Many attorneys will say money cannot be the subject of a conversion claim because it is not tangible.
They are wrong. As reflected in this court order approving a conversion lawsuit for unpaid wages failing to pay an employee wages can subject an employer to a conversion lawsuit.
There must a definite, specific sum of money involved.
For wage issues, this will almost always be situation, meaning every employer facing a wage claim can also be sued for conversion.
Conversion is a claim for interference with property. The issues needed to prove conversion are:
1. The plaintiff possesses personal property.
A general claim for money cannot be the subject of a conversion claim.
2. The defendant intentionally and substantially interferes with that property, or takes possession of the property, or destroys the property, or prevents plaintiff from accessing their property, or refuses to return to the plaintiff their property.
3. Plaintiff did not consent to defendant's action.
4. Plaintiff was harmed as a result of defendant's conduct.
However, if the money is a specific amount that can be identified then one can sue for conversion.
For a wage claim, the employee's hourly wage multiplied by the number of unpaid hours is a specific amount of money.
Why Make a Conversion Claim?
Employees can already sue for unpaid wages under the labor code, and recover attorney's fees if they win.
The attorney's fee remedy will usually make labor code claims more enticing to pursue.
A conversion claim, though is an intentional tort with the possibility of recovering punitive damages.
Additionally, if it was foreseeable to the employer that the employee would suffer additional damage, liability may exceed the amount of the wages.
A plaintiff can also recover damages for emotional distress.
The end result is additional pressure on the employer to pay the wages owed, plus the employee's attorney's fees. The risk of the conversion claim, which is typically not covered by insurance, may force the employer to pay even more to settle a claim.
Paying Final Wages
Employee Expense Reimbursement
Sample Trial Court Ruling on Conversion Claim for Unpaid Wages
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