Don’t Be a Quitter: The Duty to Mitigate

An employee who is unlawfully terminated may be entitled to recover damages in a variety of forms, including front pay. Front pay can be a frightening prospect for the employer-defendant–just imagine having to pay a former employee for time he doesn’t work for you. Not pleasant.

But, as is the case in most employment laws, the rules tend to balance out in a fair way. An employee who claims she was unlawfully terminated because of her gender cannot merely sit at home indefinitely and wait to collect a big jury award. The law imposes what is called a “duty to mitigate,” which means that the employee has the duty to mitigate her losses.

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If an employee fails to look for work at all and, instead, elects early retirement, her damages are tolled. In other words, she will not be eligible for an award of front pay during any period in which she is not actively seeking work. The phrase used by the courts is that the employee must be “ready, willing, and able” to obtain employment. If, instead, she elects to stay home and watch soaps all day, she is considered to have withdrawn from the job market and, as a result, is ineligible to receive an award of front pay.

So, on one hand, if the employee makes constant and good-faith efforts to seek similar employment, she is eligible to receive front pay if victorious on her claims. On the other hand, she will receive no front pay if she voluntarily elects to remove herself from the job market. But, as with everything in the law, there are countless variations in between these two extremes.

For example, what if the employee decides not to look for work so she can stay home with her young children? But, once the kids are old enough, she elects to return to the workforce and begins again to actively seek employment? In the Third Circuit, which covers Delaware, Pennsylvania, New Jersey, and the Virgin Islands, she would not be able to collect front pay during the period when she stayed home but, once she started to look for work, she would be eligible for front-pay damages again.

And what if she elected to try a new career path and, in that effort, returned to college to complete her degree? In that case, the courts differ. Some say that she would still be eligible for front pay as long as she was ready, willing, and able to work. Others say that she could not be awarded front pay unless or until she returned to an active job search.
The cases are very fact specific and difficult to predict. However, at least in the Third Circuit, one thing is settled–an employee who makes no attempt to look for work after an allegedly unlawful termination is deemed to have voluntarily withdrawn from the job market and is ineligible for an award of front pay for that time.

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