What is a 'Wrongful Termination Claim'

A wrongful termination claim is filed in a court of law by someone who believes they were wrongly or illegally fired from their job. Wrongful termination claims involve an alleged violation of federal or state anti-discrimination laws, oral and written employment agreements, or labor laws, including collective bargaining laws or whistleblower laws. Employees who feel their termination was a form of sexual harassment or is in retaliation for having filed a complaint or claim against the employer may also file a claim.

Breaking Down 'Wrongful Termination Claim'

Employees who have not been fired yet can negotiate for an appropriate severance package. If they have been fired, they could ask for repayment of money damages. When faced with this type of situation, it is recommended that the employee avoid acting on negative instincts toward the employer but instead contact an employees' rights lawyer for advice and representation. It's also essential to first read the employment contract to find out what rights and resources the employee has available.

Wrongful Termination Claim Examples

For cause: While employment in most states is considered "at will," meaning that employers do not need to have a reason to fire them, individuals whose contracts require a cause for their termination but do not receive one may be eligible to file a wrongful termination claim. This means that employees can only be fired "for cause," meaning a cause must be noted, such as willful misconduct, failure to perform job duties, or divulging company secrets. 

Discrimination: Someone fired because of their gender, race or citizenship status may file a wrongful termination claim. Such protections extend to sexual orientation and pregnant women in some states. These laws fall under the Equal Employment Opportunity Commission (EEOC). For more, see Prohibited Employment Policies/Practices and How to File a Charge.

Retaliation: Employers cannot legally punish workers for reporting wrongful activities, such as criminal activity, at work. This is known as whistleblower protection. Also, it is not lawful to terminate a worker simply for filing a workers compensation claim, though any individual asserting that this has happened will have to prove that the measure was retaliatory and not based on work performance or another permitted reason.

Medical History: Under the Genetic Information Nondiscrimination Act (GINA) employers may not use genetic information when making employment decisions. This includes testing for whether a candidate or employee is at greater risk than average of developing certain diseases or inquiring about family medical history.

Organizing: Under the National Labor Relations Act (NRLA) workers are permitted to engage in "concerted activity" to improve wages or working conditions. Workers need not be in a union to be covered by this protection. While an employer may have grounds to fire an individual for complaining or venting about an employer or boss, they are covered if they work together to improve their working environment.

Wrongful Termination Claim: Legal Action 

Workers who believe that they have been dismissed unlawfully should consult with an attorney. There are different deadlines for state and federal laws so time should not be wasted. Workers should also avoid acting negatively against a former employer. Other steps individuals should take include: reviewing their employment contract (and check if conditions and promises were met); obtaining a personnel file and discovering who was responsible for their firing. Such information will be helpful to an attorney reviewing a potential filing.

For advice on how to file, see the EEOC's How to File a Charge of Employment Discrimination informational page.

RELATED TERMS
  1. Termination of Employment

    Termination of employment refers to the end of an employee’s ...
  2. Back Pay

    Back pay is the amount of salary and other benefits that an employee ...
  3. Unemployment Compensation Amendment ...

    Unemployment Compensation Amendment of 1992 allows a terminated ...
  4. Employer's Liability Insurance

    Employer's liability insurance protects employers from financial ...
  5. Constructive Discharge Claim

    A constructive discharge claim is an insurance claim made by ...
  6. Unemployment Claim

    An unemployment claim is a request made by an individual to the ...
Related Articles
  1. Personal Finance

    How to Lay Off Staff

    Firing employees isn't easy, but it is simple: Be honest, be compassionate and be quick.
  2. Managing Wealth

    The Difference Between Being Fired And Resigning

    Here's a rundown of how the two scenarios differ and what you need to know about each.
  3. Personal Finance

    Your Boss Can't Do That! Laws That Protect Workers

    By federal law, American employees enjoy many legal protections that– among other things– provide a minimal level of income and make the workplace safer.
  4. Managing Wealth

    7 considerations when you negotiate severance

    Here are some considerations to take into account when you negotiate a severance, including how to survive and move on from being terminated.
  5. Small Business

    3 Reasons to Develop an Employee Handbook for Your Small Business

    Learn how a small business can benefit from an employee handbook covering labor laws, codes of conduct, leave policies and media relations.
  6. Personal Finance

    America’s Labor Market: Hidden Distortions and Uncertain Forecasts

    Employment reports released by the Bureau of Labor Statistics have a profound impact on political, business, consumer, and investor behavior.
  7. Managing Wealth

    The layoff payoff: A severance package

    If you must leave your job, go out fighting for the best benefits you can get.
  8. Retirement

    Employers: Don't Forget IRS Form 941

    Your obligations as an employer include various employment taxes. Use this form to report them.
  9. Personal Finance

    What's Your Employee Value?

    Have you ever wondered how much you're worth to your boss? Here's a method for calculating that value.
  10. Personal Finance

    Employability, the Labor Force and the Economy

    Learn how employability is affected by market and economic conditions. Find out how soft, hard, and technical skills affects a person's employability.
Hot Definitions
  1. Socially Responsible Investment - SRI

    Socially responsible investing looks for investments that are considered socially conscious because of the nature of the ...
  2. Business Cycle

    The business cycle describes the rise and fall in production output of goods and services in an economy. Business cycles ...
  3. Futures Contract

    An agreement to buy or sell the underlying commodity or asset at a specific price at a future date.
  4. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  5. Portfolio

    A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, also their mutual, exchange-traded ...
  6. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
Trading Center