Thomas M. Durkin, United States District Judge.
Linda Ortega was a tenured teacher in the Chicago Public School ("CPS") system. She taught fifth grade at Hedges Elementary until the principal of that school terminated her after determining she no longer met the requirements for her position. Ortega brought this lawsuit alleging intentional discrimination by the principal and her employer, the Chicago Board of Education ("the Board"), in violation of the Americans With Disabilities Act ("ADA"), 42 U.S.C. §§ 12111-117. Summary judgment was entered in favor of the principal because the ADA provides a right of action against the employer but not the employee's supervisor. Ortega's discrimination claims against the Board went to trial on October 13-16, and 19, 2015, and the jury returned a verdict in Ortega's favor, awarding her $285,000 in compensatory damages.
Following the jury's verdict, the parties appeared before the Court on numerous occasions to address disputes over the equitable relief, if any, to which Ortega might be entitled as a result of the jury's finding of intentional discrimination. On August 15, 2016, the Court held a hearing to allow the introduction of additional evidence on the equitable relief question. After careful consideration of the evidence introduced at the equitable relief hearing, as well as the evidence submitted at trial and the legal briefs filed thereafter, the Court now concludes that Ortega is entitled to equitable relief in the form of back pay, prejudgment interest, front pay, and lost pension benefits, as more fully set forth below.
The ADA incorporates the remedies available to a plaintiff in a Title VII discrimination action. See 42 U.S.C. § 12117(a); 42 U.S.C. § 1981a(a)(2). Those remedies include compensatory damages "for future pecuniary losses, emotional pain, suffering, inconvenience, mental anguish, loss of enjoyment of life, and other nonpecuniary losses." 42 U.S.C. § 1981a(b)(3). For employers such as the Board (more than 500 employees), compensatory damages are capped at $300,000, although the jury is not informed of this cap. See 42 U.S.C. § 1981a(b)(3)(D), § 1981a(c)(2). The jury's $285,000 compensatory award is within the statutory cap, and is not before the Court in this opinion. Instead, the issue to be decided is whether Ortega is entitled to one or more of the remedies specifically excluded from the jury's compensatory award, namely, "back pay, interest on back pay, or any other type of relief authorized under ... [42 U.S.C. § 2000e-5(g)]." 42 U.S.C. § 1981a(b)(2).
Back pay and other forms of equitable relief are available in an ADA case, see 42 U.S.C. § 1981a(a)(2); 42 U.S.C § 2000e-5(g)(1), but the decision of whether to award them is reserved for the trial court. See Pals v. Schepel Buick & GMC Truck, Inc., 220 F.3d 495, 500 (7th Cir. 2000). When making that decision, the trial court "must respect the findings implied by the jury's verdict," id., but is otherwise vested "with broad discretion to fashion a remedy for unlawful discrimination," E.E.O.C. v. Ilona of Hungary, Inc., 108 F.3d 1569,
"Complete relief for a victim of discrimination generally will include an award of back pay; indeed, such an award is presumptively proper once a violation has been shown." Ilona of Hungary, Inc., 108 F.3d at 1580 (citing Equal Emp't Opportunity Comm'n v. O & G Spring and Wire Forms Specialty Co., 38 F.3d 872, 880 (7th Cir. 1994), and United States v. City of Chicago, 853 F.2d 572, 575 (7th Cir. 1988)). Back pay represents the wages the plaintiff would have earned had she not been fired. See 7th Cir. Pattern Civil Jury Instruction 3.11 (2015). Included in this calculation are any "benefits [s]he would have received from the Defendant if [s]he had not been [terminated]." Id.
Ortega seeks an award of net lost wages through August 15, 2016
The Board argues, on the other hand, that Ortega's entitlement to back pay should be limited in two respects: first, by her failure to mitigate her damages; and, second, by a stipulation to a back pay amount to which the parties agreed during the trial. The Board has been inconsistent about whether it is seeking to impose both of these limitations at the same time, and its most current position on that question remains unclear. In addition, the Board takes issue with Ortega's calculation of net lost wages, and further argues that Ortega should not recover any prejudgment interest because of her purported delay in this litigation. Taking these arguments into account, the Board provides the Court with three back pay options. First, the Board suggests that Ortega is entitled to net lost wages only through June 19, 2012 (the date on which she allegedly stopped mitigating her damages) in the amount of $33,335, to which the Board would add $2,333.45 in lost pension contributions, for a total back pay award of $35,668.45. R. 179 at 7. In what the Court will assume is an alternative calculation, the Board argues Ortega is entitled to the stipulated amount of $215,835 in back pay, although the Board is unclear whether it believes the stipulated amount is subject to further deductions.
