Consumer Law

Minnesota Attorney General Sues Employment Agency

A lot of people are looking for jobs these days. And they're doing more than looking through classified ads in the paper and searching online. Rather, they're paying employment agencies to help them in the job search. Recently, the Minnesota attorney general sued one these agencies, claiming that it violated consumer fraud and deceptive trade practice laws. The lawsuit should serve as a warning that you need to be careful when choosing to an employment agency.

The Suit

According to Lori Swanson, the Minnesota Attorney General, the Arthur Group, Inc. (the "Group"), and its owner and chief executive officer, Barry Trimble, charged unemployed people in Minnesota up to $4,500 for assistance in finding a job and then did little or nothing at all to actually help them.

The lawsuit claims that the Group and Trimble did many things that were fraudulent and deceptive, such as:

  • Luring job seekers to come to its office for a job "interview" by posting an online ad for a lucrative job, and when someone showed up for the interview, he'd be told that the position had been filled and was no longer available
  • Not giving some job seekers a single job interview or employment lead, even after they had paid for the Group's services
  • Misrepresenting the Group's success rate for placing its client's in jobs and how quickly the Group could find someone a job
  • Misleading some job seekers into believing that the employers the Group found for them would pay back the fees the job seekers had paid to the Group
  • Promising some job seekers exclusive access to hundreds of employers and jobs that weren't publicly advertised, but failing to produce any actual interviews or job leads
  • Not providing the resume-writing services that some job seekers had paid for

The lawsuit wants the Group and Trimble to give back the money taken from the job seekers (called restitution), an injunction barring the Group and Trimble from doing the same thing in the future, and other money damages.

Consumer Fraud and Deceptive Business Practices

Generally, consumer fraud and deceptive business practices laws protect the public from being tricked or duped by businesses. For example, these laws make it illegal for a business to misrepresent or lie about its ability to do something or the quality of its goods or services. In a nutshell, a business can't take your money without delivering the goods or services that it claimed to have when you bought it.

That's what the Minnesota attorney general claims the Arthur Group and Trimble did. They bilked thousands of dollars from job seekers without delivering on their promise to help them find jobs.

Every state has laws on consumer fraud and unfair or deceptive trade practices to protect the general public from unscrupulous business tactics. As you can see in the case against the Arthur Group, the attorney general in your state enforces these consumer protection laws. Also, many states have consumer protection agencies to help consumers who've been victimized.

There are federal laws, too. The Federal Trade Commission (FTC) is the nation's consumer protection agency. The FTC's Bureau of Consumer Protection enforces many of the federal consumer protection laws.

Protect Yourself

The old adages, "Buyer beware!" and "If it sounds too good be to true, it probably is," apply here. Before you invest your money in an employment agency, you should make sure the agency is reputable:

  • Find out how long its been in business. You may be able to find this information by searching the secretary of state's business records in your state, or with your state's department of labor and industry
  • Ask the agency for references from employers and hiring mangers that have used the agency to fill positions. And ask for references from job seekers that agency has placed in jobs. Contact these references for their opinions of the agency. Be suspicious if the agency is reluctant to give out references or gives you only a few
  • Ask very specific questions about what services the agency will provide for the fees you're paying. Be suspicious if the agency offers you access to jobs that the general public doesn't know about, or "guarantees" that it will find you a job within a certain amount of time

If you think your rights as a consumer have been violated, you should contact your attorney general's office and consumer protection immediately. Minnesota's attorney general got involved in the Arthur Group case after receiving dozens of call and complaints from job seekers who were bilked. Today, the Arthur Group's Web site and its job postings are no longer online, the Group and Trimble can't cheat anyone else. But that doesn't mean there aren't other shady "employment agencies" out there looking to take your money. Be cautious, and if you see something suspicious, help yourself and your fellow job seekers by reporting it.

Questions for Your Attorney

  • I and at least 10 other people I know think that an employment agency is scamming us. Can we all hire you to sue the agency to get our money back, or do we have to file a complaint with the attorney general?
  • Do employment agencies have to have a license or employees with specialized training and education, or can just anyone open a business to help people find jobs?
  • Can an employment agency "blackball" me, that is, intentionally refuse to send me on job interviews with certain companies because of some bad references from past employers?
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