Demonstrating Failure To Discharge Plaintiffs Duty To Mitigate In A Wrongful Termination Case: An Empirical Approach

Abstract

In a wrongful termination case, the defendant has the burden of proving that the plaintiff did not adequately discharge his or her duty to mitigate damages.  The defendant may satisfy its burden by proving that the claimant failed to exercise “reasonable care and diligence” in seeking a job; and it must do so by a preponderance of the evidence.  On the other hand, the amount of any award turns on the difference between the plaintiff’s pre- and post-termination earnings.  Thus, there is a conflict between the potential increased damages award made possible by remaining jobless and the legal duty to mitigate.  It is reasonable to assume that a plaintiff may perceive an incentive to stay out of the workforce to enhance the damage award.  

In this paper we empirically establish the expected joblessness duration period for a plaintiff’s population cohort in a wrongful termination lawsuit; we also calculated the estimated duration period’s associated standard error.  To illustrate the procedure we discuss a hypothetical case study and use uncensored data on joblessness duration from the Bureau of Labor Statistics’ Displaced Workers Survey.

This process enables us structure a hypothesis test examining whether the plaintiff’s period of joblessness is statistically significantly different from the predicted test statistic in a manner consistent with case law.  Succinctly, we are able to empirically assess the soundness of the duration of a plaintiff’s job search and thereby enhance the robustness of present-day approaches.