News
Labor/Employment
Feb. 14, 2002
Red Line
Employment Law Practitioner Column - By Jeffrey K. Winikow - Representing the rights of low-wage workers can be tremendously rewarding from an emotional standpoint, but the financial rewards are something different altogether. In employment cases, economic damages are largely viewed as the engine driving the train, and attorneys earning their fees on a contingency basis generally look to ride the Orient Express rather than the Red Line.
Employment Law Practitioner Column
By Jeffrey K. Winikow
Representing the rights of low-wage workers can be tremendously rewarding from an emotional standpoint, but the financial rewards are something different altogether. In employment cases, economic damages are largely viewed as the engine driving the train, and attorneys earning their fees on a contingency basis generally look to ride the Orient Express rather than the Red Line.
Unless one wants to be the type of lawyer that will only represent those wealthy enough to pay his or her hourly rate, one must accept that the low end of the wage spectrum in employee-rights advocacy is rarely a profit-maximizing endeavor.
But there are sound, practical ways in which practitioners can efficiently litigate employment cases on behalf of low-wage workers. If an attorney contains costs and properly argues cases, there is no reason why he or she should screen out potential clients, as a matter of course, based on their tax brackets.
• Forgo the economic-damages expert. An economist or other economic-damages expert will have a greater effect on damages calculations with a high wage earner than with a low wage earner because increased dollar amounts magnify slight differences in interest rates and discount values.
Moreover, from a practical standpoint, it is not clear that an economics expert will have any influence on jury behavior, as studies have shown that a typical employment award for economic damages involves something along the lines of three years' pay.
While some cases, like those of older workers experiencing difficulties in the job market, are more suited to longer periods of front pay, the decision on whether to award such damages is left to juror discretion.
An economist is not likely to affect the length of time for which damages are awarded unless one is talking about a specialty job market entailing unusually long periods of unemployment. But in those cases, the individuals are generally well paid.
As a general rule, low-wage workers work in fairly well-established job categories. Jurors will have their own ideas about the duration of time that persons within those job categories should remain unemployed.
One simply does not need to support claims for economic damages through expert testimony. This is true even where the attorney seeks front pay. Indeed, BAJI includes a Present Value Table so, if required to do so, a jury, on its own, can reduce future income to present value.
The Equal Employment Opportunity Commission has rejected the notion that one must retain an expert in order to recover such damages. See EEOC Policy Guidance: A Determination of the Appropriateness of Front Pay as a Remedy under the Age Discrimination in Employment Act of 1967 ("While the plaintiff must present competent evidence demonstrating future damages, the Commission agrees with the decisions holding that expert testimony is not an absolute prerequisite to a determination of the issue of future lost earnings and benefits and their reduction to present value."); see also Cassino v. Reichhold Chems. Inc., 817 F.2d 1338 (9th Cir. 1987).
Even where one seeks front pay, it does not naturally follow that one must discount future wage loss to present value. Under what is known as the "Alaska Rule," as long as a plaintiff bases front-pay damages on his or her final salary, without regard to future increases, calculating front pay may be as rudimentary as multiplying salary by a specified number of years. Jackson v. City of Cookeville, 31 F.3d 1354 (6th Cir. 1994) ("A reasonable approximation [of front pay] can be obtained by simply multiplying [the plaintiff's] present salary by [the specified number of years] and neither including future pay raises nor applying a discount rate"); Stratton v. Department of the Aging, 132 F.3d 869 (2nd Cir. 1997) (discounting to present value not required where court did not factor future salary increases into front-pay award).
This method of calculating economic damages is particularly useful where the worker has either a demonstrated record of consistent wage growth within a job category or where such future wage growth can be presumed through either historical records or collective-bargaining agreements. Low-wage workers, in low-wage occupations, often will be able to make such showings, which makes the Alaska Rule particularly suitable to these cases.
At bottom, attorneys can sacrifice the expense and burden of retaining economic experts in cases involving low-wage workers without sacrificing recovery. While defendants may try and equate the lack of expert testimony with "speculation," experts are required neither legally nor practically. And, as noted in Goss v. Exxon Office System Co., 747 F.2d 885 (3rd Cir. 1984), "the risk of uncertainty with respect to projections of lost income must be borne by the wrongdoer, not the victim."
• Forgo the forensic psychologist. A second area in which the practitioner may be able to reduce out-of-pocket costs is by forgoing the use of a forensic psychologist in a garden-variety wrongful-termination case. While such experts can offer powerful testimony and should be used in cases involving significant psychological trauma, expert testimony does not need to be used in all cases across the board. Hilliard v. A.H. Robins, 143 Cal.App.3d 374 (1983) ("The absence of medical bills or medical testimony will not foreclose a recovery for pain and suffering."); see also Passantino v. Johnson & Johnson Consumer Prods. Inc., 212 F.3d 493 (9th Cir. 2000) (affirming award of $1 million in compensatory damages for retaliation in the absence of expert testimony).
