What is a typical employment lawsuit settlement?

Typically, the average employment lawsuit settlement is $40,000, but that doesn’t nearly tell the whole story.  A sexual harassment lawsuit may settle for $120,000, while an unpaid wage lawsuit averages $40,000. Wrongful termination may range from $120,000 to $1 million.

Brad Nakase, Attorney

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The average discrimination settlement amount differs from a wage claim amount. Employment lawsuits and claims are the most significant and most time-consuming losses that a business will face. The average employment lawsuit will cost a company $200,000; this is made up of $80,000 for the employer’s attorneys’ fees, $80,000 for the employee’s attorneys’ fees, and $40,000 in settlement to the employee. The “average” is not a good benchmark because the issues alleged in the lawsuit determine the settlement amount. For example, the average discrimination settlement amount may be $80,000; likewise, an employee’s lawsuit alleging wage violations maybe $10,000.


During the last five years alone, 60% of employers have faced employment lawsuits. Every year the EEOC secures approximately $404 million from U.S employers. So, yes, your company is at risk for lawsuits.

The Cost of Defending an Employee’s Lawsuit

The average cost of out-of-court settlements for employee lawsuits is approximately $40,000. About 10% of discrimination and wrongful termination cases will have a $1 million settlement. The majority of employment cases, when taken to court, are ruled in the employee’s favor.

Litigation costs are getting more expensive. In 2000, the average cost of litigation was $66 million. In 2008 it rose 73% to $115 million. This means that the cost of litigation increases approximately 9% a year.

Types of Employment Lawsuits

It is important to know the most common employment claims so you can protect your company against them.

  • Sexual harassment
  • Wrongful termination
  • Discrimination
  • Retaliation
  • Breach of contract
  • Whistleblower
  • Negligent hiring, supervision, promotion, and retention
  • Disabilities
  • Invasion of privacy
  • Emotional distress and mental anguish

Retaliation has become the top reasons for discrimination lawsuits, higher than even racial discrimination.

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Can my employer call my doctor?

Generally, yes, your employer can call your doctor; however, the questions your employer ask is limited and protected by HIPAA Privacy Law. Your employer has the right to contact your doctor to verify the authenticity of a doctor’s note but cannot ask about your medical condition or diagnosis.

Can I Be Fired for Work Restrictions?

State and federal laws protect employees from employers firing employees because of work restrictions. If you’re fired at work, please get in touch with our employment attorney for a free consultation on work restrictions ignored by the employer.

What Qualifies as an EEOC Complaint?

The EEOC is a federal agency that investigates workplace discrimination and harassment based on race, gender, ethnicity, national origin, age, religion, medical status, and disability. There are time limits for filing a complaint with the EEOC.

EEOC Complaint Process

Before filing an EEOC complaint, employees should understand the entire EEOC complaint process. This article answers many Frequently Asked Questions on the EEOC complaint process.

Do guys get paid paternity leave?

A father is eligible for paternity leave if three conditions are met: 1) welcome a new child within the first twelve months; 2) Paid into the State Disability Insurance; 3) Has not taken more than eight weeks of paternity leave in the past twelve months.

California PTO Payout Law

California law declares vacation time to be earned wages, and vacation time is accumulated as work is performed. So, an employee who has the right to ten days of vacation per year will after six months of work earn five days of vacation time.

Suing For Unpaid Wages California

It is totally unfair for an employee to work and not get paid; employees have bills and rent to pay. Employees suing for unpaid wages in California can get help from an employment attorney.

How Much Does It Cost To Hire a Lawyer To Sue My Employer?

People often ask me how much does an employment lawyer cost? Employees generally have claims against the employer, and an employment lawyer typically works on a contingent fee - meaning there is no fee unless the lawyer wins the employee's case. An employer generally has questions about employment law or a lawsuit; therefore, an employer has to pay a lawyer an hourly fee of $350-$650 per hour, depending on the region.

Is It Legal To Pay Employees Cash Under the Table?

