Attorney for a Fraudulent Inducement of Employment Claim?
Some of the classic examples are about pay. If during the interview an employer promises $25 an hour, but when the first paycheck shows up the employee is only getting $20, they can sue for fraudulent inducement.
Other common areas that an employer can fall into an inducement claim are promising certain working conditions, benefits, vacations, raises, promotions and other promises that they don’t plan on keeping. Employment guarantees can be a bit trickier. Many states are employment-at-will jurisdictions, so the employee usually can’t sue for being fired in these places. They can assert, however, that they never would have taken the position in the first place without the promise.
Although every state has their own particular laws when it comes to fraudulent inducement claims, there are commonalities in what elements a victim needs to prove to collect on their claim. The first is that the employer made an intentional misrepresentation of fact to the victim concerning their employment.
Second, the misrepresentation must be an important deciding factor for the victim in either taking or continuing the employment. Then, the victim must show that they reasonably (or justifiably) relied on the misrepresentation, and that they suffered calculable damages because of it.
It is important to note that the misrepresentation needs to be intentional. If the employer claims that the falsehood was simply a misstatement or a mistake, the victim may not be able to recover. Unfortunately this is a hard element to prove, especially if the only proof the plaintiff has is a conversation between themselves and the employer.
More concrete evidence like letters, recorded phone calls, or email exchanges might be needed to show the employer’s intention. Proving the second element is usually a little less difficult. The victim can show evidence that they moved to be closer to the job, quit or passed up another opportunity for this one, or any other affirmative steps to show that they if not for the lie, the outcome would be different.
Reasonableness matters, too. If the employer makes an outlandish claim like an exorbitant salary or other ridiculous perks that would not happen in other circumstances usually won’t fly.
Proving your claim will be difficult without the proper evidence to back it up. You need to show that the employer made a statement of fact as opposed to just a general opinion. An undocumented conversation, while the content may seem solid evidence, is just he said/she said without something to back it up. Email thread and letters are great pieces of physical evidence, but you may not have those available to you.
Another idea is to keep recordings of conversations you had with the other person either over the phone or in person. But be very careful! In some states you only need the consent of one of the parties to record and submit a conversation for evidentiary purposes. In others, you need the consent of both parties, or else you are breaking the law. Check the current laws in your state before you get yourself into more trouble than you intended.
If you are an employer facing a fraudulent inducement suit, there are some defenses you can assert to deny liability. Negating one of the elements of the claim is the easiest way. For example, you may argue that no misrepresentation made in the first place or that it was not intentionally made.
There are some instances where the statements made by an employer conflict with the terms in the employment contract. Once signed, the contract will control unless the plaintiff can prove otherwise. This is why documentation is so important.
Whether you are an employer facing a fraudulent inducement claim or an employee looking to recover damages, hiring an employment attorney is a vital part to the success of your case. Only an attorney will know the specific laws in your jurisdiction, be able to analyze your case, and properly protect your rights.