What is a Conflict of Interest in Employment Law? | Bantle & Levy



What is a Conflict of Interest?

As employment law attorneys, understanding and addressing conflicts of interest is essential to successfully managing a case. A conflict of interest can hurt a case if a client doesn’t disclose it and/or it’s improperly managed. At the same time, a conflict of interest on the part of the opposition can form the backbone of our legal position.

If used strategically, a conflict of interest can be used to highlight the bias or unprofessional behavior of one side of a legal case. An experienced attorney can accurately identify and navigate these conflicts to ensure they don’t hurt your case, or help you win. The employee rights attorneys at Bantle & Levy will explain what a conflict of interest is and share examples of when a conflict of interest would come up in an employment law case in ways that both help and hurt the employee.

What is a Conflict of Interest?

A conflict of interest is a situation where a person’s personal or financial interests interfere with their professional duties and responsibilities. When this happens, there is or was a possibility for someone to make decisions that benefit themselves or their close associates rather than the organization they are working for. Conflicts of interest can arise in various settings, especially the workplace.

Sometimes, depending on the situation, a conflict of interest – if not reported – can even be illegal, making it all the more important to highlight when you’re the victim of one, or could potentially have one.

Conflict of Interest in Employment Law Cases

Conflicts of interest can arise in any work environment, regardless of the industry or position someone holds. However, there are certain situations where they are more prevalent and can have severe consequences if not properly addressed. If you are the victim in any of these situations, you may have a strong foundation for a legal suit, likely against your employer and/or supervisor.

Hiring Process

During the hiring process, employers have a responsibility to ensure that they are making unbiased and fair decisions based on an individual’s qualifications and skills. This may not be possible if a hiring manager has a close personal relationship with one of the candidates thus creating a conflict of interest depending on the relationship.

In this situation, the hiring manager could feel inclined to give preferential treatment to their friend or family member rather than choosing the most qualified candidate.

Outside Employment

Many companies have policies in place that restrict employees from engaging in outside employment that may pose a conflict of interest.

For example, if an employee works for a pharmaceutical company, it would be considered a conflict of interest if they also worked for a competing pharmaceutical company, or another medical company overall. This is because their actions and decisions could potentially benefit one company over the other. While people do that in secret, they may find themselves facing a lawsuit from one of their employers.

If you financially need two forms of employment, be careful and avoid having two employers in the same industry/field.

Financial Interests

Someone’s personal financial interests can also create conflicts of interest in employment law cases.

For example, if an employee has a significant investment in a competitor of their employer or holds stocks in a company that their employer is considering acquiring, it could potentially influence their decisions and harm the interests of their employer. Their employer could be legally justified in firing them.

Gifts and Favors

Accepting gifts or favors from clients or other people involved in the business can also create conflicts of interest. This is because the employee may feel obligated to return the favor or make decisions that benefit the gift-giver rather than what is best for the company.

Promotions and Special Treatment

If a supervisor has a relationship of some kind with an employee below them – even a platonic friendship – they may have a conflict of interest.

For example, if there’s a job opening/potential for a promotion or raise, and that supervisor promotes the person they have a relationship with, many more qualified people have missed out on an important opportunity.

Impact of Conflicts of Interest

Conflicts of interest can have far-reaching consequences for both employees and employers. For employees, engaging in activities that create conflicts of interest can result in disciplinary action or even termination. This can harm their current job and impact their future career opportunities. Future employers will hear about how you created a conflict of interest in your prior employment and will be reluctant to trust you as their employee.

For employers, conflicts of interest can lead to legal issues and damage the company’s reputation. It can also create a toxic work environment and affect employee morale and productivity. In the most extreme cases, it can lead to employees filing lawsuits against you.

If you’re an employee who has been hurt by a conflict of interest on your employer’s part, contact the employee rights attorneys at Bantle & Levy.

Avoiding Conflicts of Interest

To prevent conflicts of interest, both employees and employers need to adhere to their responsibilities and be honest when a conflict of interest appears.

For example, if you are a hiring manager and you know one of the applicants personally, you should report that to your superior so you can be transferred to another project. If your employer refuses to move or change your assignment, they become responsible as well if a potential hire points out the conflict of interest. You have done what you are supposed to do and have created a foundation for a legal defense to protect yourself.

Contact the Employee Rights Attorneys at Bantle & Levy

Many conflicts of interest are out of your control. That doesn’t change the fact that whoever is responsible has to be honest about them. Even conflicts of interest on your part can be combatted by tackling them head-on in a line of defense.

If you are the victim of a conflict of interest with your employer, speak up. Our attorneys can help you get the justice you deserve or defend you when you did the right thing. For legal issues with conflicts of interest, contact our employee rights attorneys today.

Bantle & Levy
Bantle & Levy

Lee Bantle is a partner at Bantle & Levy LLP. He has extensive legal expertise, admitted to the bars of the U.S. District Court and the U.S. Court of Appeals. With a distinguished academic background and clerkship experience, he has been recognized as a top-rated civil rights attorney and esteemed lawyer. In addition to his successful career, he has actively contributed to various legal organizations and serves as a faculty member for NYU's Annual Workshop on Employment Law for Federal Judges.


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