110 | 2024 Cal-Peculiarities ©2024 Seyfarth Shaw LLP www.seyfarth.com Many states refuse to use the doctrine of promissory estoppel to aid an employee who leaves a job to accept an at-will job that never materializes. In California it’s different. Even if the plaintiff has left an at-will employment, the California employer inducing the plaintiff to leave another’s employ can be liable under theories of promissory estoppel304 or promissory fraud305 for the income the plaintiff lost by leaving the prior employer in reliance on the new employer’s pre-hire promises. A California court held that a plaintiff who was hired by an at-will employer with false promises of compensation, and who was fired six months later for complaining about the broken promises, could recover the compensation that he would have earned with his former employer, which would have re-hired him but for its strict no-rehire policy.306 In 2022, the Court of Appeal held that an at-will employee could not rely on any promises about how long he would be employed because the employee’s at-will employment status rendered such reliance unreasonable as a matter of law. The employee could base his lawsuit on alleged misrepresentations during the interview about the nature of the employment being offered, however, including whether the employer knowingly misrepresented that the employee would be hired to fill the role of lead project manager for the company. As a result, the Court of Appeal reversed the lower court’s grant of summary judgment.307 5.9.2 Employer liability for too-generous references: negligent referral A California employer that gives a reference praising a former employee, while failing to report facts showing the employee’s dangerous tendencies, may be liable for intentional or negligent misrepresentation. A school district that praised a former employee for his ability to work with children, while failing to report his misconduct with children, was subject to a misrepresentation suit by a child whom the employee molested in his new employment. In this situation, the school district presented “misleading half-truths” and was obligated to complete the picture by disclosing material facts regarding charges and complaints regarding the former employee’s sexual improprieties.308 5.9.3 Employer liability for blackballing Labor Code sections 1050-1054 make an employer liable for treble damages and a misdemeanor criminal penalties for misrepresentations to prevent a former employee from obtaining new employment. However, an employee may not be able to recover both statutory treble damages and punitive damages, as this would constitute an impermissible double recovery.309 5.10 Employer Liability for Employee Torts 5.10.1 Negligent retention of wrongdoing employees An employer is liable for injuries to third parties caused by an employee whom the employer retained while knowing of the employee’s known propensities to cause such harm.310 5.10.2 Intentional torts by employees The traditional rule is that an employee’s actions are within the scope of employment—and thus binding on the employer—only if they are motivated, in whole or part, by a desire to serve the employer’s interest. Deviating from this rule, California courts have expanded employer liability by reasoning that an employee’s willful, malicious, and even criminal torts can fall within the scope of employment. In California, the employer is vicariously liable for an employee’s conduct—even if that conduct is not authorized or ratified—if the employment predictably creates the risk that employees will commit torts of the type for which liability is sought. The Court of Appeal applied this expansive notion of tort liability in holding that an auto-supply store could be liable to a customer who had been assaulted by the store’s employee. The employee had hit the customer in the head with a metal pipe when the customer criticized the employee for giving an inadequate response to a
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