Message from the Firm

The average 1996 California jury verdict in employment law cases was $1.4 million, about twice the average in 1992, according to a survey of reported verdicts. The size of the verdict, and corresponding employer risk, continues to depend on the claim asserted by the employee. Discrimination cases, such as age, sex and race, had the highest average verdict of $1.9 million. Breach of implied contract (i.e., to demote or terminate only upon good cause) cases had the "lowest" average of $770,000. Even worse, another survey exposing jurors' mindset revealed that 80% of jurors believe that a company is negligent if it prepares no documentation prior to firing; 74% believe that warnings are required before a termination; 40% would punish a company that followed the letter, but not the "spirit" of the law; and 36% would award punitive damages even if the harm was not intentional.

Fortunately, most lawsuits are disposed of before trial by a defense that positions the case for settlement or summary judgment. Employers win at trial about half the time. Yet, when an employer loses, it can lose big. An employer's best defense is to manage their business to reduce claims and resolve them before they mature into lawsuits. Implement well drafted and understandable employment policies and procedures. Clearly communicate with employees about problems and expectations. Immediately investigate claims internally. Make fair decisions. Document everything. Consider a speedy resolution outside the courts through arbitration or mediation. Consult with experienced employment law counsel.

Learn more about Reish Luftman Reicher & Cohen's related practice areas:
Employment Law