This week's question comes from Nicole T. in Pacific Heights, who asks:
Q: “I had a really good job in Southern California and I was not planning on changing jobs. I was approached by a client who's account I worked on who asked me to come in-house, meaning leave my job and go to work for them full time. I was initially uninterested but they were very persistent and kept upping the ante. I had worked for my employer for about six years [in Los Angeles] and it was a very stable company. Finally, this client wore me down and made me an 'offer I couldn't refuse.' So I accepted and moved to San Francisco. When I moved here, I soon learned that most of what they had promised me, like the opportunity for travel, commission and vertical growth was nonexistent. Their client base and sales volume is a fraction of what I had been told. Had I known then what I know now, I would never have given up my job and moved. What are my rights?”
A: Nicole, last week I talked about bait-and-switch in the setting of consumer products. This is where a retailer advertises one product, but when you arrive to purchase it, you are told that the TV you came in for is sold-out and the salesperson tries to sell you either another product instead. What you have described is a form of the same scheme but in the employment context. This, however, is nothing new. A prime and disgraceful example of this is the exploitation of workers that occurred in the Dust Bowl era when some agricultural businesses enticed people to move to California with promises of plentiful work and good wages only to create an excess of supply of labor, which allowed the farmers to lower the price until they were paying almost nothing to the workers.
As a result of these abuses, California enacted worker protection laws embodied in the Labor Code.
California Labor Code Section 970 states that “No person, or agent or officer thereof, directly or indirectly, shall influence, persuade, or engage any person to change from one place to another in this State or from any place outside to any place within the State, or from any place within the State to any place outside, for the purpose of working in any branch of labor, through or by means of knowingly false representations, whether spoken, written, or advertised in printed form, concerning either: (a) The kind, character, or existence of such work; (b) The length of time such work will last, or the compensation therefor; (c) The sanitary or housing conditions relating to or surrounding the work; (d) The existence or nonexistence of any strike, lockout, or other labor dispute affecting it and pending between the proposed employer and the persons then or last engaged in the performance of the labor for which the employee is sought.”
Labor Code Sections 971 and 972 provide for penalties against employers who violate Section 970. Section 971 states that “Any person, or agent or officer thereof, who violates Section 970 is guilty of a misdemeanor punishable by a fine of not less than fifty dollars ($50) nor more than one thousand dollars ($1,000) or imprisonment for not more than six months or both.”
Section 972 states that “In addition to such criminal penalty, any person, or agent or officer thereof who violates any provision of Section 970 is liable to the party aggrieved, in a civil action, for double damages resulting from such misrepresentations. Such civil action may be brought by an aggrieved person or his assigns or successors in interest, without first establishing any criminal liability.”
In addition to the statutory penalties, the case law has developed such that there now exists an action for employer fraud in the recruitment and employment process as a species of fraud in the inducement. As such, an employee like you, in addition to bringing the claims under the Labor Code can claim that they entered into an employment relationship based upon reliance on fraudulent misrepresentations made during the hiring process. Under the fraudulent inducement theory an employee so defrauded may recover, in addition to the statutory penalties, emotional distress damages and, possibly, punitive damages.
So, if anyone is being wooed, in a charm offensive, make sure to not only do your due diligence, but also get the promises in writing so that you can prove the statements made to you.
Nicole, I hope this helps you understand your situation better. Given the rapid explosion of startup companies here in California, my office's employment division has handled many such cases. You should get more detailed advice from an attorney who has had the opportunity to review all of your facts and, if you can't work the issue out with your employer, then get yourself a good trial lawyer to fight for you.
Christopher B. Dolan is owner of the Dolan Law Firm. Email questions to firstname.lastname@example.org.
Before accepting a new job, be sure to ask for a contract so you can prove statements made to you.