What is Wrongful Termination?

Posted by Catherine Chukwueke | Jan 04, 2023

California is an “at will” state for employment. This means that the employer and the employee can terminate the employment at any time and without notice. If, however, an employer terminates or fires an employee for unlawful reasons, the employee would have the right to file a wrongful termination claim against the employer. Wrongful termination in California often entitles you to compensation and other remedies.

Rules, regulations, and laws regarding wrongful termination–also referred to as wrongful dismissal or wrongful discharge–differ somewhat from state to state. However, there are some federal laws that regulate wrongful termination aside from state law. 

Regardless of federal or state law, wrongful termination occurs when:

  1. The employer violates its own written or verbal policies or stipulations for termination; or
  2. The employer violates state or federal law via the termination of employment; or
  3. The employer creates a hostile work environment that leads to constructive termination – where the employee finds the working conditions so intolerable that they are forced to resign.

Although California is an “at will” state, an employee can still be wrongfully terminated for either of the two reasons above-mentioned: violation of employer stipulations or violation of the law.

Examples of Wrongful Termination in California

It can be confusing to know if you were wrongfully terminated or not. Simply because it seems unfair does not mean wrongful. That said, wrongful termination can materialize in several different ways. Here are the most common that occur today.

Breach of Contract

Employment agreements are contracts that contain terms, conditions, and consideration (income, paid time off, retirement, health insurance, etc.) the employee will receive in exchange for their work. In other words, the contract spells out what is expected of the employee in return for their wages and other benefits. These contracts do not have to be written to be enforced. When an employee is wrongfully terminated, that termination may be considered a breach of contract. 

Public Policy Violations

Employers are not allowed to terminate an employee when doing so would violate public policy. For example, if an employer directs an employee to perform an act that is illegal, and then fires them for refusing to perform that act, it is a wrongful termination in violation of public policy. Another example could involve an employer barring an employee from joining a union and then firing the person because they joined the union.

Discrimination

When an employee is terminated, or a potential employee is denied a job, due to any of the following reasons, they are the object of employment discrimination. 

  • Age (over 40)
  • Race
  • Ethnicity
  • Skin color
  • Harassment
  • National Origin
  • Pregnancy
  • Disability
  • Sex
  • Sexual Harassment
  • Sexual Orientation
  • Gender Identity
  • Retaliation
  • Religion
  • Genetic Information
  • Compensation/Equal Pay

These various types of discrimination have been established by the United States Equal Employment Opportunity Commission. Employers cannot terminate an employee or pass over an applicant based on any of the above-bulleted characteristics. Further, some states offer additional protections against discrimination, like protection for military personnel.

Whistleblowing

Employees may sometimes engage in behavior that their employer is not happy about. For example, an employee may become aware of illegal activities being conducted by the company and report those illegal activities to the proper authorities. If the employer retaliates against the employee by firing them for reporting the illegal activities, they are guilty of wrongful termination. 

FMLA Violations

The Family and Medical Leave Act (“FMLA”) is a federal act that provides employees with unpaid, job-protected leave for up to twelve weeks per year. The leave is available for employees suffering from a serious health condition or who need to take time off for certain family-related matters, like giving birth, adopting a child, or caring for a family member with a serious health condition. Employers cannot terminate an employee for exercising the rights given to them under the FMLA. If an employer does terminate a person because they took leave under the FMLA, it is a violation of federal law and state law. 

Wage and Hour Disputes

The Fair Labor Standards Act (FLSA) establishes rules for how wages should be paid, including pay for overtime and commissions earned. When an employer terminates an employee for seeking to enforce the rules and regulations set forth by the FLSA, they have engaged in wrongful termination. 

Retaliation

Termination can be one means of retaliation. What happens typically is an employer fires an employee who took leave via FMLA, demanded compliance with the FLSA, complained of sexual or racial harassment or complained of discrimination based on any of the protected characteristics above-listed. Retaliation is unlawful and could be a separate claim against the employer in conjunction with discrimination or harassment.

What Should Employers in California Do to Prevent Wrongful Termination?

Employers should be proactive to prevent their company or business from engaging in wrongful termination. The consequences of a successful wrongful termination claim can be dire for the company. So, by being proactive, a business can prevent future litigation, fines, and penalties. 

