What Damages Can You Recover in an Alabama Retaliatory Discharge Case?

What Damages Can You Recover in an Alabama Retaliatory Discharge Case?

If you were illegally fired because you pursued workers’ compensation benefits in Alabama, what can you actually recover in a retaliatory discharge lawsuit?  The answer is important because an Alabama retaliatory discharge claim is separate from the underlying workers’ compensation claim.

Workers’ compensation benefits are generally intended to compensate an injured employee for the consequences of the work-related injury. A retaliatory discharge lawsuit addresses a different wrong: the employer’s unlawful termination of the employee for pursuing rights under Alabama’s Workers’ Compensation Act.

Because retaliatory discharge is a tort claim, the damages can be substantially different from the benefits available in the workers’ compensation case.  Depending upon the evidence, recoverable damages may include lost wages and other economic losses, damages for mental anguish, and punitive damages.

Can I Recover Lost Wages After a Retaliatory Discharge?

Yes. Lost earnings can be an important part of the damages in an Alabama retaliatory discharge case.  Consider an employee earning $1,000 per week who is unlawfully fired and remains unemployed for six months despite making reasonable efforts to find another job. The wages lost during that period may constitute part of the employee’s damages.

The calculation can become more complicated if the employee later finds another job.

If the new job pays less, there may be an ongoing wage loss. If it pays more, it might initially appear that there can be no future economic loss, but even that is not necessarily the end of the analysis.

Merchants FoodService v. Rice: Earning More Money Did Not Automatically Eliminate Future Lost Earnings

The Alabama Supreme Court’s decision in Merchants FoodService v. Rice, 286 So. 3d 681 (Ala. 2019), is particularly helpful.

Rice was a delivery driver who prevailed on his retaliatory discharge claim. After being fired, he eventually obtained another driving job.  His new employment actually produced more annual income than his former employment.  The employer therefore argued that Rice could not recover future lost earnings.

But there was more to the story.

Rice testified that he had averaged approximately 32 hours per week with his former employer. At his new job, he was working approximately 18 additional hours per week. He therefore had to work substantially more hours to produce his new income.  The Alabama Supreme Court rejected the argument that comparing annual income alone necessarily resolved the issue. The Court recognized that determining future lost earnings can be fact-specific and that, depending upon the circumstances, the employee’s effective hourly earnings can also be relevant.

The practical lesson is important: A paycheck does not always tell the entire story.

When evaluating economic loss following a retaliatory discharge, it may be necessary to examine wages, hours worked, benefits, earning rate, and the employee’s overall employment circumstances—not simply compare two annual W-2 totals.

What If My Work Injury Prevents Me From Working?

This is where the damages analysis becomes particularly important.  In Bleier v. Wellington Sears Co., 757 So. 2d 1163 (Ala. 2000), the Alabama Supreme Court held that being “willing and able” to return to work is not an element the employee must prove as part of the initial retaliatory discharge case-but ability to work can still matter greatly when damages are calculated.

An employee generally cannot claim wages he or she could not have earned because the work injury itself prevented the employee from working.

For example, if an employee is completely unable to work for six months because of the compensable injury, the employee cannot simply characterize those six months of wages as being lost because of the retaliatory discharge, but that does not necessarily mean the retaliatory discharge claim disappears.

Other damages may still be available if supported by the evidence.

Recommended Reading: Do I Have to Be Able to Return to Work to Bring an Alabama Retaliatory Discharge Claim? explains the important distinction between the ability to establish a retaliatory discharge claim and the ability to recover lost wages.

What If I Am Permanently and Totally Disabled?

This presents another issue we have discussed earlier in this series.

A finding of permanent total disability under Alabama workers’ compensation law does not necessarily mean that the injured worker is physically incapable of performing any work whatsoever.  Workers’ compensation and retaliatory discharge also answer different legal questions.

Accordingly, the existence of a permanent-total-disability finding should not automatically be treated as ending the retaliatory discharge analysis; however, the employee’s actual ability to earn wages remains highly relevant when determining economic damages.

Recommended Reading: Can You Be Permanently and Totally Disabled and Still Win an Alabama Retaliatory Discharge Case? discusses why permanent total disability and retaliatory discharge are not necessarily inconsistent.

Can I Recover Damages for Mental Anguish?

Yes.

Being wrongfully deprived of your livelihood can cause consequences that cannot be measured solely by looking at a paycheck.  An employee may experience anxiety, humiliation, sleeplessness, embarrassment, loss of confidence, strain on family relationships, or fear about being able to support a family, and Alabama law permits recovery for mental anguish in an appropriate retaliatory discharge case.