The Court will begin by reviewing the evidence regarding Ortega's job history. The Court then will address the Board's affirmative defense of failure to mitigate, followed by the Board's argument that the parties' trial stipulation serves to limit the amount of Ortega's back pay award. Next, the Court will resolve disputed issues related to the net lost wages calculation and prejudgment interest on net lost wages.
Ortega began her employment with the Board on January 26, 1998. R. 139 at 79 (Tr. Transcript 143); R. 184 at 40-41; Def. Ex. X.
On June 19, 2010, Ortega moved from the reassigned teacher's pool to the substitute teacher's cadre. The substitute teacher's cadre is the second-year benefit given to a tenured teacher who has not found another teaching position after spending one year in the reassigned teacher's pool. The pay of a cadre substitute teacher is substantially less than the pay of a reassigned teacher. If a teacher's time in the cadre is up and she still has not been appointed to a permanent position, her employment with the Board is terminated. R. 141 at 127-29 (Tr. Transcript 191-93). Ortega supplemented her income as a cadre substitute teacher with a job as a part-time professor at City Colleges of Chicago. Id. at 167-68 (Tr. Transcript 231-32). Her employment with the Board ended altogether sometime in 2011. See R. 184 at 165.
For more than a year after her final separation from the Board, the only income Ortega received was her part-time City Colleges salary and unemployment compensation. R. 139 at 173-74 (Tr. Transcript 237-38). In May 2013, she was offered and accepted a job as a human services caseworker with the State of Illinois. Initially, she received a trainee salary of $38,000 per year, which then increased to $48,000 per year. Id. at 174-75 (Tr. Transcript 238-39); R. 184 at 165.
The following is a summary of Ortega's job history:
Date Employer Income January 26, 1998-June 19, 2009 Board full-time assigned teacher June 19, 2009-June 19, 2010 Board reassigned teacher's pool (full salary) June 19, 2010-October 2011 Board and City Colleges substitute teacher's cadre and part-time of Chicago professor October 2011-May 2013 City Colleges of Chicago part-time professor and unemployment benefits May 2013-present State of Illinois human services caseworker, trainee followed by full-salary employee
"Liability for back pay begins at
An employer may avoid the accrual of back pay by showing that the plaintiff failed to mitigate her damages. See Graefenhain v. Pabst Brewing Co., 870 F.2d 1198, 1202 (7th Cir. 1989) ("[A] discharged employee must mitigate damages by using `reasonable diligence in finding other suitable employment.'") (quoting Ford Motor Co., 458 U.S. at 231, 102 S.Ct. 3057 (emphasis supplied by court omitted)); see also Doe v. Oberweis Dairy, 456 F.3d 704, 714 (7th Cir. 2006) (quoting 42 U.S.C. § 2000e-5(g)(1) ("interim earnings or amounts earnable with reasonable diligence by the person or persons discriminated against shall operate to reduce the back pay otherwise allowable") (emphasis added)). The burden of proving lack of mitigation is on the employer. Ilona of Hungary, Inc., 108 F.3d at 1581. The Seventh Circuit has "emphasize[d]" that, to prevail on a failure to mitigate defense, the employer must prove "`both that the [plaintiff was] not reasonably diligent in seeking other employment, and that with the exercise of reasonable diligence there was a reasonable chance that [she] might have found comparable employment.'" U.S. Equal Emp't Opportunity Comm'n v. Gurnee Inn Corp., 914 F.2d 815, 818 (7th Cir. 1990) (citations omitted) (emphasis supplied by court).
Ortega kept detailed records to document her job applications in the first three years following termination of her tenured position at Hedges Elementary. See R. 139 at 166-67 (Tr. Transcript 230-31). She testified that in the first school year after she was reassigned (2009-2010), she applied for 127 teaching positions. Id. at 166 (Tr. Transcript 230). The next school year (2010-2011), she applied for about 326 teaching positions. Id. In the third school year following her reassignment (2011-2012), she applied for 487 teaching positions. Id. Ortega testified that after June 2012 she "decided not to continue investing [her] time and energy [in applying for teaching jobs with the Board]" because "it became apparent to [her] that [she] was not going to obtain [such] a job." Id.
