Wrongful Termination Lawsuits

A successful wrongful termination lawsuit can result in significant damages, penalties, and more. California follows the “at will” doctrine such that employers have the right to fire employees even if the employee is performing well and has done nothing wrong. However, it is unlawful to terminate an employee if a substantial motivating factor for the termination was prejudice based on a legally recognized characteristic, which is termed a “protected class.”

If an employee convinces a judge or a jury that the termination was “substantially motivated” by, for instance, the fact that an employee is a minority or the fact that the employee reported a violation of his rights, the company could be held liable for significant amounts of money because there are penalties, multiple types of damages, and more associated with wrongful termination claims.

The core monetary component of a wrongful termination claim is the amount of money the employee lost after being terminated. That is, the money the employee would have earned through regular paychecks but did not earn because he was fired. To take an easy example, imagine an employee works full-time for a salary of $50,000.00; the company tells the employee he is being terminated because he took medical leave. This is clearly a wrongful termination. If the employee cannot find a job for exactly 12 months despite trying to do so, the core component of damages for this case would be $50,000.00. If the employee found a job after exactly 6 months, the core component of damages for the case would be $25,000.00. Some people refer to this number as the “economic damages” or “hard damages.” When negotiating settlements, the hard damages often drive most of the discussion.

In addition to so-called hard damages, there are many other remedies available to workers. First, certain claims, including wrongful termination claims, can trigger punitive damages, which the Court may award to punish improper conduct. Second, emotional distress damages are possible and are often easier to get than punitive damages. Third, there can be significant penalties associated with wrongful termination claims. Fourth, interest will further increase the damages. Fifth and finally, an employee who wins a wrongful termination claim will generally be able to force the company to pay all attorney fee costs. This can be scary for a company because the attorney fees can be enormous and are often greater than all other damages combined.