Again, Merchants FoodService v. Rice provides a useful example.  Rice testified about the personal consequences of his termination, including shock, sleeplessness, anxiety, embarrassment, irritability, and changes in his relationships and sense of himself.  Importantly, Rice had not undergone counseling or taken medication for the emotional distress associated with the termination.

The Alabama Supreme Court nevertheless concluded that his own testimony provided direct evidence of the nature, extent, and duration of his mental anguish and upheld the compensatory award against the challenges properly before it.

The lesson is not that every employee who is fired automatically receives a large mental-anguish award.; rather: The employee’s own detailed testimony about how the termination actually affected his or her life can be important evidence of damages.

Do I Need to See a Psychiatrist or Counselor to Recover Mental-Anguish Damages?

Not necessarily.

Medical or counseling evidence may certainly strengthen a claim when it exists, but Rice demonstrates that treatment is not an absolute prerequisite to presenting evidence of mental anguish.  What matters is the quality of the evidence.

There is an important difference between simply testifying: “Being fired upset me” and explaining specifically:

• how long the emotional distress lasted;
• whether the employee lost sleep;
• whether the employee experienced anxiety or embarrassment;
• whether relationships were affected;
• whether financial uncertainty created significant stress; and
• how the termination affected the employee’s daily life.

The more specific and credible the evidence, the better a jury can evaluate the actual harm caused by the termination.

Can Punitive Damages Be Recovered for Retaliatory Discharge?

Yes, when the required proof exists.  Punitive damages are different from compensatory damages.

Compensatory damages are intended to compensate the employee for the losses caused by the wrongful conduct.

Punitive damages are intended to punish sufficiently wrongful conduct and deter similar conduct in the future.

Under Alabama law, punitive damages require a heightened level of proof. The employee must present clear and convincing evidence of the type of conduct specified by Alabama’s punitive-damages statute.

Retaliatory discharge cases are particularly significant in this context because firing an employee for exercising workers’ compensation rights can affect more than the employee who was terminated.  Other employees may see what happened and become afraid to report injuries or pursue benefits to which they are legally entitled.

Why Did the Alabama Supreme Court Say Punitive Damages Are Particularly Important in Retaliatory Discharge Cases?

In AutoZone, Inc. v. Leonard, 812 So. 2d 1179 (Ala. 2001), an Alabama jury returned a retaliatory discharge verdict consisting of $200,000 in compensatory damages and $750,000 in punitive damages.  The trial court subsequently reduced the awards to $75,000 in compensatory damages and $275,000 in punitive damages, and the Alabama Supreme Court affirmed the judgment as remitted.

In discussing punitive damages, the Court recognized their particular importance in retaliatory discharge cases because of both the seriousness of wrongfully depriving an employee of a livelihood and the potential chilling effect retaliatory terminations can have upon other employees who might otherwise exercise their workers’ compensation rights.

That is an important point.

Alabama’s retaliatory discharge law does not merely protect one employee’s paycheck. It helps protect the workers’ compensation system itself by discouraging employers from punishing workers for exercising rights the Legislature gave them.

How Large Can an Alabama Retaliatory Discharge Verdict Be?

There is no useful “average” that tells an injured employee what his or her case is worth.

The facts vary enormously, but Alabama appellate decisions demonstrate that substantial verdicts are possible when the evidence supports them.

In Merchants FoodService v. Rice, the jury awarded:

• $314,862.88 in compensatory damages; and
• $944,588.64 in punitive damages.

The total verdict was $1,259,451.52.

The Alabama Supreme Court affirmed the judgment.

That does not mean another retaliatory discharge case is worth $1.2 million. It means that Alabama law permits substantial compensatory and punitive damages when the particular evidence justifies them.

Likewise, our firm has firsthand experience trying substantial retaliatory discharge cases. Powell and Denny obtained a $750,000 jury verdict for an injured Alabama worker in a retaliatory discharge case in Bessemer, Alabama.  The verdict was upheld by the Supreme Court of Alabama.

That result does not establish the value of another client’s claim. Every case must be evaluated upon its own liability evidence, economic losses, mental anguish, employer conduct, and available defenses-but it does illustrate something important: An Alabama retaliatory discharge claim can be a substantial civil case—not simply an extension of the employee’s workers’ compensation benefits.

