Court reduces award given to bullied employee

The damages comprised $1,000,000 in punitive damages against Wal-Mart; $150,000 in punitive damages against the store manager, for which Wal-Mart was vicariously liable; $200,000 in aggravated damages against Wal-Mart for the manner in which she was dismissed; $100,000 for intentional infliction of mental suffering against the store manager, for which Wal-Mart was vicariously liable; and 20 weeks’ salary.

According to Hicks Morley’s FTR Now update, damages awarded against Wal-Mart were reduced to $100,000 from $1,000,000 and against the store manager to $10,000 from $150,000. The rest of the appeal was dismissed.

“The court’s decision to reduce the punitive damages award against Wal-Mart has restored balance to the quantum of punitive damages awarded in a wrongful dismissal action,” says the update.

The punitive damages awarded by the jury were almost twice as large as the next largest award in a reported employment law case. Punitive damages in the employment law context have rarely exceeded $100,000 and then only in egregious cases involving more serious and longer-term misconduct than that attributed to Wal-Mart.

“By reducing the punitive damages award so significantly in this case, the Court of Appeal has reaffirmed the principles of rationality and proportionality that must underlie a punitive damages award,” according to the update.

“The decision is also notable because it affirms an award for punitive damages against an employer cannot be based solely on an employee’s wrongdoing. The employer itself must have engaged in conduct that is harsh, offensive, high-handed or otherwise warranting punitive damages. Mere negligence by the employer is not sufficient. However, an employer may still be vicariously liable for an award of punitive damages against an employee made based on the employee’s misconduct.”

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