The Board argues it has met its burden of proof on its failure to mitigate defense after June 2012
That is exactly what Ortega did here. She testified that she submitted hundreds of job applications each year, and she never testified that she stopped aggressively looking for a job. Nor did she ever admit that she made no applications whatsoever after a certain point. In testimony not tied to any definite time period, she stated that she "applied for at least a thousand jobs," which included "not just ... high-income [jobs]," like her old teaching position, but non-teaching jobs as well, including "everything that [she] thought [she] might be eligible for." R. 139 at 167 (Tr. Transcript 231). Nevertheless, after three years of searching for a comparable teaching job, she decided to focus her search on any employment for which she was qualified.
The Board cites Williams v. Imperial Eastman Acquisition Corp., 994 F.Supp. 926 (N.D. Ill. 1998), for the proposition that, when Ortega accepted the lower paying job with the state government, she made a willful choice to be under-employed. But Williams "does not teach that starting an alternative career in lieu of continuing to seek comparable employment necessarily constitutes a failure to mitigate damages." Snow v. HealthSouth Corp., 2001 WL 395124, at *27 (S.D. Ind. Mar. 21, 2001). Rather, the plaintiff in Williams sought permanent work in a different field after making only "two inquiries [for comparable work]." 994 F.Supp. at 932. The Williams court viewed this minimal effort as evidence that the plaintiff's "decision to give up on the search and return to his hometown to run the family cattle farm entailed a personal choice to start an alternative career, rather than a serious attempt to mitigate damages." Snow, 2001 WL 395124, at *27. Significantly, the Williams court specifically noted that the plaintiff "could have decided to work permanently on the cattle farm if after a diligent search, he could not find comparable work." Williams, 994 F.Supp. at 932 (emphasis added). Here, Ortega submitted not two, like in Williams, but over nine hundred applications seeking comparable employment with the Board.
The Supreme Court has recognized that "[t]he extended time it frequently takes to obtain satisfaction in the courts may force a discrimination claimant to suffer through years of underemployment or unemployment before being awarded the job claimant deserves.... The claimant cannot afford to stand aside while the wheels of justice grind slowly toward the ultimate resolution of the lawsuit. The claimant needs work that will feed a family and restore self-respect. A job is needed — now." Ford Motor Co., 458 U.S. at 221, 102 S.Ct. 3057. The Board argues Ford Motor Co. is inapposite because it involved an employer charged with discrimination in hiring who attempted to toll the accrual of back pay liability by making a pretrial offer to hire the plaintiff for the job that was previously denied to her. Id. at 220, 102 S.Ct. 3057. But the Board does not explain why that factual distinction makes any difference here. As the Board itself recognizes (see R. 179 at 5), the Supreme Court made the statement about needing a job "now" in the context of interpreting and applying the mitigation rule. The only difference is that, in Ford Motor Co., the employer argued that back pay did not accrue after it offered the plaintiff a job, whereas here the Board argues that back pay does not accrue after Ortega stopped applying for teaching positions with the Board. The observation about needing a
Implicit in the holdings of the cases approving of a plaintiff lowering her job expectations after a lengthy search for comparable work is the conclusion that, once a lower paying job is accepted, the plaintiff may recover back pay damages without being required to make further mitigation efforts. As one court stated, "a plaintiff must continue his efforts at mitigating his post-verdict but pre-reinstatement losses. Where, however, the plaintiff is genuinely unable to find work or is forced to `lower his sights' and accept an inferior position, the defendant will be responsible for the difference (however great) between what the employee would have been earning and what he actually earned during the period prior to his reinstatement." Coleman, 949 F.Supp. at 610 (emphasis added). In any event, Ortega testified that she has never stopped and continues through the present looking for better paying jobs than the job she currently has with the state government. R. 184 at 72-73. The Board's argument that "there is no evidence" that Ortega has been diligently searching for a comparable job, R. 185 at 2, is an attempt to shift the burden of proof to Ortega. The question is not whether Ortega has produced evidence she was diligent but whether the Board has produced evidence she was not.
