Employment Law Legal Topics

6 Steps to Evaluate a Wrongful Termination Case

A potential client comes to you complaining that he or she was wrongfully fired. Before jumping to grab your retainer agreement, be sure this is a case you really want to take.

There are practical difficulties and demands peculiar to wrongful termination litigation. Use these six steps to evaluate the effort involved and the likelihood of success in any wrongful termination case:

  1. Keep in mind that the law is in flux. Wrongful termination litigation is an ever-changing area of practice. For example, the enforceability of an arbitration agreement can be a major issue in an employment dispute and is an area of much change, as are statutory claims, such as wage and hour claims and claims that unfair employer’s practices constitute an unfair or illegal business practice under the Unfair Competition Law (see Bus & P C §§17200-17210). Although there are opportunities in this state of flux, it also requires updated research and analysis.
  2. Weigh the economic costs against the benefits. In view of the expense, difficulty, and uncertainty in litigating termination claims, carefully consider the economics of litigation by evaluating each available theory of recovery and what is recoverable under each theory.
  3. Consider the credibility of the parties. It is essential that the client be both credible and able to maintain credibility throughout investigation and cross-examination. You also have to be able to obtain and produce evidence showing the employer’s lack of credibility.
  4. Prepare for demanding litigation. Because these cases are often difficult to settle, be prepared for lengthy litigation and the real possibility of a trial that may last for many days or weeks. Make sure to advise the client of  the (1) financial and emotional impact; (2) potential loss of time from other employment; (3) risk of attorney fees; and (4) probing into his or her personal life. It is crucial that you have the client’s pledge of full cooperation, particularly in view of the uncertainties and emotional impact of litigation, and its impact on the client’s private life and subsequent employment.
  5. Explain the duty to mitigate damages. The client must understand the duty to mitigate damages by seeking comparable employment. You’ll need to direct his or her to keep a diary and documents pertaining to this job search.
  6. Research the employer’s financial condition. Check whether the employer is able to cover any judgment, including whether any general liability insurance coverage exists. Insurance coverage is rare, but most likely if the client has a cause of action in, e.g., defamation, invasion of privacy, or negligence.

It’s always better to do a thorough evaluation of a case before taking it than having to get out of a badly chosen one.

For a step-by-step guide through a wrongful termination case, turn to CEB’s Handling a Wrongful Termination Action. For more in-depth coverage of all the issues involved with wrongful termination litigation, check out CEB’s Wrongful Employment Termination Practice: Discrimination, Harassment & Retaliation. On a related issue, check out our blog post, 5 Critical Steps to Take Before Bringing an Employment Case.

© The Regents of the University of California, 2012. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

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