What is Job Inducement? Can it Affect how much Severance I get?

By Matt Lalande in Employment Law, Wrongful Dismissal on September 28, 2021

What is Job Inducement?

The job description sounded amazing. The head-hunter kept calling. You finally gave in, and accepted the invite to the interview. The employer raved about the position, how you would be a perfect fit for the job….and made all sorts of wonderful promises. A higher salary. More time off. More responsibility. A better position. A lucrative bonus. Enhanced benefits. It all sounds great. After numerous follow ups from the employer, you decide to quit your secure job and climb aboard, only to 1) realize the gig is nothing as described or 2) be fired a few months later.  The promises of greatness turned out to be worthless, and now, you’re in a terrible position…after leaving your long-time secure job that appreciated you and wanted you.

Employers must take care to not make misleading statements to job seekers – especially those job seekers whom it pursues. We get that hiring experienced executives or professionals can be tricky because the best performers are in high demand – but make no mistake, if your employer entices you to quit your position based on wine and dine promises it cannot or will not keep, you can sue that employer based on false promises – within the legal theory of inducement.

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When an employee has gives up a secure job to go to a new employer and is subsequently dismissed, a longer period of notice may be required, even though an employee is employed for a short period of time. This includes situations in which there is an element of “inducement”. The inducement, however, normally, must go beyond the ordinary degree of persuasion.  If a court finds that an employee has been hired based on false promises, inducement will be relevant for assessment of severance…but only when employee was terminated relatively early in the new position with the new employer.

If you believe that you have been induced from a previous position, only then to be fired, call our Hamilton Employment Lawyers today. We assist terminated employees all over Ontario.

Job Inducement Key Points

Have you been lured by false promises, only to be fired a short time later?

Remember, if you’ve been fired from your job, and you are non-unionized, you are not only entitled to minimum notice of termination (or pay in lieu) and severance as prescribed under the Employment Standards Act, but also, you are entitled to demand (or ask a Court) for more money to help you with your search for alternative equitable employment.   In other words, your employer has an implied common law obligation to provide you with reasonable notice of its intention to terminate the employment relationship, unless there is just cause for termination. If your employer fails to give you reasonable notice of termination, you can bring a wrongful dismissal action for breach of that implied term.

If you have given up a secure job to go to a new employer and are subsequently fired, a longer period of notice (more severance) may be required, even though an employee is employed for a short period of time. This includes situations in which there is an element of inducement.  You are entitled to make the argument of inducement as part of your wrongful dismissal claim. Again, the inducement allegations must go beyond the ordinary degree of persuasion.

How does a Court look at Job Inducement?

Normally, the effect of inducement

• varies depending upon the circumstances – each particular case is assessed individually. The significance applied to this factor is not the same from case to case;
• is left up to the discretion of the trial judge – or what the judge thinks or decides. In our experience, there is no definitive guideline as to how much inducement will affect the reasonable notice period. A court could attribute the years of service with the previous employer to the length of notice factor in the subsequent employment, and
• decreases over time – inducement may be considered as a factor when the termination of employment occurs very shortly after the employee is hired (most often, within the first two years); however, the significance of this factor diminishes over time.

What would normally be considered as “going beyond the ordinary degree of persuasion?”

It’s important to note that arguing “inducement” will not arise every time an employer dismisses a short-term employee who had long, secure service with a prior employer. An employee who willingly leaves their prior employment will not necessarily be induced. To constitute inducement, courts may look at factors such as:

• The new employer provides a promise of career advancement, greater responsibility, job security and compensation;
• The new employer makes promises of long term job security;
• The employer lures the employee away from their previous employment through the use of a head hunter or executive search organization.

When is inducement less likely to be found?

Inducement is less likely to be found where:

• The employee was not employed at the time of hiring;
• The employee’s prior employment was not secure;
• The employee’s prior employment was short term;
• The employee’s prior employment was part time but the new employment was full time;
• The employee earned substantially less than in their prior employment;
• The employee has been working for the new employer for a significant period of time;
• The employee was already looking for employment when discussions with their new employer began; and
• The employee applied to the new position through an advertisement.

Given the litany of litigation and caselaw over the past few years, employers today also know better – employers may be able to guard against an allegation of inducement by including a probation clause in the written employment contract. Probationary employment is understood by the parties to be unstable and tentative, and is inconsistent with the promise of long term job security required to prove inducement.  You cannot induce an employee or executive with promises, and then place them probation. It would be inconsistent with the theory of inducement.

What is the remedy for employees for employees who have been found to have been induced?

Where an employee gives up secure employment in reliance on a new employment opportunity and is subsequently dismissed, the individual may be entitled to a lengthier notice period in lieu of damages. Lengthier notice periods are applicable in instances where there is an element of enticement, or evidence that the employee gave up another job, his or her own company, business contracts or other remunerative or secure offers, in order to join the new company. The damages would be quantified in conjunction with your damages sought for payment in lieu of notice, based on a variety of factors, such as your age, term of service, current economic climate, the specialization of your position, among many more factors that we assess in determining your severance damages.

For example, in a 2004 case called Antidormi v Blue Pumpkin Software, the plaintiff was induced to leave a job she had held for only nineteen (19) months, on assurances and representations made by the defendant company. After approximately six (6) months of employment with the defendant company, the plaintiff was terminated due to an alleged change in company focus.

In this case, the Court stated that the reasonable notice period would have been ten (10) months, but due to the employer’s bad faith conduct after the termination, the Court awarded an additional two (2) months to the plaintiff, bringing the total to twelve (12) months, despite the short period of employment. In fact, the Court cited Wallace, and stated that employers were not to “play hard ball” with employees when dismissing them, and that this type of conduct, was a factor that warranted a higher notice period.

If you’ve been induced to quit your job, only to be fired, contact our Hamilton Employment Lawyers today.

The fact that an employer induced an employee to leave a secure, well-paying position which is no longer available to join that employer will increase the notice period.  There is a without a doubt, a rational presumption which infers that an employee would not leave a secure position unless the new job offered was reasonably secure. If you have been terminated after what you believe is inducement, call our law firm today.

We specialize in representing employees – particularly professionals and executives, as well as other full-time workers. Call our Hamilton employment lawyers today no matter where you are in Ontario at 1-844-LALANDE (525-2633) or local in the Burlington / Hamilton / Niagara areas at 905-333-8888 for your free no-obligation consultation or fill in a contact form, and someone will get right back to you.

LALANDE PERSONAL INJURY LAWYERS
1 King Street East, Suite 1705
Hamilton, On L8P 1A4
905-333-8888