Some North Carolina laws protect employees against employers, and some protect employers against employees. One North Carolina law, Chapter 95, Article 5A, "Regulation of Private Personnel Services," found at G.S. §§ 95-47.1 - 95-47.15, protects both employers and job applicants from shady dealings by personnel agencies.
The definition of "personnel agency" is tricky, as seen in G.S. § 95-47.1(16). It primarily refers to services where an applicant may become liable for the payment of a fee to the service, whether directly or indirectly. It excludes most temp agencies, but not all. It may apply to headhunter agencies, depending on their fee structures.
The law requires that such agencies be licensed and bonded. It allows job applicants to recover fees from the agency if those fees were based on commissions if the employee did not ultimately earn at least 80% of the amount of the commissions in question (G.S. § 95-47.3A(a). It also prohibits false or misleading statements or representations, including those to job applicants or employers (G.S. § 95-47.6(2), (8)-(9)).
Similar laws also govern job listing services (Chapter 95, Article 5B, "Regulation of Job Listing Services," found at G.S. §§ 95-47.19 - 95-47.32).
The power of these statutes lies in the fact that additional damages and attorney's fees may be available to successful plaintiffs. The North Carolina Supreme Court has ruled that making deceptive statements in violation of these statutes may also constitute a unfair or deceptive trade practice under North Carolina law, increasing the amount of potential damages significantly. See Winston Realty Co., Inc. v. GHG, Inc., 331 SE 2d 677, 678 (N.C. 1985).
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