Even if the Court were to conclude that Ortega's efforts to mitigate her damages were less than diligent, the Board still has not met its burden of proof on the second issue of whether it was reasonably likely that Ortega would have obtained another teaching job had she continued looking after June 2012. See, e.g., Gracia, 130 F.Supp.3d at 1257 (discussing types of evidence that might satisfy a defendant's burden of proof on the issue); Coffey, 145 F.Supp.3d at 779 (same).
R. 166 at 8 (¶ 12). While Ortega's post-trial testimony regarding the reasons the two potential job offers never came to fruition arguably is speculative, just as speculative is the conclusion the Board asks the Court to draw from Ortega's experience with the two potential jobs — that it was reasonably likely she would have gotten another teaching position had she kept looking.
The Board also cites to the fact that another tenured teacher testified at trial that she got a teaching position at Hedges Elementary shortly after being placed in the reassigned teacher's pool. But the teacher's testimony does not cover the circumstances under which she obtained her job at Hedges, which, in any event was in the fall of 2010, while Ortega was still looking for comparable teaching positions with the Board. Without information about whether her situation was similar to Ortega's, the Court is unable to draw a non-speculative inference that the ability of the teacher in question to get a job in the fall of 2010 has any bearing on whether Ortega would have been able to do so after June 2012.
Finally, the Board introduced additional evidence at the equitable relief hearing through the testimony of Kathryn Gray, the current manager of the reassigned teacher's pool. The Board argues that "Ms. Gray testified that 58% of the teachers in the reassigned teacher's pool found full-time teaching positions at the Board despite the fact that they were typically limited to five months in the pool." R. 179 at 6. Ms. Gray testified that she was not the manager of the pool during the relevant time period, R. 184 at 214, and it is by no means clear that current statistics have any meaning for the earlier time period when Ortega was a member of the pool. Ortega testified that "[w]hen [she] was a reassigned teacher [in the] 2009 through 2010 academic year, it was a well known fact that reassigned teachers are blacklisted and most are not rehired as full-time tenured teachers." R. 161 at 5 (¶ 7).
While Ortega's testimony regarding the chances of a reassigned teacher finding a permanent position may be speculative, it would appear that Gray's testimony, though couched in statistics, is just as speculative. As far as the Court can tell, Gray's 58% estimate is not grounded in any objective data. And Gray could not provide a breakdown in terms of how many teachers who got hired from the reassigned teacher's pool were, like Ortega, over the age of 40 and tenured more than ten years, characteristics which Ortega argues would make her chances of finding a permanent position lower than average. See R. 184 at 230. Moreover, even if Gray's testimony regarding the percentage of teachers who find a job during their five
In sum, the Court finds that neither Gray's testimony nor any other evidence cited by the Board satisfies the Board's burden of proof on the issue of whether Ortega would have found another teaching position had she continued looking past June 2012. See Pierce v. Atchison, Topeka & Santa Fe Ry. Co., 65 F.3d 562, 575 (7th Cir. 1995) ("Pierce actively pursued comparable employment but had been unable to find anything other than minimum wage (or lower) jobs during the three and one-half years since his discharge. We cannot conclude that the court acted unreasonably in assuming that Pierce would not find a similar job in the future.").
The Board's second argument for limiting Ortega's back pay award requires some background information regarding how the trial stipulation came about. Prior to trial, the parties agreed to an advisory jury verdict on the back pay issue. See Seventh Circuit Pattern Civil Jury Instruction 3.11, Committee Comment a ("The court may empanel the jury as an advisory jury on the [back pay] issue; or the parties may, with the court's consent, agree that the jury will decide the issue."). During trial, however, it became apparent that neither side was fully prepared to present evidence to the jury on the back pay issue.
As a result of the parties' agreement, the Court gave the following jury instruction:
R. 141 at 139-40 (Tr. Transcript 707-08).No instruction was requested by the Board or given to the jury for the Board's failure to mitigate defense, notwithstanding that, prior to entering into the stipulation, the Board had anticipated presenting that issue to the jury as indicated by its pre-trial proposed jury instructions. The Board now argues that Ortega's back pay award should be limited to no more than the $215,835 stipulated amount.
