How Are Wrongful Termination Settlement Values Calculated?

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A man wrongfully terminated and will need legal assistance for the settlement value of the case.If your employer terminated you for unlawful reasons, you have a right to seek remedies. Unfortunately, initiating a legal dispute between you and an employer can be exhausting no matter how strong your case is. The toll litigation can take on an individual leads many wronged employees to ask, “How are wrongful termination settlement values calculated?” There is not a one-size-fits-all answer to this question. Calculating the settlement value of your wrongful termination case depends on your unique circumstances, but we can give you guidelines on how to make a reasonable estimate.

Common Remedies in Wrongful Termination Cases

Wrongful termination settlements are normally based on the amount of money you could expect to be awarded if you took your case to trial and won. Many employers and employees choose to settle wrongful termination cases because litigation is unpredictable and expensive, making settlement a more attractive option. Litigating a wrongful termination complaint to completion could also take a long time, requiring you to relive the events of an unpleasant workplace event for an extended period. Sometimes settling an unpleasant case is not just about getting the compensation you need, but also putting the situation behind you quickly.

To predict the amount of money you could win in a settlement, you should look at the money damages you can win in a wrongful termination case, including:

  • Compensatory damages,
  • Back pay,
  • Attorney fees and costs, and
  • Punitive damages.

The amount of most of these damage categories depends on the dollar value of your job benefits, your employer’s behavior, and the circumstances of your termination.

Compensatory Damages

Compensatory damages in a wrongful termination case include your economic losses and your non-economic losses.

Economic losses

Your economic losses from a wrongful termination are some of the easiest losses to calculate. These losses include anything you have had to pay out of pocket because of your termination, such as job search costs and medical expenses. These losses also include any money you expect to lose in the future because of your termination. Becoming displaced in the labor market causes financial loss, especially if it occurs at a critical point in your career development, and this loss can be recovered as part of your settlement for wrongful termination. Calculating your economic losses is relatively straightforward because it is about collecting relevant receipts, invoices, and financial documents that reflect and forecast your economic losses and future needs due to your termination.

Non-economic losses

Your non-economic losses are more difficult to quantify, but they are important because they can add up and constitute a significant part of a settlement. Economic losses cover your pain, suffering, emotional trauma, and psychological distress. This category of damages could also include harm done to your professional reputation as the result of the wrongful termination. And if mental or emotional issues from wrongful termination give rise to physical ailments, then it’s also possible to recover for costs related to resulting medical care. If you can give accurate and complete details about how your life and your emotional state have changed because of wrongful termination, an experienced wrongful termination attorney can help determine the amount of settlement money you should expect to receive for your pain.

Compensatory damage limits under Maryland law

Under Maryland law, non-economic compensatory damages for wrongful termination are limited. Maryland law places the following caps on non-economic compensatory damages in employment discrimination cases:

  • Employers with 15 to 100 employees in the preceding year don’t have to pay more than $50,000;
  • Employers with 101 to 200 employees in the preceding year don’t have to pay more than $100,000;
  • Employers with 201 to 500 employees in the preceding year don’t have to pay more than $200,000; and
  • Employers with more than 500 employees in the preceding year don’t have to pay more than $300,000.

Knowing these state limits on compensatory damages can help you make smart decisions at the negotiation table.

Back Pay

Awards of back pay cover the wages you lost after your termination. The amount of your back pay includes not only your basic pay rate but also other benefits and compensation associated with your job, such as insurance and bonuses. If you find a job after termination, you need to subtract the wages from that job from your back pay calculation.

Punitive Damages

Depending on where you live, and whether or not you are a public or private employee, you might not have access to punitive damages for wrongful termination under Maryland law, but you could still have access to punitive damages under federal law. If your employer’s actions were particularly reckless or malicious when they fired you, you could have a right to punitive damages.

Initiating Negotiations for Wrongful Termination Settlements

Negotiations to settle your wrongful termination case might not start until after you file a formal complaint. After you file a complaint with the Maryland Commission on Civil Rights or the U.S. Equal Employment Opportunity Commission, there is an investigation period used to review the evidence and possibly come to a resolution. The strength of the evidence you and your employer present could convince your employer to negotiate a good settlement before they spend more money on litigating your complaint. The evidence you present could include:

  • Pay stubs,
  • Work schedules,
  • Benefit statements,
  • Correspondence with human resources,
  • Witness statements,
  • Medical records,
  • Receipts,
  • Financial statements,
  • Correspondence with your supervisor or colleagues, and
  • Personal testimony.

Experienced wrongful termination lawyers know how to locate and gather the strongest evidence in your case to maximize your settlement.

Connect with a Lawyer to Maximize Your Settlement

After suffering an experience as harrowing as wrongful job termination, you probably don’t want to fight a long battle. At Smithey Law Group LLC, we can help you fight this battle. We have award-winning lawyers who are leaders in the employment law community. If you need an Annapolis employment legal matters lawyer, contact us online.

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Joyce Smithey, a seasoned employment and labor law attorney, has over 22 years of experience representing both employers and employees in Maryland and D.C. Her practice, rooted in a deep understanding of employment law, spans administrative hearings to federal litigation. Joyce's approach is comprehensive, focusing on protecting client interests while ensuring legal compliance. A Harvard graduate, her career began in Fortune 500 companies, transitioning to law after a degree from Boston University School of Law. Joyce's expertise is recognized by numerous awards, including Maryland’s Top 100 Women. At Smithey Law Group LLC, which she founded in 2018, Joyce continues to champion employment rights, drawing on her rich background in law and business.

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