Paying employees in cash is not illegal but frequently employers do not comply with employment laws concerning paying in cash. Employees' lawsuit against the employer for paying in cash has resulted in settlements averaging $100,000.

What is a demand letter?

A demand letter is a letter that is commonly written by a lawyer on behalf of a client setting forth facts supporting a demand for money. A demand letter is usually the first step in resolving a dispute between two opposing parties.

EEOC Discrimination

Learn about the various types of EEOC-prohibited discrimination. The EEOC protects employees from discrimination based on gender, race, ethnicity, gender, religion, national origin, age, disability, etc.

Standard PTO Policy for Small Business

A standard PTO for small businesses depends on the years an employee worked for the company. On average, the standard PTO for one to five years is ten days and six to ten years averages fifteen days.

Retaliation for Reporting Harassment at Work

An employer who punishes an employee who reported sexual harassment in the workplace violates state and federal law and is liable for retaliation. Examples of retaliation include demotion, fewer working hours, segregation, or termination.

Obscene and Sexual Gestures a Work

We're not talking about the ubiquitous middle finger that says fuck you. Obscene and sexual gestures at work may include two fingers in a V shape, with a tongue in between. 

Quid Pro Quo Sexual Harassment

One of the most common types of sexual harassment is Quid pro quo sexual harassment, and it is one of the easiest to hide. All types of workplace sexual harassment are illegal.

Reporting Time Pay

Wages are what we mean when we use the term "reporting time pay." If employers do not pay all of this at the moment of an employee being terminated, there may be waiting time penalties involved.

Can I Sue My Employer For Not Paying Me Correctly?

Employees work hard and deserve to be paid correctly, and on time. It sucks when an employee works hard, and long hours only to be paid incorrectly while the boss is driving a Lambo or Benz.

8 FAQ Answer: Employees Must Know About Wrongful Termination

If an employee believes that he or she has been unlawfully fired from their job, he or she may file a wrongful termination claim in court. These claims are based on the alleged breaking of federal or state anti-discrimination law, employment contracts, or labor laws.

What Are the Signs of a Toxic Coworker?

The 8 identifying traits of of a toxic coworker are: 1. The toxic coworker is often sarcastic. 2. The toxic coworker often insults and mock others. 3. The toxic coworker is selfish...

Two-Week Notice Letter: 9 Tips and 2 Templates

If an employee decides to resign from his or her job, it is normal and expected to provide their employer with two weeks’ notice. Regardless of why a person is leaving their job, it is considered professional to give their employer enough time to make plans to cover the absence.

6 Things to Know About At-Will Employment

“At-will” means that an employer can fire an employee for any reason at any time without getting into legal trouble. The exception is that the reason cannot be illegal in nature.

7 Things Women Should Know About Sexual Harassment

Sexual harassment is an umbrella term covering many forms of unwelcome verbal and physical sexual attention. Sexual assault, meanwhile, is physical sexual contact or behavior that happens without the consent of the victim.

How Long Is Maternity Leave in California?

Under California law, companies with at least five employees must provide new parents with 12 weeks of unpaid maternity leave. Similarly, companies with at least five employees must also grant up to four months of unpaid pregnancy-disability leave to workers who are unable to work due to pregnancy or childbirth.

10 Tips on California Law Expense Reimbursement Time Limit

Under California labor law, employers are required to reimburse employees for business expenses made during the course of their employment, so long as they are necessary and reasonable in nature. This means that an employer must pay an employee back for any financial losses the employee accepted as part of doing his or her job.

What are the 4 Caregiver rights in California?

Employers often face lawsuits from caregivers for violating caregivers’ rights, such as basic wages. A caregiver is an individual who has taken on the role of both care provider and advocate.

How to Find an Employment Lawyer

Often referred to as work lawyers, employment lawyers are attorneys who specialize in employment law and represent workers in all positions across many industries. In California, employment lawyers understand workers’ rights according to the state’s labor laws and can help wronged employees sue and seek damages for improper or unlawful treatment at a workplace.

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