The impact of a reinstatement offer

General considerations

In many discrimination/harassment/retaliation cases where the employee plaintiff has lost his or her job, an employer will make an offer of reinstatement in an effort to try to cut off the plaintiff’s economic damages.

In making any decision about how to respond to such an offer, the employee and his or her lawyer will want to keep in mind two things:

  1. Unless the offer of reinstatement is a properly constituted “unconditional offer of reinstatement,” it will not cut off the employee’s economic damages.
  2. The employer does not really want the employee to accept the offer. Rather, the employer is simply using the offer as a strategic litigation maneuver in an effort to try to cut off the accrual of backpay damages and frontpay damages (or reinstatement in lieu thereof).

What is an unconditional offer of reinstatement to employment?

An unconditional offer of reinstatement is an offer by an employer to a former employee that is:

  • to a position and to terms and conditions of employment identical to or substantially equivalent to the plaintiff’s former employment;
  • unconditional; and
  • made in good faith.

When is it reasonable to reject an unconditional offer of reinstatement?

The Courts have generally found that it is reasonable for a plaintiff to reject an offer of reinstatement in several circumstances:

  1. Where the offer was made in bad faith.
  2. Where the plaintiff reasonably fears that he or she will be met with hostility upon returning to the workplace.
  3. Where the plaintiff would suffer severe physical or emotional distress if he or she returned to the workplace.

What are the consequences of reasonably rejecting an unconditional offer of reinstatement?

If a plaintiff reasonably rejects an unconditional offer of reinstatement, there are no negative consequences for the plaintiff as the plaintiff is still entitled to recover all of the damages to which he or she would have otherwise been able to recover absent the offer.

Who must prove whether the rejection of an unconditional offer of reinstatement was reasonable?

The law is clear that the employer bears the burden of proving that an employee failed to mitigate his or her damages.

What are the consequences of unreasonably rejecting an unconditional offer of reinstatement absent special circumstances?

If a plaintiff unreasonably rejects an unconditional offer of reinstatement (absent special circumstances), the plaintiff will not be able to recover economic damages that otherwise would have accrued following the offer.

In addition to forfeiting economic damages that would have otherwise accrued absent the unconditional offer of reinstatement, another consequence of unreasonably rejecting a reasonable unconditional offer of reinstatement (in the absence of special circumstances justifying a rejection of the offer), appears to be that the plaintiff cannot seek reinstatement as a remedy.