Inducement may lead to damages

Date: 2007
Author: Daniel A. Lublin
Publication: Metro
Given big promises, offered big money and assured long-term job security, sales all-star Melissa Antidormi still wasn’t about to roll the dice with her career. But on the other hand, U.S-based Blue Pumpkin Software Inc. wasn’t about to take no for an answer.
Blue Pumpkin spent its time and energy recruiting Antidormi for over a year and its persistence and persuasion finally paid off. In turn, Antidormi left a well paying and secure position to join Blue Pumpkin with promises that the sky was the limit and her job would be safe for years. But some promises are made to be broken. Citing financial reasons, Blue Pumpkin fired Antidormi 6 months after hiring her. In the end, the company spent more time pursuing her than it did employing her.
Typically in cases of short-term employment, courts will not hold employers responsible to provide lengthy termination packages. However, after hearing her claim for wrongful dismissal, the Ontario Superior Court awarded Antidormi her salary for a 10 month period despite the fact she had only worked at Blue Pumpkin for 6 months. The unusual result stemmed from the fact that the judge accepted Antidormi’s claims that she would not have left her previous job had it not been for Blue Pumpkin’s promises of job security and their commitment to her future.
Our courts consider a number of factors in assessing the amount of damages to award an employee who was terminated and not given appropriate notice. As the Antidormi and Blue Pumpkin case demonstrates, courts apply the principle of “inducement” to punish employers who persuade employees to leave stable jobs and, for one reason or another, dismiss them shortly thereafter. If inducement is proven, the new employer may be on the hook for the employee’s service with the previous employer.
However, inducement is not a factor in every case where an employee was lured or recruited away from a position. There is an inherent level of salesmanship in every recruiting process and many employees are looking to jump ship. So how can you tell if you’ve been induced or if you were merely were a “willing inducee”?
Generally, inducement is only relevant if an employee was truly enticed to resign from a secure job based on promises of job security, career advancement and greater responsibility or pay. However, in one recent case, the court found that “encouragement” was a form of inducement as long as it was at a level beyond that inherent in the everyday hiring process.
Even if there was inducement, courts tend to place a time limit on when an employee can successfully make such a claim. Previous cases suggest that the effect of inducement is diminished where the employee works for at least 2 to 4 years with the new employer, although, I am aware of the odd case where inducement was proven many years after the fact.
If the employee was considering leaving the position or was proactively seeking employment with the recruiting company, claims of inducement will not likely succeed.
Employees can actually contract out of ability to claim inducement if there is a valid contract stating the amount of notice upon termination. Some contracts even ask the employee to acknowledge that they were not induced.