EEOC’s top lawyer slams ‘outdated’ damage caps as judge slashes $36M jury award

The top lawyer for the federal government’s workplace discrimination watchdog slammed statutory damage caps last week after a judge significantly reduced a large jury award from last year.

Omaha-based Werner Enterprises, Inc. and Drivers Management, LLC must pay $335,682 to a deaf truck driver after a jury found the employers had violated the Americans with Disabilities Act by refusing to hire or provide a reasonable accommodation to the driver, the U.S. Equal Employment Opportunity Commission announced Jan. 12.  

The jury verdict, reached Sept. 1 of last year, originally levied $36 million in punitive damages and awarded $75,000 in compensatory damages for the driver. A judge reduced these amounts to $300,000 in punitive damages and $35,682 to the driver for lost wages, plus pre-judgment interest.

Karla Gilbride, general counsel for the EEOC, appeared to bristle at the reduction.

“As the court noted in its order, federal law caps punitive damages at $300,000 — not even one percent of the jury’s intended award,” Gilbride said in the agency’s update. “These caps, which were set by Congress decades ago, take away juries’ power to deter large employers from engaging in intentional discrimination against workers. Juries who have heard the evidence should be able to punish employers who knowingly or recklessly break the nation’s workplace civil rights laws without constraints from outdated caps on damages.”

Along with other employment discrimination laws, the ADA limits compensatory and punitive damages to $50,000 for employers with 15-100 employees, $100,000 for employers with 101-200 employees, $200,000 for employers with 201-500 employees and $300,000 for employers with more than 500 employees. 

For workers, those caps can mean difficulty finding representation due to smaller potential financial incentives, according to a 2020 blog post from plaintiffs’ attorney Tom Spiggle.

Echoing Gilbride, Spiggle also noted the lack of deterrent effects the caps may have on employers. “A $50,000 compensatory and punitive damage award limit for a small business with 15 employees might be adequate motivation to follow the law,” he wrote. “But $300,000 […] to a company with thousands of employees and billions of dollars in revenue will hardly mean anything.”

Different jurisdictions may be more generous toward plaintiffs; Washington, D.C. does not apply any caps for compensatory and punitive damages, for example. And in 2013, Colorado made waves when it expanded state law to allow compensatory and punitive damages targeting employers with fewer than 15 employees. 

One Denver-based management-side attorney advised small businesses in the state to learn more about avoiding discrimination claims, brush up on their policies, train supervisors in compliance and tread carefully when confronted with discrimination claims.