The Seventh Circuit has said that "[s]tipulations regarding the nature of trial proceedings are crucial to the prompt and efficient disposition of litigation. Therefore, once made, a stipulation is binding unless relief from the stipulation is necessary to prevent a `manifest injustice' or the stipulation was entered into through inadvertence or based on an erroneous view of the facts or law." Graefenhain, 870 F.2d at 1206. "As with other matters of trial management, the district court has broad discretion to decide whether to hold a party to its stipulations," and its "decision will be
The Court's review of the record indicates a number of factors relevant to its exercise of discretion here. First, the circumstances surrounding the stipulation suggest there was no meeting of the minds regarding what the stipulated amount was meant to represent. While both parties argue what they "understood" the stipulation to cover,
Second, the Board cannot argue it will be prejudiced if the Court does not hold Ortega to the stipulation. Ortega "is not materially changing her positions or arguments in any way, such as if she was now seeking to recover a type of damages that she never requested or was seeking to proceed on entirely new theories." Hathaway, 2006 WL 1594060, at *4.
Third, it would be unfair to hold Ortega to the stipulated amount when the confusion surrounding the stipulation came about as a result of the Board's desire, for strategic reasons and despite its lack of preparation, to submit the back pay issue to the jury for "advisory" purposes. At the very least, if the stipulation in fact was an accommodation to both parties and Ortega did intend to agree to a final number, there is a strong case to be made that the stipulated amount was intended to reflect net back wages and to take into account the Board's failure to mitigate defense.
Fourth, it was explicitly recognized by the parties that several back pay issues, such as pension amounts, recovery for health benefits, and whether the Board was entitled to off-set the amount of the back pay award with unemployment compensation, would be dealt with after trial. Ortega's counsel also explicitly preserved the issue of whether Ortega was entitled to additional amounts in back pay for the period after the jury reached a verdict through the date on which judgment was entered. While it is true that, other than these items, Ortega's counsel did not expressly reserve adjustments to the stipulated back pay amount, the opposite also is true; that is, nowhere in the record does it clearly show that the parties intended by entering into the trial stipulation to preclude other matters from being raised post-trial for purposes of the Court's final determination on the back pay issue. Further, the Court repeatedly warned the parties that the jury's verdict regarding back pay was for advisory purposes only, and that the Court would retain final decision-making authority on the issue. See, e.g., R. 127 at 50-54; R 141 at 194. Although the Court's comments were made in the context of discussions regarding pension benefits, it would not have been unreasonable for Ortega's counsel to have taken the Court's statements to mean that additional evidence would be allowed after the jury verdict to enable the Court to reach a final conclusion regarding the entire back pay amount.
For all of the above reasons, the Court concludes that the stipulation is not binding, and the Court will decide the back pay issue independent of the trial stipulation based on the evidence introduced at trial and at the post-trial equitable relief hearing.
The Court now turns to the net lost wages calculation, which includes two components: (1) the total amount of wages Ortega would have received from the Board if she had not been displaced from her position at Hedges Elementary; and (2) Ortega's actual earnings from other employment during the same time period. See Horn v. Duke Homes, Div. of Windsor Mobile Homes, Inc., 755 F.2d 599, 606 (7th Cir. 1985) ("damages are determined by measuring the difference between actual earnings for the period and those which [the plaintiff] would have earned absent the discrimination by defendant") (internal quotation marks and citation omitted).
Ortega retained an actuary to determine the amount of her lost earnings. To calculate what Ortega's salary would have been had she not been terminated, the actuary began with the undisputed fact that, during Ortega's final year of full tenured employment, she received an annual salary of $81,646.07. See R. 184 at 166; Pl. Exs. 7, 13. The actuary then relied on the salary schedules attached to the Chicago Teacher's Union Collective Bargaining Agreements ("CBAs") to determine what Ortega's salary would have been for each of the applicable school years for which she was
Another way in which the actuary's calculations might have been slightly off were that they may have failed to account for the fact that an employee moves up a step on the anniversary date of his or her employment with the Board rather than at the start of the next school year. Ortega's anniversary date was January 26. R. 184 at 41. Therefore, Ortega would have begun a school year in September at her previous step and moved up to the next step about mid-way through the school year. The actuary's projected salary figures for each school year relied on the annual salary amounts shown in the CBA for each new step, when, according to the Court's interpretation of Via's testimony, Ortega's actual salary for a given school year would have been a blend of the salary shown on the CBA schedule applicable to that school year for her old, carry-over step (September through January) and the salary for her new, or next step up (February through June).
