Fraudulent Inducement of Employment

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 What is Fraudulent Inducement of Employment?

Fraudulent inducement of employment refers to a situation wherein an employer makes an intentionally false statement to trick a current employee or prospective hire into accepting an offer. A person who is a victim of fraudulent inducement of employment may be able to sue an employer for false promises and recover damages.

However, in order to sue an employer for false promises, the victim must be able to satisfy the requirements of fraudulent inducement of employment in accordance with state laws. Most importantly, the victim must prove that the employer intentionally and knowingly made false promises for the purposes of getting them to accept an offer. Misstatements of facts, mistakes, and/or opinions will not be sufficient to prove that fraudulent inducement occurred.

Unfortunately, it can be very difficult to prove fraudulent inducement of employment. This is especially true when the only evidence that exists is an oral conversation held between the individual and the employer.

Therefore, if you believe you were fraudulently induced to accept a job offer or to remain in your current position, then you should contact a local employment lawyer immediately for further advice.

What Are Some Examples of Fraudulent Inducement of Employment?

Some common examples of fraudulent inducement of employment revolve around an employer hiring under false pretenses.

For instance, to make a job offer seem more appealing, an employer may convince a prospective hire to take a job by promising them a certain salary, perks (e.g., free snacks), benefits (e.g., vacation time), raises, promotions, titles and even specific working conditions that they do not intend to keep once the candidate accepts their offer.

So, for example, if a job candidate is deciding between two offers and ends up accepting one of them because an employer promised them a salary of $50,000, but then only pays them $25,000, the job candidate can then sue that employer for fraudulent inducement of employment.

On the other hand, if an employer’s promises seem too good to be true, are outrageous, are more likely opinions (as opposed to facts), and/or could not justifiably or reasonably be relied on by the average person, then a prospective hire or current employee may not have grounds to file a claim for fraudulent inducement of employment.

Another example of fraudulent inducement of employment may come up when a current employee is attempting to quit their job for another one and their employer promises them better pay or a promotion if they stay with the current company.

However, these cases are a bit harder to prove than the first example and require a substantial amount of evidence. This includes the damages they suffered for continuing to work at the company and that their employer intentionally lied about offering them such perks to convince them to continue doing their job solely for the employer’s benefit.

What Are the Elements of Proof?

Each state has its own specific laws and requirements to prove a claim based on fraudulent inducement of employment or fraudulent misrepresentation. However, there are a handful of similarities that will apply across the board. Thus, the elements of fraudulent misrepresentation or fraudulent inducement of employment will generally include the following:

  • That an employer intentionally misrepresented a fact or several facts to convince a party to accept their offer;
  • That this misrepresentation was one of the primary reasons that a prospective hire accepted the position or that a current employee continued to work at a company;
  • The misrepresentation was one that was reasonable or could reasonably be relied on by a prospective hire or current employee;
  • That by relying on this misrepresentation the prospective hire or current employee suffered actual damages; and
  • That had the prospective hire or current employee known the truth, they would not have accepted the employer’s offer.

In other words, the plaintiff will need to prove that if an employer had not intentionally misrepresented some fact or facts about a particular job, then they would have declined to accept it, and would be in a different and potentially better situation then they are in now due to being misled.

It is important to note that the employer must have intentionally misrepresented a fact. If an employer argues and can prove that the misrepresentation was actually a mistake or misstatement, then the plaintiff may not be able to recover any damages.

What Type of Evidence Might Help My Case?

In order to bring a successful case, a plaintiff must have proper and sufficient evidence to support their claim. Some forms of evidence that may be helpful include: email threads, written correspondence, an employment contract, recorded conversations, witnesses, and/or any other documentation that shows an employer intentionally misrepresented a fact that a reasonable person would believe was true.

Additionally, the plaintiff should also submit evidence that demonstrates they suffered some sort of harm or financial loss due to this misrepresentation. For instance, if they quit a job, passed up a lucrative job opportunity, or relocated to be closer to the job, the plaintiff should supply evidence that supports the detrimental outcome.

This may include emails or letters that contain information about a job offer, a letter of resignation to their former employer, receipts or bills associated with a move, and/or perks or benefits they gave up to accept the fraudulent offer.

Are There Any Defenses to a Fraudulent Inducement of Employment Claim?

A defendant who is being sued for fraudulent inducement of employment may be able to raise a number of defenses against a claim. One defense that may serve to dismiss a case is by arguing that not all of the elements of proof exist. For example, a defendant may argue that they did not intentionally misrepresent a situation or that no misrepresentation was made in the first place.

Depending on the circumstances surrounding a particular matter, another defense that a defendant could possibly assert is that the plaintiff unreasonably relied on oral statements. For instance, suppose an employer made claims about the issue in question that conflicted with the terms contained in the plaintiff’s employment contract.

According to contract principles, unless the plaintiff can prove otherwise, the terms of the employment contract will control the decision. The defendant can then claim that the plaintiff unreasonably relied on their statements, which were clearly at odds with what was agreed to in their employment contract.

One final defense that may be available to defendants in such cases is if a defendant did not know that their statement was false.

For example, if the owner of a company demanded that their hiring manager tell all prospective hires that they would receive an immediate bonus for signing with the company and these bonuses had always been distributed in the past, then the hiring manager may be excused if they did not know that the owner was lying or going to revoke this deal.

Do I Need an Attorney for a Fraudulent Inducement of Employment Claim?

If you wish to sue or are being sued for fraudulent inducement of employment, you should strongly consider hiring a local workplace lawyer to assist you with your case.

An experienced employment lawyer will already be familiar with the laws in your jurisdiction and can apply this knowledge to analyze your issues and determine whether you have a claim. Alternatively, this information can also be used to identify any defenses you may be able to raise.

Depending on the circumstances, your lawyer can help you file a claim or prepare a defensive argument. Your lawyer can also provide representation in court or at alternative dispute resolution sessions (e.g., mediation, arbitration, etc.). Additionally, your lawyer can make sure that you understand your rights under the law and that those rights are protected.

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