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02/27/03 - Federal Courts May Not Prevent High Damages
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Part of the Civil Rights Act of 1991 involves damage caps to what a plaintiff can receive in punitive and compensatory damages. Though damage caps are opposed by some, due to the fact that punitive damages were established as a way to punish an egregious act by an individual, there are other areas of the law that have also instituted damage caps. However, in recent court cases, plaintiffs are finding ways around the federal limitations by appending state claims to the federal claims brought forth or by simply bringing the case in through state court first. Furthermore, there are workplace torts that allow employees to get even more damages in addition to the caps that are imposed on federal regulations.
As reported in a recent SHRM article in HRNews, in Gagliardo v. Connaught Laboratories, Inc. a plaintiff had both an ADA claim and a Pennsylvania Human Relations Act (PHRA) claim. The 3rd Circuit Court of Appeals used methods that the 9th Circuit and District of Columbia Circuit of Appeals have applied. In this case, the trial court awarded $2 million in compensatory damages under the PHRA claim and $500,000 in punitive damages under the ADA claim. The PHRA does not have limits to how much a plaintiff can receive. The 3rd Circuit upheld a majority of the damages by cutting the punitive damages by $300,000. One employment lawyer advised in the SHRM article that one way of avoiding such an apportionment is by educating the jury to think about how they divide the damages between claims. If the part of the claim assigned to the federal court is greater than the cap, the award is automatically reduced.
Despite the fact that there are ways of reducing state punitive awards, one of the best ways employers can avoid this fate is by focusing on creating best employment practices. Avoiding a costly lawsuit by preventing the illegal activities from the get go is the most productive way an organization can assure staying out of court. Employers need to maintain sound employment policies that are consistently applied in all employment situations. Additionally, these policies need to be widely communicated to all employees, specifically managers/supervisors who are responsible for administering these policies. Most importantly, should a problem arise, employees need an avenue for voicing concerns and this is best handled by having a sound internal complaint procedure.
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