Ortega argues that, after adjustments are made to her actuary's calculations to reflect what she believed the evidence at the hearing showed regarding step increases, her salary in the years following her termination would have been as follows:
School year Salary 2010-2011 $85,994 2011-2012 $90,473 2012-2013 $89,836 2013-2014 $91,853 2014-2015 $93,665 2015-2016 $95,538
The total lost earnings through August 2016 sought by Ortega is $547,359. R. 178 at 6. While these numbers partially address the mistakes in some of the actuary's assumptions, they still appear to be somewhat inaccurate. Ortega appears to assume she would have moved to a step 15 after spending only one year at step 14 when Via testified there was a four year wait before moving from step 14 to 15. And while Ortega's counsel suggested at the hearing that she took into account the mid-year change for when the move up in step occurs, she did not introduce evidence to prove that assertion. Finally, Ortega's newest calculations do not appear to take into account the 2 percent mandatory employee contribution to the pension fund, which her actuary deducted from the annual salary figures.
The Board argues that Ortega's lost earnings had she not been terminated amount to only $524,062. See R. 179 at 7. The Board's salary projections are shown on Exhibit Z, which was a document generated by the Board for purposes of the equitable relief hearing and introduced during Via's testimony. Via testified, however, that he was not involved in the preparation of Exhibit Z, and he was never asked whether he could attest to the accuracy of the calculations reflected in it. R. 184 at 52. Although Ortega did not object either to the admission of that document for lack of foundation, or to Via's testimony concerning the information contained in that document for lack of personal knowledge, the Court takes Via's admission of lack of personal knowledge into account in deciding what weight to give that document. The Board's salary calculations on Exhibit Z show only a biweekly pay figure, not an annual pay amount, and do not indicate the lane or step from which that biweekly pay figure is derived. Further, Via testified he did not know what lane or step was being applied. Therefore, it is difficult for the Court to make any kind of assessment as to the degree to which Exhibit Z accurately reflects what Ortega's salary would have been.
"In determining the proper award of back pay, a court must make sure that any award is not speculative and does not put the plaintiff in a better position than she was before her termination." Hathaway, 2006 WL 1594060, at *2 (citing Ilona of Hungary, Inc., 108 F.3d at 1580 (quoting United States v. City of Chicago, 853 F.2d 572, 575 (7th Cir. 1988) for the idea that "[t]he court must `do its best to recreate the conditions and relationships that would have existed if the unlawful discrimination had not occurred'")). When confronted with "uncertainty which clouds the task" of computing a back pay award, however, the Seventh Circuit has "set down three general rules: (1) unrealistic exactitude is not required; (2) ambiguities in what an employee ... would have earned but for discrimination should be resolved against the discriminating employer; [and]
The Board argues the Court should disregard the calculations of Ortega's actuary because of the "numerous inaccuracies" the Board claims its cross-examination revealed. But the discrepancies resulting from predictions and/or presumptions made by the actuary did not call into question the basic accuracy of his calculations; they only suggested that his calculations were slightly off (the difference between the Board's calculation of loss wages and Ortega's revised calculation is around 4.5 percent). And, as previously noted, exactness is not required.
School Step Salary 2% Pension Total Salary
Year Contribution
2010-2011 1st half 13 $84,912 × ½ = $849 $41,607
$42,456
2d half 14 $85,994 × ½ = $860 $42,137
$42,997
2011-2012 14 $89,433 $1,789 $87,644
2012-2013 14 $88,815 $1,776 $87,039
2013-2014 1st half 14 $89,611 × ½ = $896 $43,909
$44,805
2d half 14b $90,591 × ½ = $906 $44,390
$45,296
2014-2015 1st half 14c $92,403 × ½ = $924 $45,278
$46,202
2d half 15a $93,665 × ½ = $937 $45,896
$46,833
The step freeze went into effect in June 2015, when the 2012-2015 CBA expired. But in the 2015-2016 school year, Ortega would have remained at Step 15a in any event. After expiration of the 2012-2015 CBA, the Board and the Chicago Teachers Union failed to reach agreement on a new CBA, so there are no new salary schedules to apply to the 2015-2016 school year (and later). The actuary testified that he assumed that had there been new salary schedules, they would have provided for at
2010-2011 $83,744 2011-2012 $87,644 2012-2013 $87,039 2013-2014 $88,299 2014-2015 $91,174 2015-2016 $93,627
The actuary obtained Ortega's actual earnings information from her tax returns, and then made adjustments to reflect that the relevant earnings figures are for school years rather than tax returns. See Exhibit 13. The Board also uses Ortega's tax returns to determine her actual earnings. See R. 179 at 7 (citing to Plaintiff's Exhibit 8). But the Board did not make any adjustments to account for the fact that Ortega's actual earnings, like her lost earnings had she remained in her job with the Board, must be calculated on a school year basis. Therefore, the Court will use the more accurate actual earnings figures calculated by the actuary.
