For wrongful termination cases in California, the statute of limitations is two years for cases involving implied breach of contract or public policy violations, and three years for violations under the Fair Employment and Housing Act (FEHA), the Worker Adjustment and Retraining Notification (WARN) Act, or whistleblower retaliation.
On the federal level, wrongful termination laws may have longer statutes of limitations. However, it is generally required to first file an administrative complaint before initiating a lawsuit. For instance, a claim with the Equal Employment Opportunity Commission (EEOC) must be filed within 180 days from the date of termination to be considered timely.
What is the statute of limitations for wrongful termination in California?
The statute of limitations for wrongful termination in California varies based on the nature of the unlawful discharge:
- Violations of an implied contract for ongoing employment,
- Dismissal against public policy,
- Retaliatory termination under the Fair Employment and Housing Act (FEHA) of California,
- Layoffs breaching the California Worker Adjustment and Retraining Notification (WARN) Act requirements, or
- Retaliation against whistle-blowing as prohibited by state or the federal Sarbanes-Oxley Act.
The timeframe to file a claim for these wrongful termination scenarios ranges from 2 to 4 years.
Breach of implied contract – 2 years
In California, if you’ve been terminated in contravention of an implied contract that mandates termination only for just cause and you lack a written employment contract, you have a 2-year statute of limitations from the termination date to initiate legal action.1 This time limit is pertinent to:
- Breaches of verbal agreements and oral contracts,
- Employment agreements that have not been formalized in writing.
Such legal actions are relatively uncommon since the majority of employees in California are considered at-will and do typically have a formal contract.
Violation of public policy – 2 years
Wrongful termination suits in California based on public policy violations must be filed within a 2-year timeframe from the termination date.2 A termination is against public policy if an employee is discharged for:
- Refusing to commit an illegal act,
- Fulfilling a statutory duty,
- Exercising legal rights or privileges, or
- Reporting a suspected infraction of a significant law.3
In these instances, California law provides a legal claim for wrongful termination, regardless of whether the employment was classified as at-will.
FEHA retaliation – 3 years
Under FEHA, if you are terminated in retaliation for asserting or exercising a protected right, you have a 3-year period from the termination date to file a complaint with the California Civil Rights Department (CRD), formerly known as DFEH.4
After obtaining a right-to-sue notice from the CRD, you are then granted an additional year to bring forth a wrongful termination lawsuit against your employer.5
FEHA-related retaliatory terminations encompass those due to:
- Filing complaints against or opposing workplace or sexual harassment,
- Pursuing claims under employment discrimination law due to:
- Gender,
- Sexual orientation,
- National origin,
- Race,
- Or any other protected characteristic;
- Protesting an employer’s denial of leave under pregnancy, family, or medical leave laws,
- Participating in investigations into alleged discrimination or harassment by the employer,
- Assisting or testifying in a FEHA case, or
- Seeking an accommodation at work for a disability or religious practice.
Violation of WARN Act – 3 years
Wrongful terminations that contravene the provisions of California’s WARN Act are subject to a 3-year statute of limitations.7 Under the WARN Act, employers must provide employees with a minimum of 60 days’ notice in the event of:
- A mass layoff,
- A plant shutdown, or
- A substantial relocation.8
The WARN Act is applicable to employers who have had at least 75 employees over the past 12 months.
Whistleblower retaliation and Sarbanes-Oxley Act – 3 years
In California, whistleblower retaliation cases, typically governed by Section 1102.5 of the California Labor Code, require filing a claim within a 3-year period.10 State laws encompass terminations for:
- Reporting violations of wage and hour laws to the Labor Commissioner,
- Providing evidence of an employer’s alleged criminal conduct to law enforcement or governmental agencies, or
- Internally reporting suspected illegal activities to a supervisor or an authorized investigative party.
Furthermore, the Sarbanes-Oxley Act offers protection for whistleblowers on matters of securities fraud. Should you face wrongful termination under this federal act, you must file an administrative complaint within 180 days.
Should the Department of Labor not resolve the complaint within 180 days, you are then entitled to initiate a lawsuit. Such a lawsuit must be filed within a 4-year timeframe from the termination date.
What is a statute of limitations?
A statute of limitations is a legally defined time limit within which you must initiate legal proceedings. This timeframe starts when you, as the injured party, have either:
- Suffered harm, or
- Become aware of the harm suffered.
Once the statute of limitations expires, your capacity to enforce your rights through the legal system ceases. Attempts to file a lawsuit after this period will likely result in the defendant swiftly moving to dismiss the case.
The purposes of statutes of limitations are to:
- Encourage the prompt pursuit of claims,
- Offer defendants certainty that they will not face old claims indefinitely, and
- Preserve the integrity of evidence and witness testimony by addressing cases while information is still relatively current.
What is wrongful termination?
Wrongful termination occurs when an employment relationship is ended by the employer for reasons that are not lawful.
In California, wrongful termination can commonly arise from:
- Discriminatory practices,
- Retaliatory actions, or
- Breaches of public policy.
Additionally, there is a concept known as constructive discharge, which is a form of wrongful termination. This occurs when an employee is forced to resign due to the employer creating or allowing intolerable work conditions, to the extent that resignation becomes the only reasonable option for the employee.
Why do some laws require an administrative process before I can sue?
Certain employment laws, especially at the federal level, necessitate the filing of an administrative complaint, often with agencies like the Equal Employment Opportunity Commission (EEOC), before a lawsuit can be initiated.
This prerequisite serves to screen the validity of the claim and attempt resolution without court intervention. The administrative route typically involves steps like mediation or arbitration, aiming to lessen the expenses associated with litigation and to conserve judicial system resources.
If the dispute remains unresolved after this administrative process, then pursuing a court case for wrongful termination becomes an option.
The requirement to engage in this administrative step varies with each specific legal situation. Consulting with an attorney can clarify the need for an administrative complaint in your individual case.
What is the average payout for wrongful termination in California?
In California, the settlements for wrongful termination vary widely, with amounts ranging from a few thousand to over a million dollars. There is no typical settlement amount, as the final payout depends on numerous factors including:
- Your salary at the time you were terminated,
- Lost benefits,
- Job title,
- Employment history,
- Specific conditions of the termination such as instances of harassment or discrimination.
The compensation sought in these cases often covers:
- Back pay, which includes wages and any disputed overtime,
- Reinstatement to your previous position,
- Compensation for emotional distress,
- Attorney’s fees.
