Damages in California Employment Law Cases

The court of appeal in Davis v. Los Angeles Unified School District Personnel Commission explains a number of principles applicable to damages awards in employment law cases. The case involves an employee who successfully claimed he was wrongfully demoted. The appeal concerns the measure of damages. The court held :the plaintiff does not recover back pay during the period when he or she is unable to work due to a non-industrial disability. The court also said that the employee is not entitled to reinstatement until he can perform the functions of the job. The court also explains how back pay is calculated with respect to mitigation. The opinion covers the "mixed motive" defense's effect on damages. This is a key case for settlement discussions, mediations, and if those fail - jury instructions on damages.

DGV

IRS May Tax Emotional Distress Damages

Last year, the D.C. Circuit held that emotional distress damages were not taxable and that to do so was unconstitutional. The case, Murphy v. IRS, arose in the context of an employment law matter. Well, the same panel just reversed itself. The court held that emotional distress damages not arising from physical injury were properly taxed under the Internal Revenue Code. Here is the opinion. Don't read it unless you enjoy the tax code, constitutional law, or want to turn to stone. Just saying.

DGV