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Many of us have received or sent a calculation of front pay for a plaintiff through his or her retirement. The calculation is then used, first in settlement negotiations — “Yes, I know he only has $5,000 in lost wages, but he has potential front pay of $250,000″ — and then at trial, often as the single largest component of damages. So it was with Wendi Sellers’ claim of sex discrimination, harassment and retaliation against the Department of Transportation. Sellers was employed as an air traffic controller in St. Louis from 1987 to 1997. She alleged that she was subjected to a hostile environment in 1996 when a co-worker made advances towards her and, one time, sexually assaulted her in her home. Although the harassing behavior stopped after Sellers complained to her supervisors, the workplace atmosphere deteriorated to the point that she was terminated in 1997. Shortly after leaving her job with the Federal Aviation Association, Sellers started working for Bank of America. She continued working for the bank through April 2000, making over $80,000 per year less than at her air traffic job. Sellers’ case against the DOT was tried in March 2000, while she was still working for the bank. At the end of the trial, the jury returned a verdict in her favor and awarded her $345,000 in back pay and $800,000 in compensatory damages — which was reduced to $300,000. After the trial, Sellers moved the court for equitable relief of either reinstatement or front pay. By this time, Sellers had been fired from her job at the bank for trying to process an unauthorized loan application in the name of her spouse’s ex-wife. She was apparently seeking to obtain the woman’s credit history. TERMINATION FROM BANK JOB A hearing on reinstatement/front pay was held in November 2000 and the court awarded front pay of $638,293.99. The court found, however, that Sellers was terminated from the bank for misconduct and that her post-termination behavior was the basis for the FAA not offering her reinstatement. The DOT appealed on the grounds that the district court abused its discretion in awarding front pay because Sellers’ post-termination misconduct at the bank made her unsuitable for reinstatement. If she could not be reinstated, argued the Department, then she was ineligible for front pay as a matter of law. On appeal, the 8th Circuit relied on the Supreme Court’s after-acquired evidence decision in McKennon v. Nashville Banner Publishing, 513 U.S. 352 (1995) to find that the “factual permutations and the equitable considerations” of the situation should be considered by the court in determining whether, and how much, front pay should be awarded. McKennon held that after-acquired evidence of employee on-the-job misconduct, that would have resulted in the employee’s termination had it been discovered during employment, did not preclude a finding of discrimination, but did affect the damages that could be recovered. In McKennon, the employer learned during discovery that she had copied and removed confidential documents. The court noted that “it would be inequitable and pointless to order the reinstatement of someone the employer would have terminated, and will terminate, in any event on lawful grounds.” AFTER-ACQUIRED EVIDENCE RULE In Sellers, the 8th Circuit extended McKennon to post-termination misconduct. The basis of the decision was the finding that front pay is only to be awarded when reinstatement is impractical. Although, as a practical matter, front pay, rather than reinstatement, is almost uniformly awarded to successful discrimination plaintiffs, the state of the law is that “front pay is a disfavored remedy that may be awarded in lieu of reinstatement.” With that as a premise, where the plaintiff has engaged in post-termination conduct that would prevent reinstatement, “it would be inequitable for a plaintiff to avail herself of the disfavored and exceptional remedy of front pay where her own misconduct precludes her from availing herself of the favored ad more traditional remedy of reinstatement.” The Sellers court used as an example a situation where a plaintiff was convicted of a crime and was unavailable for reinstatement because of a prison term. “Simple common sense” would tell us that front pay in lieu of reinstatement in that case would pervert the equity of the situation. The court, therefore, remanded the case to the district court for a hearing on whether Sellers’ termination from the bank would, in fact, preclude her from reinstatement. This would be the DOT’s burden of proof, based on its actual employment practices, and not just an empty standard. The mere fact that the DOT did not offer reinstatement based on Sellers’ misconduct does not mean that she was ineligible for it. As a practical matter, the Sellers decision will place renewed emphasis on an employee’s post-termination conduct. Defense counsel should explore in depth a plaintiff’s post-termination employment history and may need testimony about an employee’s termination if the records received via subpoena are vague. For an employer to succeed on this defense, the burden of proof will be high, as it will need to show that termination from prior employment disqualifies an applicant from consideration. Sidney R. Steinberg is a shareholder in the business law and litigation department of Post & Schell, (www.postschell.com). He concentrates his national litigation and consulting practice in the field of employment and employee relations law and may be reached at [email protected].

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