California Employee Can Proceed with Claim of Falsely Represented Job Offer

​Despite his at-will status, a former employee may proceed with a lawsuit under the California Labor Code alleging that his employer intentionally misrepresented the nature of the work he was expected to perform, a California appeals court ruled.

California Labor Code Section 970 prohibits employers from persuading job candidates to accept employment and relocate by making knowingly false representations about the kind, character or existence of work (or the length of time such work will last).

The employer in this case develops and markets consumer applications with a specialty in music social applications.

Before the plaintiff accepted the job, the employer told him the company had significant problems with its development process, was not operating efficiently and needed an experienced project manager to help growth. It said it also needed the experienced project manager to train, supervise and recruit other experienced project managers.

The employer wanted the plaintiff to develop a functional project management team that would enable the employer to grow its business, and it wanted the plaintiff to join the company to reorganize the company's project management operations and enable it to grow and operate more efficiently.

The plaintiff said he wanted a director title, and the employer agreed to the title of lead project manager. The plaintiff also said he was only interested in a secure, long-term position where he could grow with a company expanding its business, and the employer said that was exactly what it was offering.

The plaintiff claimed that the employer's representations induced him to resign from his employment and move his family to the Bay Area. Five months after his start date, the employer eliminated his job and ended his employment.

The plaintiff sued, alleging a violation of Section 970 because the representations the employer made to him about the nature of his job were false and the employer knew they were false.

The employer noted that the company had an employment-at-will relationship with its employees, which meant that it was entitled to terminate the plaintiff's employment at any time and for any reason. The plaintiff asserted that he was not claiming wrongful termination but was alleging that specific representations were made to him as to the nature, kind and character of the work he was being hired to perform and the length of time the work would require. He claimed that a jury could reasonably find that the employer never intended to have him perform the job functions represented to him during the recruiting process.

The lower court dismissed the lawsuit, finding that the plaintiff was an at-will employee and could not reasonably rely on the employer's representations.

The appeals court disagreed and ruled that the plaintiff could take his claim to trial.

Proving a Section 970 Claim

To prevail on a Section 970 claim, the court said, a plaintiff must prove that:

• The defendant made representations to the plaintiff about the kind or character of the work, or the length of time the work would last.
• The defendant's representations were not true.
• The defendant knew when the representations were made that they were not true.
• The defendant intended that the plaintiff rely on the representations.
• The plaintiff reasonably relied on the representations and relocated for the purpose of working for the defendant.
• The plaintiff was harmed.
• The plaintiff's reliance on the defendant's representations was a substantial factor in causing the plaintiff's harm.

The appeals court found that there was enough evidence for a jury to conclude that the employer made misrepresentations to the plaintiff about the tasks he was being hired to perform, the goals he was to achieve and the time it was expected for him to achieve those goals. The court also found that the plaintiff relied on these representations in accepting the employment offer.

As an at-will employee, the plaintiff could not rely on any promises about how long he would be employed; however, he could base his lawsuit on the alleged misrepresentations about the nature of the employment that was being offered.

An at-will employer "does not have carte blanche to lie to an employee about any matter whatsoever to trick him or her into accepting employment," the court said.

White v. Smule, Calif. Ct. App., No. A161858 (Feb. 18, 2022).

Joanne Deschenaux, J.D., is a freelance writer in Annapolis, Md.