FAILURE TO TRAIN RESULTS IN PUNITIVE DAMAGES The Fourth Circuit ruled that punitive damages were appropriate where an employer failed to adopt any anti-discrimination policy or conduct any training on the subject of discrimination. (Anderson v. G.D.C., Inc.) ---------------------------- Pollard v. E.I. du Pont de Nemours & Co., 121 S. Ct. 1946 (2001), held that front pay was not an element of compensatory damages within the meaning of the Civil Rights Act of 1991, and thus was not subject to the Act?s $300,000 statutory cap. The Court overturned the Sixth Circuit?s decision in Hudson v. Reno, 130 F.3d 1193 (1997), which held that front pay was subject to the cap. The Supreme Court reasoned that under §1981a(b)(3), compensatory and punitive damages are capped, but are explicitly provided in addition to the relief available under §706(g) of the Civil Rights Act of 1964. Congress thus never intended to curtail previously available remedies. Id. at 1951. Because front pay was already authorized by the 1964 Act, and functions as a substitute for reinstatement, unlike ?compensatory damages . . . for future pecuniary losses? under §1981, it is not subject to the 1991 limitations. Id. at 1948. The Court drew no distinction between front pay awards made when there eventually is reinstatement and those made when there is not?neither are subject to §1981a(b)(3)?s statutory cap. Id. ----------------------- Pollard v. E.I. du Pont de Nemours & Co., 121 S.Ct. 1946 (Sup. Ct., 2001) Facts Pollard sued her former employer, contending that she had been subjected to a hostile work environment based on her sex. The trial court found that she was subjected to sexual harassment by co-workers, and that her supervisors were aware of the harassment. It resulted in her taking a medical leave of absence for psychological treatment. She was fired for refusing to return to the same hostile work environment. The court awarded her $300,000 in compensatory damages, the maximum permitted under the 1991 amendments to the 1964 Civil Rights Act in most discrimination cases. The court noted that the award was insufficient, but that front pay-money awarded for lost compensation during the period between judgment and reinstatement to employment of in lieu of reinstatement-was subject to the damage cap. The appeals court affirmed the award. Pollard appealed. Decision Reversed. Front pay is not a part of the damages cap within the meaning of the Civil Rights Act of 1991, so damages in this case were not subject to the $300,000 cap. Front pay awards made in lieu of reinstatement to employment are not subject to statutory caps as the courts were instructed to "order such affirmative action as may be appropriate" in such instances. --------------------- Kolstad v. American Dental Assn., 119 S.Ct. 2118 (1999) Description Supreme Court held that an employee need not prove that an employer acted with malice or egregious discrimination to be liable for punitive damages. However, if a manager discriminates despite the employer's good faith efforts to comply with the law, there may be no punitive damages assigned to the employer. Facts Kolstad sued her employer, asserting that the decision to promote a male instead of her was sex discrimination and that the selection process was a sham. The trial court and appeals court held that she could not request punitive damages unless she could demonstrate that the employer had engaged in intentional discrimination and had done so with malice or reckless indifference to her federally protected rights. Kolstad appealed to the Supreme Court. Decision Reversed. Punitive damages may be imposed in a Title VII action without a showing of egregious or outrageous discrimination, independent of the employer's state of mind. To be liable for punitive damages, the employer must at least discriminate in face of a perceived risk that its actions will violate federal law. An employer may not be liable for punitive damages if its managerial agents have made decisions that are contrary to an employer's good faith efforts to comply with Title VII. ---------------------- McCue v. State of Kansas, Dept. of Human Resources, --F.3d-- (1999 WL 5064, 10th Cir.) or 165 F. 3d 784 (10th Cir., 1999) Description In a case of first impression, the Tenth Circuit held that a judgment for sexual harassment and retaliation could stand except for the front pay (future pecuniary loss) the jury awarded. Under Title VII, front pay is an equitable remedy to be determined by the court. Facts McCue filed a sexual harassment complaint against her supervisor. He then gave her a bad evaluation and soon she was dismissed. She filed a suit for harassment, retaliation, and emotional distress. The jury awarded her $300,000, of which $75,000 was for back pay and $175,000 was for front pay. Employer appealed. Decision Reversed as to front pay award. Title VII mentions damages for back pay but does not specify damages for front pay. However, courts may award "equitable relief" as they deem appropriate for Title VII violations. The judge may award front pay for "future pecuniary loss," but it is an equitable relief that should not be submitted to the jury. The trial judge "is best equipped to equitably determine the proper amount for this award." --------------------- Williams v. Pharmacia, Inc., 1998 WL 81258 (7th Cir.) or 137 F. 3d 944 (7th Cir., 1998) Description In case of first impression, appeals court held that employee who suffered sex discrimination could be awarded equitable relief in the form of front pay, plus the statutory maximum damages allowed under Title VII. Facts Williams worked for a company for nine years. She was not interviewed for a promotion for which her supervisor had recommended her, but six men were interviewed. After her request for equal pay for equal work was denied, she complained through the company grievance procedure and was fired. A jury found that her employer had violated the Equal Pay Act and had engaged in sex discrimination by refusing to consider her for promotion, by retaliating against her for filing a grievance, and by terminating her for filing a grievance. She was awarded $300,000 compensatory damages, the maximum allowed under the statute. The court also awarded her equitable relief in the form of back pay of $180,000 and front pay of $115,530, one year's wages and benefits in the position for which she was not considered, in lieu of reinstatement. Employer appealed. Court of Appeals Decision Affirmed. Title VII allows court "to order such affirmative action as may be appropriate, which may include ... reinstatement ... with or without back pay ..., or any other equitable relief as the court deems appropriate." Reinstatement was not practical; "front pay is the functional equivalent of reinstatement because it is a substitute remedy." "The lost future earnings award ... compensates Williams for a lifetime of diminished earnings resulting from the reputational harms she suffered as a result of ... discrimination." --------------------