BUSINESS BRIEF:

QUARTERLY EMPLOYMENT LAW

UPDATES

May an Employee Recover Unpaid Wages in a Conversion Lawsuit, Inclusive of Emotional Distress Damages? 

SUMMARY: The employee agreed to work for both wages and an ownership interest in the company.  When the company did not pay the Employee, and withheld the stock certificates, the employee sued under traditional wage and hour laws and under the common law claim of civil theft called “conversion.”  The Court of Appeal recognized that adequate remedies already exist in the Labor Code for unpaid wages and refused to extend the tort of conversion to claims for unpaid wages. 

QUESTION FOR THE SUPREME COURT: The California Supreme Court will decide whether an employee can recover wages through a claim for civil theft, or conversion.  If the decision is in the affirmative, managers and other officers of companies could be personally liable for unpaid wages and other damages.  Voris v. Lampert.

Please contact Phillip Maltin for further information about these cases pending before the California Supreme Court.

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