Because low-wage workers will not support large economic-damage awards, there is a tendency among many plaintiff's lawyers to try and hit the proverbial "home run" with a large award for emotional-distress damages. While there is no doubt that an expert's testimony may help prevent a remittitur, the fact remains that this testimony is not necessary in order for one to achieve meaningful relief.
Indeed, in many instances, the most powerful testimony supporting emotional-distress damages comes from a plaintiff's friends and family, who often paint a moving portrait of how the plaintiff's personality has changed as a result of being fired.
Ultimately, the ability to achieve substantial recovery for a low-wage worker's emotional distress lies with the art of advocacy, rather than with the "science" of experts. Many times, it comes down to nothing more than counsel's ability to define what the plaintiff has lost and present that loss to the jury.
Whether it be broken relationships, missed milestones or a decayed self-image, usually the loss of a paycheck is amongst the least of one's losses, yet many practitioners believe that job loss should speak for itself as justifying a large damage award. It rarely does.
• Depose many people for shorter periods of time. Representing low-wage workers compels efficiency. True, defense counsel can virtually shut down one's practice for five to seven days while deposing a plaintiff on such mundane subjects as his or her favorite course in high school, but the plaintiff's attorney must avoid the temptation to reciprocate.
The practitioner should work out a discovery budget and try to depose as many different individuals as possible - even if the depositions are shorter than one ordinarily would like. Indeed, finding and exploiting witness inconsistency is generally an advocate's greatest asset. Taking one or two "key" depositions probably will yield less useful ammunition than deposing eight to 10 different people, so long as one cuts to the chase when questioning witnesses.
Moreover, in a further effort to reduce out-of-pocket expenses, attorneys may want to consider videotaping the depositions themselves, using their own personal camcorder. While Code Civil Procedure Section 2025 requires one to adhere to certain procedures when videotaping depositions, the code does not require that the video operator be neutral (as is the case with a court reporter taking a stenographic record).
• Limiting time and expense does not mean giving a half-hearted effort. Attorneys must recognize that representing low-wage workers will not be as profitable as representing corporate executives. There undoubtedly will be differences in how one handles the two sets of cases. But the use of wage rate as a screening device is all too common. Many attorneys prefer a more suspect case of a high wage earner to a stronger case of a low wage earner simply because of projected fees.
Litigating on behalf of low-wage workers does not have to be a money-losing proposition. If an attorney handles cases properly, the effective hourly rate can be handsome. Indeed, because employers often perceive cases involving low-wage workers to have less exposure, defense counsel will often try their best to strive for efficiency as well. In the end, it generally takes less attorney time to process the case of a low-wage worker to trial than it does when the stakes are higher.
Jeffrey K. Winikow is a Los Angeles employment lawyer.
By Jeffrey K. Winikow
Representing the rights of low-wage workers can be tremendously rewarding from an emotional standpoint, but the financial rewards are something different altogether. In employment cases, economic damages are largely viewed as the engine driving the train, and attorneys earning their fees on a contingency basis generally look to ride the Orient Express rather than the Red Line.
Unless one wants to be the type of lawyer that will only represent those wealthy enough to pay his or her hourly rate, one must accept that the low end of the wage spectrum in employee-rights advocacy is rarely a profit-maximizing endeavor.
But there are sound, practical ways in which practitioners can efficiently litigate employment cases on behalf of low-wage workers. If an attorney contains costs and properly argues cases, there is no reason why he or she should screen out potential clients, as a matter of course, based on their tax brackets.
• Forgo the economic-damages expert. An economist or other economic-damages expert will have a greater effect on damages calculations with a high wage earner than with a low wage earner because increased dollar amounts magnify slight differences in interest rates and discount values.
Moreover, from a practical standpoint, it is not clear that an economics expert will have any influence on jury behavior, as studies have shown that a typical employment award for economic damages involves something along the lines of three years' pay.
While some cases, like those of older workers experiencing difficulties in the job market, are more suited to longer periods of front pay, the decision on whether to award such damages is left to juror discretion.
An economist is not likely to affect the length of time for which damages are awarded unless one is talking about a specialty job market entailing unusually long periods of unemployment. But in those cases, the individuals are generally well paid.
As a general rule, low-wage workers work in fairly well-established job categories. Jurors will have their own ideas about the duration of time that persons within those job categories should remain unemployed.
One simply does not need to support claims for economic damages through expert testimony. This is true even where the attorney seeks front pay. Indeed, BAJI includes a Present Value Table so, if required to do so, a jury, on its own, can reduce future income to present value.
The Equal Employment Opportunity Commission has rejected the notion that one must retain an expert in order to recover such damages. See EEOC Policy Guidance: A Determination of the Appropriateness of Front Pay as a Remedy under the Age Discrimination in Employment Act of 1967 ("While the plaintiff must present competent evidence demonstrating future damages, the Commission agrees with the decisions holding that expert testimony is not an absolute prerequisite to a determination of the issue of future lost earnings and benefits and their reduction to present value."); see also Cassino v. Reichhold Chems. Inc., 817 F.2d 1338 (9th Cir. 1987).
