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FLSA defense based on failure to mitigate damages

The case of a disgruntled ferry boat operator in another state illustrates a potential defense strategy for employers in New York confronted by accusations of retaliatory discharge. Someone citing the Fair Labor Standards Act when suing a former employer could pursue damages that include back pay, front pay while unemployed, legal costs and reinstatement to a position. To control the potential costs of a settlement, an employer might exploit an angle known as failure to mitigate damages resulting from the termination.

In the lawsuit filed by the ferry boat operator, the man alleged that he was fired after complaining about unpaid overtime. The trial resulted in a jury award that granted him $114,848. The employer sought to reverse the judgment by explaining to the court that the man had failed to mitigate his damages. Evidence revealed that he had turned down two job offers for potentially equivalent positions. In view of these actions, the court lowered the judgment to a token amount of $1 plus $8,961 in legal fees.

When the court explored the possibility that the man might be reinstated to his former job, evidence suggested deep animosity between him and his employer. A supervisor testified adamantly that he would not rehire the person. Although the court recognized the liability of the employer concerning the discharge, the employer successfully limited its costs by exposing the plaintiff’s actions that adversely affected his damages.

A company thinking about terminating an employee’s position might want a legal evaluation prior to taking action. An attorney with wage and hour law experience could examine payroll records and the person’s work duties to see if the employer has any exposure to liability. If a lawsuit has already been filed, an attorney could also prepare a defense strategy that challenges erroneous or excessive claims to compensation.

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