In a tight employment market, an employer may be tempted to paint a deceptively rosy picture about future opportunities in order to attract scarce workers.
Misrepresentation is a state law claim.
Several employees at Cedarapids Inc. lost their jobs because the employer closed down the facility where they worked. The employees claimed that, at the time they were hired, management assured them the company was planning to expand that operation. Despite these assertions, the employees claimed, the company had already decided it would be closing the facility. The Ninth Circuit allowed the employees' suit for fraudulent misrepresentation to proceed.