Compliance May 6, 2001

Justices Exclude Front Pay from Damages Cap

June 5, 2001 (PLANSPONSOR.com) - The US Supreme Court has set a precedent, increasing damage awards for discharged workers who claim their dismissal was a result of illegal discrimination, in a sexual harassment suit filed against chemical giant DuPont.
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In a case involving a former Dupont employee whose damages award was capped at $300,000, but who claimed a further $800,000 in loss of future earnings, or front pay, the court ruled that the damages a damages cap imposed by federal race, sex and disability bias law does not limit front pay.

The ruling by Justice Clarence Thomas signifies a defeat for employers who argue that front pay awards are disproportionate to workers’ actual losses and urge the courts to include it under the compensatory and punitive damages cap to $300,000 in cases against large companies

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Proponents of the inclusive cap contend that the civil rights act, which imposes the cap, was meant to limit runaway damage awards. By moving front-pay awards out from under the cap, this measure of restraint no longer functions.

Nevertheless, the justices ruled that allowing unlimited front-pay is in line with the law noting that in the Civil Rights Act of 1991, Congress determined that victims of employment discrimination were entitled to additional remedies.

– Camilla Klein           editors@plansponsor.com

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