  1. Clarity. Employers should always be clear regarding what is expected of an employee. When an employee fails to follow through with clearly laid-out expectations, and the employer keeps track of this failure, it goes a long way to protect the employer from charges of wrongful termination should they terminate the employee. 
  2. Documentation. Documentation is key – employers must be able to show that the employee knew what was expected of them, failed to meet those expectations, was disciplined and warned pursuant to company guidelines, and still failed to meet expectations. 
  3. Training and employee handbook. Training and having a written employee handbook both go a long way to keeping employers and employees on the same page. It is important that employers ensure their training and handbook are compliant with federal, state, and local regulations.
  4. Liability insurance. Liability insurance is also something employers should consider purchasing. Even the most careful employer can find themselves facing a lawsuit for wrongful termination, and liability insurance can assist by defraying the costs associated with defending against the claim.  
  5. Legal counsel. An attorney well-versed in employment law can help employers make sure they have all the required mechanisms in place to prevent wrongful terminations, discrimination, and harassment, among other issues that could put the company at risk of litigation. 

What Should Employees in California Do if Wrongfully Terminated?

Employees who believe they have been wrongfully terminated should take immediate action. Time is of the essence because in these types of cases, you usually have to file an administrative complaint first before a lawsuit, and the former process is very different than the latter process. Plus, the window to file an administrative complaint is a lot smaller than it is to file a lawsuit. Here are a few things you should do if you believe you have been wrongfully discharged from employment in California.

  1. Be cautious. Employees who have been wrongfully terminated should be careful how they conduct themselves. A former employee should follow through with any requests of the employer to return company property or to leave the premises. Do not retaliate in any way by, for example, damaging company property – it will only reflect poorly on you and harm your chances of a fair and just remedy.
  2. Get clarification. Employees should ensure the employer clarifies exactly why they terminated the employee. It is best to obtain this reason in writing, when possible. Your employer will not specifically state an unlawful reason, but it is good to set in stone what the “official” reason is.
  3. Document everything. You should document everything–from the reasons why you believe you were wrongfully terminated to who may have been a witness to any wrongdoing. Try to recall dates, events, names, places, times, etc. If at all possible, preserve any evidence, like emails, text messages, and the like. Even something you think is a minor detail could be significant to your case.
  4. Review everything. If you think you have a case for wrongful termination, you should review your employment contract, if you have one. Also, make sure you have a copy of the employee handbook and any other information related to your employment.
  5. Hire an employment law attorney. Hiring an employment lawyer may actually be the first thing you want to do if you believe you were wrongfully discharged from your job. At the Law Office of Catherine Chukwueke, we can help you take immediate action and preserve as much evidence as we can before it is too late and cannot be recovered. We will help you determine whether you should file a federal or state claim first or do so simultaneously. If you are granted the right to sue, we will begin that process timely and professionally.

Remedies for Wrongful Termination

There are quite a few possible remedies available to a person who has been wrongfully discharged in California. Remedies will be dependent in part on whether you filed a complaint through federal or state agencies or through the court system. Here is an overview of the most common remedies. 

  • Lost wages. From the time you were terminated to the time trial begins, you can seek compensation for lost wages. If you find a job during that time, compensation for lost wages will be reduced accordingly.
  • Lost future earnings. If you cannot find a position or one that pays you comparably, you can seek compensation for this loss of future earnings.
  • Lost benefits. If you lost benefits – like paid time off, bonuses, retirement, and more – it can be compensated through economic damages. 
  • Out-of-pocket expenses. Out-of-pocket expenses include costs associated with things like medical care (e.g., therapy for harassment) or job search (e.g., fees associated with a headhunter).
  • Pain and suffering. This type of compensation is known as non-economic and could include anything from mental anguish to a decrease in quality of life as a negative effect of the termination.
  • Injunctive relief. The court can order the employer to undertake certain acts, like reinstating you as an employee in your former position or requiring policy and procedure changes to prevent wrongful terminations in the future. 
  • Attorneys' fees and costs. You can request reimbursement for attorneys' fees and court costs, and if you win, the court can order the employer to pay these costs.
  • Punitive damages. Punitive damages are designed to punish egregious or malicious behavior and to prevent the same from happening again. Not all states allow it, and most states cap the amount to be awarded. Speak to our employment lawyer at the Law Office of Catherine Chukwueke to know if you might be able to sue for punitive damages under your particular circumstances.

About the Author

Catherine Chukwueke

Catherine (“Cathy”) Chukwueke is the Owner and Principal Trial Attorney of the Law Office of Catherine Chukwueke, a litigation firm focusing on employment and personal injury matters. Ms. Chukwueke is passionate about helping people who have been mistreated in the workplace or who have sustained ...

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