New York is known for having many protections for its employees in the workplace, but a long-standing legal doctrine can furnish a remedy to employers with regard to employees who engage in repeated acts of disloyalty during their employment. The “faithless servant doctrine” permits an employer to “claw back” an employee’s compensation when an employee is found to be disloyal to the employer. While the doctrine may seem antiquated, it continues to have vitality. For example, in March 2018, a New York appellate court confirmed an arbitration award that directed, based on the faithless servant doctrine, a former employee to pay Major, Lindsey & Africa, LLC nearly $2 million as disgorgement of her past salary and commissions on claims that she had stolen and divulged confidential information to competitors.