Are Punitive Damages Automatically Awarded If I Prove Retaliatory Discharge?

No.

Proving retaliatory discharge does not automatically establish an entitlement to punitive damages.  In AutoZone, the Alabama Supreme Court explained that punitive damages required clear and convincing evidence that the employer consciously or deliberately engaged in the type of oppressive, fraudulent, wanton, or malicious conduct required by Alabama law.

Evidence that an employer engaged in a broader pattern or practice of retaliating against injured workers can be particularly persuasive, but the Supreme Court has also made clear that proving such a pattern or practice is not an absolute requirement for punitive damages in every retaliatory discharge case as the particular conduct directed toward the individual employee may itself provide sufficient evidence, depending upon the circumstances.

Are Retaliatory Discharge Damages Subject to Review or Limits?

Yes.

A large jury verdict does not necessarily mean the employee ultimately receives the precise amount initially awarded.  Punitive damages are subject to statutory and constitutional requirements and judicial review. Alabama courts consider factors including the reprehensibility of the defendant’s conduct and the relationship between punitive and compensatory damages.

AutoZone itself demonstrates this process.

The jury originally awarded $950,000. The trial court ordered a substantial remittitur, reducing the judgment to $350,000, and the Alabama Supreme Court affirmed the reduced award.

By contrast, in Merchants FoodService v. Rice, the Alabama Supreme Court concluded that no further reduction of the $944,588.64 punitive-damages award was warranted.

For that reason, it would be misleading to tell an injured worker that there is a single formula that determines the maximum value of every retaliatory discharge case.  The applicable limitations and the judicial review of punitive damages must be considered in light of the particular verdict and facts.

Workers’ Compensation Damages and Retaliatory Discharge Damages Are Different

This distinction is worth repeating.

Suppose an employee tears a rotator cuff at work and is later unlawfully fired for pursuing workers’ compensation benefits.  The workers’ compensation case may involve matters such as:

• authorized medical treatment;
• temporary disability benefits;
• permanent disability;
• vocational disability; and
• future medical benefits.

The retaliatory discharge case concerns damages resulting from the wrongful termination itself.

The two claims can arise from the same sequence of events, but they compensate for different legal injuries.  This is why an injured employee should not assume that resolving the workers’ compensation case necessarily resolves the retaliatory discharge claim.

What Evidence Can Help Establish Damages?

A strong damages case should be documented just as carefully as liability.  Potential evidence may include:

• pay stubs and W-2s before termination;
• earnings records from subsequent employment;
• evidence of lost insurance or other employment benefits;
• job-search records;
• unemployment records;
• evidence concerning hours worked before and after termination;
• testimony from the employee and family members concerning emotional effects;
• counseling or medical records, when applicable;
• evidence concerning financial difficulties caused by the termination; and
• evidence concerning the employer’s conduct that may support punitive damages.

An employee should not wait until shortly before trial to begin thinking about damages.

The Bottom Line

An Alabama retaliatory discharge case can involve considerably more than the wages an employee lost immediately after being fired.  Depending upon the evidence, recoverable damages may include past and future economic losses, mental anguish damages, and punitive damages.

But each category requires proof.

An employee’s medical inability to work may affect lost-wage damages. Subsequent employment may affect—but does not necessarily eliminate—future economic damages. Mental anguish should be supported with specific evidence, and punitive damages require a heightened showing concerning the employer’s conduct.

Cases such as AutoZone v. Leonard and Merchants FoodService v. Rice demonstrate both the potential significance of retaliatory discharge damages and the careful scrutiny those damages receive from Alabama courts.

Recommended Reading: Do I Have to Be Able to Return to Work to Bring an Alabama Retaliatory Discharge Claim? discusses how an injured worker’s ability to work can affect the claim and lost-wage damages.

Recommended Reading: What Is Pretext in an Alabama Retaliatory Discharge Case? explains how an employee may prove that the reason offered by an employer for the termination was not the real reason.

If you suffered an Alabama job injury and were subsequently fired because you pursued workers’ compensation benefits, don’t assume that your damages are limited to your workers’ compensation benefits or a few weeks of lost wages.

If you have questions about an Alabama retaliatory discharge claim, don’t hesitate to contact and speak with one of the experienced Alabama Workers Compensation and Social Security Disability attorneys at Powell and Denny today for a free consultation. Appointments are available in person, or virtually via Zoom if more convenient.  Powell and Denny would appreciate the opportunity to help.  And remember, there is no fee unless you win.

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