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Accountemps Division of Robert Half of Philadelphia Inc. v. Birch Tree Group

Decided: March 31, 1988.

ACCOUNTEMPS DIVISION OF ROBERT HALF OF PHILADELPHIA, INC., PLAINTIFF-RESPONDENT,
v.
BIRCH TREE GROUP, LTD., DEFENDANT-APPELLANT



On appeal from the Superior Court of New Jersey, Law Division, Mercer County.

Shebell and Arnold M. Stein. The opinion of the court was delivered by Arnold M. Stein, J.s.c., (temporarily assigned).

Stein

Defendant appeals from a summary judgment awarding a placement fee of $12,000 to plaintiff, a Pennsylvania employment agency not licensed for that activity in New Jersey at the time of these events. We reverse because the collection of permanent placement fees by one not licensed by this State to conduct an employment agency is contrary to public policy.

The essential facts are not in dispute. Plaintiff Accountemps is a division of Robert Half, Inc., a private employment agency licensed in Pennsylvania, with principal offices in Philadelphia. Half specializes in the placement of accounting, financial and data processing personnel. Accountemps is its temporary placement division. Frequently, individual job applicants seeking permanent placement through Half will make themselves available for temporary positions with Accountemps.

On February 28, 1985, David Sengstack, defendant's president, telephoned the Trevose, Pennsylvania, office of Accountemps, seeking a comptroller in its Princeton office for a

three-to-six-month assignment. Susan Afan, plaintiff's office manager, explained the temporary placement procedure, including hourly rates for the temporary employee and the placement fee to be charged. Afan also advised that a permanent placement fee was to be charged if the employee's temporary placement became a permanent position. David Sengstack agreed to these terms, which were confirmed in writing by a letter from Afan dated March 11, 1985. Enclosed with the letter was a permanent placement fee schedule.

On that date, plaintiff sent Robert Patterson to fill the temporary comptroller position. Patterson worked in defendant's office as a temporary from March 11, 1985 until May 3, 1985. At the end of each week, a representative of defendant would complete and sign a card which showed the number of hours worked by Patterson. The time card contained the following paragraph above the employee's signature line:

In the event we employ this person in any capacity, and/or place him/her on our payroll during the temporary assignment or within one year of its severance, we agree to pay ROBERT HALF OF PHILA. INC. its regular placement fee.

On May 7, 1985, Gregg Sengstack, defendant's treasurer and business manager, telephoned plaintiff to advise that Patterson had been hired in a permanent accounting position at a $40,000 annual salary. On that same day, plaintiff sent defendant an invoice of $12,000 as a permanent placement fee, calculated from the schedule earlier sent by plaintiff to defendant. Defendant has paid all temporary placement fees in full, but refuses to pay this $12,000 permanent placement fee.

Neither Accountemps nor Half was licensed in New Jersey as an employment agency during the period of Patterson's temporary employment with defendant or at the time of his hiring on a permanent basis. N.J.S.A. 34:8-26. Since 1979, Accountemps has been authorized to do business in New Jersey as a foreign corporation, pursuant to N.J.S.A. 14A:13-1, et seq. In November 1985, after this dispute arose, Half became licensed to conduct a private employment agency in New Jersey, and

since that time has opened offices for itself and ...


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