Loss of Earnings due to Wrongful Termination

In order to bring a lawsuit for wrongful termination, the terminated employee must show that s/he was terminated due to an illegal reason.  In California, examples of illegal reasons to be terminated include, being fired due to one’s race, religion, gender, sexual orientation and/or disability.  If a fired employee is able to establish that s/he was terminated for one of these reasons, then the fired employee would be entitled to certain damages.

One type of damages that an individual is entitled to in a wrongful termination lawsuit is loss of earnings.  This would include earnings that the fired employee lost from the date of the termination, through trial and into the future.  There is a catch, however.  In California, a fired employee has a duty to mitigate his or her loss of earnings.  What that means is that a fired employee has to make an effort to get a new job in order to reduce their loss of earnings damages.

In order to establish that a fired employee has made reasonable attempts to obtain new employment, the fired employee will need to provide applications for employment for positions similar to that which s/he held at her prior employment.  If the terminated employee was sales clerk at a retail store and then begins applying for pharmaceutical sales jobs, when s/he has no experience in pharmaceutical sales, this will not likely establish an attempt to gain new employment.

If the terminated employee does not make any attempt to gain employment, a jury or judge can make a decision that had the fired employee made an effort, s/he would have obtained employment by now.  As a result, the terminated employee is not entitled to any future loss of earnings.

In the event that the wrongfully terminated employee obtains employment after termination at a rate of pay greater than what s/he was earning with her former employer, the wrongfully terminated employee would not be entitled to any loss of earnings damages from the date that s/he obtained the new employment.

Similarly, if the wrongfully terminated employee obtained employment at a rate of pay less than what s/he was earning at the time his or her wrongful termination, the former employee would be entitled to the difference between what s/he was making at the time of his or her termination and what s/he is making at his or her new job. So for instance, if the former employee was making $20.00/hour @ 40 hours a week at her old job and $10.00/hour @ 40 hours a week at her new job, the former employee would be entitled to loss of earning of $400.00/ week from the time that the former employee obtained her new employment.

The length of time that the former employee would be entitled to the $400/week for damages is something that the judge or jury would decide.  One factor that will affect the length of time that the former employee will be entitled to future loss of earnings damages is his or her age.  Obviously, the older the individual, the less future loss of earnings s/he is going to be awarded because it will be fewer years before s/he retires.

It is important to remember that if you are wrongfully terminated, you have an obligation to look for work.  You cannot sit back and wait for a settlement or jury verdict to come in your favor.  If you do, your former employer will argue that you are not entitled to future loss of earnings because you could have found a job had you applied yourself.  Don’t let opposing counsel make this softball argument.  With online job applications, it is easy to apply for jobs.

If you have a wrongful termination case, contact the attorney at The Rinka Law Firm, 310-556-9653.

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