The Supreme Court on 6/4/01 held that an award of "front pay," (i.e., money awarded an employee for lost compensation during the period between judgment and the reinstatement of the employee’s job, or in lieu of such reinstatement) is not an element of compensatory damages under Title VII, and thus not subject to a $300,000 damages cap imposed by 42 U.S.C. § 1981a(b)(3). One important effect of the Court’s holding will be to prevent employees asserting front pay claims from having the right to proceed before a jury. The case is important to employers subject to federal employment discrimination laws.
NAM Comment: Plaintiffs in civil rights cases have an obligation to mitigate damages if they feel they can no longer work for their previous employer because of discrimination. As a result, the size of front-pay damages may not be nearly as great as potential punitive damages against employers that are found liable. Nevertheless, there are some instances where front-pay awards have been sizeable, and now it is clear that plaintiffs may seek both front pay damages without a cap and other compensatory and punitive damages with a cap.