Damages in California Wrongful Termination Cases

A wrongful termination can be a devastating experience for any employee. It refers to the act of firing an employee from their job for illegal reasons, which typically include discrimination, retaliation, or a breach of an employment contract. It occurs when an employer unlawfully terminates an employee’s employment, violating their legal rights and protections in the workplace.

Fortunately, California labor laws provide strong protections for workers who have been unjustly terminated from their jobs. If your termination violates certain laws or policies, you might be entitled to compensation through a California wrongful termination lawsuit. But what exactly can you recover in such cases?

In this blog, we will explore:

• The types of wrongful termination
• The recoverable damages in wrongful termination cases in California
• The various categories of damages
• Mitigation of damages, the legal process, and challenges in wrongful termination cases
• Recent legal developments in California Labor Laws

Types of Wrongful Termination in California

Before going into the details about recoverable damages in California wrongful termination cases, it’s crucial to understand the different types of wrongful termination that can occur in California. Employees in the state are protected from being terminated in violation of:

1. Discrimination Laws: Wrongful termination based on race, color, national origin, gender, religion, marital status, immigration status, medical condition, disability, or sexual orientation is prohibited under state and federal anti-discrimination laws. Employers also cannot discriminate or terminate any employee who is a victim of sexual assault or domestic violence.
   
2. Retaliation: Employees cannot be fired for exercising their legal rights, such as filing a complaint about sexual harassment at work or reporting illegal activities by their employer.
   
3. Breach of Contract: If there is an employment contract in place that specifies the terms and conditions of employment, any termination in violation of those terms can be considered wrongful.
   
4. Public Policy Violation: Dismissals that violate established public policy are wrongful. Examples include firing an employee for:
   
   • Reporting safety violations that endanger employees or the public.
   • Refusing to engage in illegal activities, such as fraud, embezzlement, or discrimination.
   • Exercising their legal rights, like taking leave under the Family and Medical Leave Act (FMLA) or California Family Rights Act (CFRA).
   • Serving on a jury or having a veteran status, as such absences, are protected under law.
   • Engaging in political activities outside of work hours or expressing their political beliefs, unless it interferes with job performance.

Recoverable Damages in California Wrongful Termination Cases

When an employee successfully proves wrongful termination in California, they may be entitled to recover damages when pursuing legal action. These damages typically fall into two main categories:

Economic Damages

• Back Pay: This includes the wages and benefits the employee would have earned had they not been wrongfully terminated. It encompasses both past and future earnings.
  
• Loss of Benefits: Wrongfully terminated employees can seek compensation for the loss of health insurance, retirement benefits, and other perks that were part of their employment package.
  
• Front Pay: In cases where it is not feasible to reinstate the employee, they may be entitled to front pay, which covers the expected future earnings the employee would have received if not for the wrongful termination.
  
• Unpaid Wages: This can include regular wages, overtime pay, commissions, bonuses, and any other compensation that the employee earned but did not receive due to the wrongful termination.

Non-Economic Damages

• Pain and Suffering: While less common in wrongful termination cases compared to personal injury claims, employees can sometimes claim for emotional distress damages. It can also include compensation for humiliation and mental anguish caused by the wrongful termination.
  
• Punitive Damages: In cases of extreme misconduct by the employer, punitive damages may be awarded as a form of punishment and deterrent. These damages are intended to be substantial and are not based solely on the employee’s losses.

Calculating the Damages for Lost Wages and Employment Benefits

When an employee successfully convinces a jury of their wrongful termination or wrongful constructive termination, they should be entitled to receive compensation for the income and benefits they lost during the course of their employment.

There is no average settlement as there are several factors to be considered when calculating the damages for lost wages and employment benefits. The compensation calculation might include the following components:

• Past lost wages: The total value, adjusted for inflation, of the wages or salary, along with the value of any benefits, such as health insurance, which the employee-plaintiff would have earned from their employer. This calculation starts from the date of the wrongful termination and extends until the date when the court reaches a verdict.
  
• Future wages: Additionally, the calculation encompasses the value, adjusted for inflation, of wages or salary and benefits that the employee-plaintiff would have received from their employer starting from the date of the court’s verdict, continuing for as long as it can be reasonably assumed that their employment would have continued.
  
• Lastly, the damages may also include any other contract-related losses resulting from the adverse actions of the defendant-employer.

Future lost wages and benefits can be a challenging figure to determine because it’s impossible to predict with certainty how long the employee would have remained employed had they not faced wrongful discharge. However, various factors can be considered when making this estimate, including:

• The employee’s age, their work performance, and their intentions regarding their tenure with the employer.
• The likelihood that the employer would have continued its operations, including the employee’s role.

For example, let’s consider a case involving Elizabeth, a long-standing nurse at a private medical facility. After many years of dedicated service, and as she nears retirement age, Elizabeth is suddenly dismissed without cause.

Elizabeth decides to seek legal representation from an employment lawyer and files a wrongful termination lawsuit. The jury finds that there existed an implicit understanding between Elizabeth and the medical facility regarding her ongoing employment.

As a result, the jury awards Elizabeth compensation equivalent to her lost pay and benefits for the duration since her wrongful termination. Given that Elizabeth is slightly younger than the typical retirement age for nurses, the jury also grants her compensation for an additional three years. This additional compensation is based on the assumption that she would have likely continued working for that duration if she had not been wrongfully terminated.

Mitigation of Damages

Mitigation of damages in employment-related lawsuits essentially involves the pursuit and acceptance of alternative employment to offset some of the financial losses resulting from wrongful termination.

