What is the Faithless Servant Doctrine in Employment?

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The Faithless Servant
Doctrine allows employers to claw back compensation paid to an employee,
including salary, commissions and/or bonuses.

The Faithless Servant
Doctrine may apply if the employer can show that the employee, during the
course of their employment, engaged in repeated acts of disloyal conduct.
Examples of disloyal conduct that have been found to be actionable are
generally acts against the employer’s interest such as embezzlement, improperly
competing against the employer and/or usurping business opportunities. In order
to give rise to a claim under the Faithless Servant Doctrine, the employee’s
conduct is generally such that it substantially and materially impacts the
employer’s business or rises to the level of a breach of the duty of loyalty or
good faith.

If the Faithless Servant
Doctrine is found to apply, an employee may be required to forfeit all of
their compensation
(salary, commissions and/or bonuses) received during the
time period that the employee engaged in such conduct, regardless of whether
the employer can prove damages.

To find out more about
the Faithless Servant Doctrine and how this may affect your employment and
business opportunities or to find out what your rights and obligations are to
your current employer click here.