Texas is an at-will employment state, as most states are. This means that in general both employers and employees can choose to end an employment relationship for any reason. Because this leaves the terms of employment very vague, many employers in the Houston area use employment contracts to further define employment relationships. Employees who are asked to sign contracts–such as non-competes, severance agreements and others–often benefit from having an attorney look over the contract first.
A Beaumont, Texas, woman recently sued her former employer accusing it of misleading her into agreeing to an unfavorable employment contract.
The woman signed an employment contract with the mortgage company in 2006 when she accepted a position as a branch manager. About one year later, she was asked to sign another contract, although the company reportedly did not tell her why.
A few short months later the office closed, reportedly leaving the woman without commissions she had earned as well as outstanding benefits.
The woman has now filed a lawsuit, accusing the company of asking her to sign a contract because it knew that it was being shuttered by the Federal Mortgage Regulation Board. She charges that the company engaged in breach of contract as well as fraud and negligent misrepresentation.
According to the Southeast Texas Record, she is seeking damages for the commissions and benefits that she was denied, as well as punitive damages and various fees.
This case should remind Texas residents that it can be important to have employment contracts reviewed by an employment law professional before signing them. Additionally, should a contract dispute arise, it is generally wise to seek legal representation.
Source: Southeast Texas Record, “Woman claims her employer misled her,” Kelly Holleran, March 1, 2013