In any California wrongful termination case where an employee is granted compensation for lost wages and benefits, the court will consider the extent to which the employee either did or could have “mitigated damages.”

This means that the damages awarded in a wrongful termination lawsuit will be decreased by the amount the employee actually earned or could have earned in a job duties that closely resembled the one they lost.

California employment law mandates that individuals must “mitigate damages” by actively seeking employment comparable to the position they lost. However, the damages an employee receives in a wrongful termination lawsuit will only be reduced if the employer can establish the following conditions:

1. Substantially similar employment to the employee’s former job was accessible to them.
2. The employee failed to make reasonable efforts to search for and retain such employment.
3. The potential earnings from such employment.

It’s important to note that the burden of proving the necessity for a mitigation-of-damages requirement rests with the employer and not with the employee, who is not obligated to demonstrate an inability to mitigate damages.

Factors that are relevant in determining whether a particular job qualifies as “substantially similar” to the employee’s former position include:

• The nature of the work.
• Whether the new role significantly differs from the previous one.
• Compensation, benefits, and working hours associated with the new job.
• Qualifications, background, and experience required for the new job.
• Job responsibilities in both the old and new positions.
• Geographical proximity of the new job to the previous one.

For instance, let’s revisit the scenario involving Elizabeth from our earlier example. If Elizabeth does not secure a new job following her wrongful termination as a nurse, her former company may argue that her compensatory damages should be reduced because there were available positions as nurses at similar medical facilities. They may assert that Elizabeth is qualified for these positions and should have accepted one to mitigate her damages.

However, if Elizabeth consults with an employment attorney, they may counter this argument by asserting that available nurse assistant positions are not substantially similar to her previous job. They may point out that these roles do not require the same level of education and experience that Elizabeth possesses. Additionally, these positions typically offer lower pay and are often part-time.

Consequently, the jury might determine that Elizabeth was not obligated to mitigate damages by accepting one of these positions, and therefore, her damages award would not be reduced by the potential earnings she could have received from such positions.

Legal Process for Pursuing Recoverable Damages

If you are determined to pursue legal action through a California wrongful termination case, the process typically involves:

1. Filing a Complaint: The first step is to file a complaint with a relevant government agency, such as the California Department of Fair Employment and Housing (DFEH) or the Equal Employment Opportunity Commission (EEOC) for federal claims.
   
2. Investigation: The agency will investigate the complaint and may attempt to mediate a resolution between the parties involved.
   
3. Right to Sue: If the agency does not resolve the issue, the employee will receive a right-to-sue letter, allowing them to pursue their case in court.
   
4. Lawsuit: The employee can then file a lawsuit against their former employer. This is where they can seek recoverable monetary damages, and the case may go to trial if a settlement cannot be reached.

Challenges and Considerations

Filing a wrongful termination claim in California can be complex. Some challenges and considerations include:

• Independent Contractor Status: If an individual is classified as an independent contractor, they may not qualify to file a compensation claim or lawsuit under California’s wrongful termination laws.
• Statutes of Limitations: The time period within which an individual can file a wrongful termination lawsuit in California varies depending on the nature of the claim. Specifically, there is a 2-year statute of limitations for cases involving implied breach of contract or violations of public policy, and a 3-year statute of limitations for cases involving violations of the FEHA (Fair Employment and Housing Act), WARN Act violations, or retaliation related to whistleblowing of illegal activities in the workplace. 
• Gathering Evidence: The collection of supporting evidence is pivotal, encompassing documents, emails, witness statements, company policies, performance review copy, and more.
• Legal Representation: Enlisting the services of an experienced wrongful termination attorney is not only valuable but often crucial for success in these cases. Here’s why:

1. Expertise and Knowledge: Wrongful termination laws can be complex. An experienced wrongful termination lawyer possesses in-depth knowledge of these laws and understands the nuances that can make or break a case.
   
2. Case Evaluation: An experienced employment law attorney can assess the strength of a valid claim, helping you understand whether pursuing legal action is a viable option. They can provide an honest evaluation of potential outcomes, helping you make informed decisions.
   
3. Negotiation Skills: Attorneys can negotiate with your employer or their legal representatives to reach a favorable settlement, potentially avoiding a protracted court battle.

4. Litigation Experience: In the event that a settlement cannot be reached, attorneys are well-equipped to represent you in court. They understand the legal procedures and can present a compelling case on your behalf.
   
5. Protection of Rights: An experienced attorney can help ensure that your rights are protected throughout the legal process, preventing any further harm or retaliation from your employer.
   
6. Maximizing Compensation: Experienced employment attorneys work diligently to secure the maximum compensation possible, including back pay, front pay, emotional distress damages, and attorney’s fees.
   
7. Emotional Support: Going through an unlawful termination can be emotionally taxing. Having an attorney by your side provides reassurance, support, and guidance during a challenging time.
   
8. Legal Strategy: Attorneys can develop a tailored legal strategy for your specific case, increasing the likelihood of a favorable outcome.
   
9. Timeliness: Legal proceedings often have strict deadlines. Attorneys ensure that all necessary paperwork is filed correctly and on time, preventing your case from being dismissed on technical grounds.

Wrongful Termination is Illegal. Your Rights Matter.

California wrongful termination cases can result in recoverable damages for employees who have been unlawfully dismissed from their jobs. Understanding the types of wrongful termination, the categories of damages, the mitigation of damages, the legal process, and recent legal developments is crucial for anyone navigating this challenging and often emotional process. If you believe you have been wrongfully terminated, seeking legal advice from a reliable wrongful termination lawyer is a vital first step in pursuing justice and recovering the damages to which you may be entitled.