Even where one seeks front pay, it does not naturally follow that one must discount future wage loss to present value. Under what is known as the "Alaska Rule," as long as a plaintiff bases front-pay damages on his or her final salary, without regard to future increases, calculating front pay may be as rudimentary as multiplying salary by a specified number of years. Jackson v. City of Cookeville, 31 F.3d 1354 (6th Cir. 1994) ("A reasonable approximation [of front pay] can be obtained by simply multiplying [the plaintiff's] present salary by [the specified number of years] and neither including future pay raises nor applying a discount rate"); Stratton v. Department of the Aging, 132 F.3d 869 (2nd Cir. 1997) (discounting to present value not required where court did not factor future salary increases into front-pay award).
This method of calculating economic damages is particularly useful where the worker has either a demonstrated record of consistent wage growth within a job category or where such future wage growth can be presumed through either historical records or collective-bargaining agreements. Low-wage workers, in low-wage occupations, often will be able to make such showings, which makes the Alaska Rule particularly suitable to these cases.
At bottom, attorneys can sacrifice the expense and burden of retaining economic experts in cases involving low-wage workers without sacrificing recovery. While defendants may try and equate the lack of expert testimony with "speculation," experts are required neither legally nor practically. And, as noted in Goss v. Exxon Office System Co., 747 F.2d 885 (3rd Cir. 1984), "the risk of uncertainty with respect to projections of lost income must be borne by the wrongdoer, not the victim."
• Forgo the forensic psychologist. A second area in which the practitioner may be able to reduce out-of-pocket costs is by forgoing the use of a forensic psychologist in a garden-variety wrongful-termination case. While such experts can offer powerful testimony and should be used in cases involving significant psychological trauma, expert testimony does not need to be used in all cases across the board. Hilliard v. A.H. Robins, 143 Cal.App.3d 374 (1983) ("The absence of medical bills or medical testimony will not foreclose a recovery for pain and suffering."); see also Passantino v. Johnson & Johnson Consumer Prods. Inc., 212 F.3d 493 (9th Cir. 2000) (affirming award of $1 million in compensatory damages for retaliation in the absence of expert testimony).
Because low-wage workers will not support large economic-damage awards, there is a tendency among many plaintiff's lawyers to try and hit the proverbial "home run" with a large award for emotional-distress damages. While there is no doubt that an expert's testimony may help prevent a remittitur, the fact remains that this testimony is not necessary in order for one to achieve meaningful relief.
Indeed, in many instances, the most powerful testimony supporting emotional-distress damages comes from a plaintiff's friends and family, who often paint a moving portrait of how the plaintiff's personality has changed as a result of being fired.
Ultimately, the ability to achieve substantial recovery for a low-wage worker's emotional distress lies with the art of advocacy, rather than with the "science" of experts. Many times, it comes down to nothing more than counsel's ability to define what the plaintiff has lost and present that loss to the jury.
Whether it be broken relationships, missed milestones or a decayed self-image, usually the loss of a paycheck is amongst the least of one's losses, yet many practitioners believe that job loss should speak for itself as justifying a large damage award. It rarely does.
• Depose many people for shorter periods of time. Representing low-wage workers compels efficiency. True, defense counsel can virtually shut down one's practice for five to seven days while deposing a plaintiff on such mundane subjects as his or her favorite course in high school, but the plaintiff's attorney must avoid the temptation to reciprocate.
The practitioner should work out a discovery budget and try to depose as many different individuals as possible - even if the depositions are shorter than one ordinarily would like. Indeed, finding and exploiting witness inconsistency is generally an advocate's greatest asset. Taking one or two "key" depositions probably will yield less useful ammunition than deposing eight to 10 different people, so long as one cuts to the chase when questioning witnesses.
Moreover, in a further effort to reduce out-of-pocket expenses, attorneys may want to consider videotaping the depositions themselves, using their own personal camcorder. While Code Civil Procedure Section 2025 requires one to adhere to certain procedures when videotaping depositions, the code does not require that the video operator be neutral (as is the case with a court reporter taking a stenographic record).
• Limiting time and expense does not mean giving a half-hearted effort. Attorneys must recognize that representing low-wage workers will not be as profitable as representing corporate executives. There undoubtedly will be differences in how one handles the two sets of cases. But the use of wage rate as a screening device is all too common. Many attorneys prefer a more suspect case of a high wage earner to a stronger case of a low wage earner simply because of projected fees.
Litigating on behalf of low-wage workers does not have to be a money-losing proposition. If an attorney handles cases properly, the effective hourly rate can be handsome. Indeed, because employers often perceive cases involving low-wage workers to have less exposure, defense counsel will often try their best to strive for efficiency as well. In the end, it generally takes less attorney time to process the case of a low-wage worker to trial than it does when the stakes are higher.
Jeffrey K. Winikow is a Los Angeles employment lawyer.
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