In a recent California Court of Appeal decision, the court held that an employer may be liable to an at-will employee who moves to accepts a new job position and is then laid off 5 months later, when the company’s description of the kind or character of the job was misleading. In White v. Smule, the Court of Appeal reversed a trial court decision in favor of the employer after the trial court concluded that an at-will employee could not, as a matter of law, rely on an employer’s promises of long-term employment. However, the Court of Appeal held that although an at-will employee many not relocate to a new job with an expectation of long-term employment, an at-will employee could nevertheless rely on any employer’s misrepresentations regarding other aspects of the promised employment to state a claim for violation of Labor Code Section 970, including the kind and character of the job position.
Labor Code Section 970 prohibits employers from inducing an employee to relocate with in the State or to move to California to accept employment with knowingly false representations regarding the length of employment or the kind, character or existence of work. The Smule decision establishes that an employer may not rely on an at-will provision as an affirmative defense to an employee’s claim Section 970 based on misrepresentation of the kind, character or existence of work. The Court of Appeal held that even in the context of at-will employment, an employer may still violate Section 970 by making knowingly false statements regarding job duties, job title, compensation, working hours or benefit.
To avoid liability under Labor Code Section 970, it is therefore recommended to carefully develop and utilize an expanded at-will provision in any offer letter, employment agreement or employee handbook, that makes clear that in addition to the parties right to terminate the employment relation at any time with or without cause, the employer may also at any time and for any reason whatsoever, modify or change the kind, character or existence of the employee’s work.
Click the link below to read the White v. Smule Court of Appeal decision. http://case.lawmemo.com/ca/white1.pdf
