Most workers in New Jersey are employed at will, which means that they can be fired for nearly any reason and at any time the employer chooses. However, employers can’t fire employees for illegal reasons, in breach of employment contracts, or in a way that violates public policy. Employees who are terminated for an unlawful reason have a right to pursue wrongful termination lawsuits. Through a lawsuit, an employee might receive compensation for the losses they have suffered because of their firing. Here’s what you need to know about compensation in a wrongful termination lawsuit from the attorneys at Swartz Swidler.
Wrongful Termination Settlements vs. Trial Verdicts
Filing a wrongful termination lawsuit does not necessarily mean that you will have to take your claim to trial. Instead, the vast majority of wrongful termination lawsuits are settled at some point before trial. Many are settled before a formal lawsuit is filed in court.
A wrongful termination settlement is a legally binding agreement to settle a claim for an agreed-upon amount of compensation the employer will pay to the employee who was unlawfully terminated. In exchange for accepting the settlement agreement, the employee will agree to not continue pursuing further legal action. The employee might also be bound by a non-disclosure agreement as a part of the agreement that prohibits them from discussing the terms of the settlement with others.
Employers and employees tend to prefer settlements instead of trials. This is because trials are risky for both employers and employees. If an employer loses a trial, it risks paying more money than it otherwise might have to pay and can also face reputational harm because of the publicity involved. If an employee loses a trial, the employee will be left without compensation for the losses they have suffered because of their wrongful termination. For this reason, reaching a negotiated settlement is typically in the best interests of both parties.
Available Damages in Wrongful Termination Lawsuits
Employees who have been wrongfully terminated are entitled to compensation for their damages. Damages are the losses the employees have suffered as a result of their illegal terminations and are meant to provide compensation for the different ways the employees have suffered losses.
Wrongful termination damages vary based on federal or state law. However, the following categories of damages are typically included:
- Back pay from the date of termination until the trial or settlement
- Front pay to compensate an employee for future lost wages when they haven’t been able to find a new position despite making active efforts
- Lost benefits
- Emotional distress damages
- Loss of the employee’s professional reputation
- Attorney’s fees and court costs
- Punitive damages when the employer’s actions were particularly egregious
Calculating the amounts of wrongful termination damages can be difficult. While some types of damages are economic and relatively straightforward to calculate, others are more intangible losses. An experienced employment lawyer can help to value a claim so that an employee can understand what a fair offer might look like.
What Is the Average Settlement for Wrongful Termination?
Each wrongful termination case is unique, and its value will be based on the facts and circumstances. Workers who settle their wrongful termination cases might recover compensation ranging anywhere from $5,000 to $100,000.
The following factors might influence the amount of compensation available in a wrongful termination settlement or verdict:
- The employee’s salary
- The benefits the employee earned as a part of their employment
- Whether the employee was able to find a new position
- The salary of the new position as compared to the former one if the employee found a new job
- How old the employee is
- The employee’s skills
- The employer’s conduct
- Whether the employer took steps to damage the employee’s reputation and harm their ability to find a new job in the future
- Whether the employee retained a wrongful termination attorney
Highly-paid employees who were fired in a way that clearly violates the law are likelier to recover higher amounts than entry-level employees.
Understanding Punitive Damages
Punitive damages are only awarded in cases in which an employer’s conduct was particularly outrageous. These damages are meant to punish an employer instead of compensate an employee and are paid in addition to the employee’s compensatory damages.
Punitive damages are only awarded in a case that goes to trial through a verdict. However, employers that face the potential of punitive damages might be motivated to settle the cases outside of court, which can lead to higher settlement offers.
Do Employers Typically Settle More Often Than Go to Trial?
Most employers try to reach a wrongful termination lawsuit settlement instead of fighting these cases at trial. They generally don’t want to face publicity and potential damage to their brands. It is also expensive to defend against a lawsuit all the way through trials. Because of these factors, most employers try to negotiate out-of-court settlements.
Consult a Wrongful Termination Lawyer
If you believe your employer illegally fired you from your job, you might have a legal right to recover compensation. An experienced attorney at Swartz Swidler can analyze what happened and help you understand the legal remedies that might be available. Call us at (856) 685-7420 to schedule a free case evaluation.