Putting together the above information, Ortega's net lost wages for each school year through August 15, 2016 are as follows:
PROJECTED EARNINGS ACTUAL EARNINGS NET LOST WAGES 2010-2011 $83,744 $29,147 $54,597 2011-2012 $87,644 $15,828 $71,816 2012-2013 $87,039 $21,314 $65,725 2013-2014 $88,299 $40,408 $47,891 2014-2015 $91,174 $49,873 $41,301 2015-2016 $93,627 $52,169 $41,458
Ortega's total net lost wages from June 2010 through August 2016 amounts to $322,788.
Prejudgment interest is presumptively available on a back pay award. See Shott v. Rush-Presbyterian-St. Luke's Med. Ctr., 338 F.3d 736, 745 (7th Cir. 2003) ("in most cases prejudgment interest is an element of full compensation"); Gorenstein Enter., Inc. v. Quality Care-U.S.A., Inc., 874 F.2d 431, 436 (7th Cir. 1989) ("The time has come, we think, to generalize, and to announce a rule that prejudgment interest should be presumptively available to victims of federal law violations. Without it, compensation of the plaintiff is incomplete and the defendant has an incentive to delay.").
The Board argues that the Court should deny Ortega an award of prejudgment interest because of her "delays in filing, serving and prosecuting this case." R. 179 at 8-9. Ortega was required to bring her civil action against the Board within 90 days of receiving a right to sue notice from the Equal Employment Opportunity Commission ("EEOC"). 29 C.F.R. § 1601.28(e)(1). There is no contention that Ortega's filing of this lawsuit was untimely under this provision.
The Court does not agree that Ortega should be denied prejudgment interest based on the fact that she could have filed this lawsuit and served the Board earlier than she did. The definition of "delay" is "the act of postponing, hindering, or causing something to occur more slowly than normal." https://www.merriam-webster.com/dictionary/delay. The Board does not contend that Ortega filed her lawsuit or served the Board outside the time periods permitted by the applicable rules. Congress already has set forth what it believes is a reasonable time for filing suit and serving a complaint, and Ortega did those things within those deadlines. By definition, therefore, she did not do anything slower "than normal." To impose some other, shorter timeline would be arbitrary and create unnecessary uncertainty, as well as penalize employment discrimination plaintiffs for exercising procedural rights to which they are entitled under the discrimination statutes and federal rules of civil procedure.
In addition, the Board fails to take into account substantial delay during the administrative process (prior to Ortega's filing of an EEOC complaint) for which Ortega claims the Board was responsible. See R. 166 at 2 ("Upon participating in the arbitration process, Board lawyer Edward J. Wong III ... delayed about six months in submitting the Board's response."). It would not be fair to impose a penalty on Ortega for delay in the EEOC proceeding without taking into account delay caused by the Board in investigating and administratively resolving Ortega's complaints prior to her filing of the EEOC complaint, and the slippery slope of such a comparative analysis were the Court to embark on that path is obvious.
The Board also claims Ortega should be penalized for the delay caused by her missing certain court deadlines during this litigation, which purportedly prevented the Court from ruling on the Board's dispositive motions and Ortega's demand for equitable relief in a timely manner. R. 179 at 8. The Court again rejects the Board's delay argument. While Ortega missed one or two deadlines following the jury's verdict, she did so by only a week or less. There has been no showing by the Board that those missed deadlines actually caused delay in the timing of any court ruling or the overall progression of the case, and the Court is skeptical that they did.
In addition, as is often the case, both parties have been responsible for some delay. See Coleman, 949 F.Supp. at 614 (finding that both sides have "failed to exercise sound judgment and due diligence"). For instance, on at least one occasion following the jury verdict, a four to five week delay was occasioned by a combination
Ortega's argument regarding difficulties she has had with the Board during these post-trial proceedings brings up another point. Most if not all of the information necessary to determine the back pay amount was within the Board's control. Had Ortega simply presented her best estimates, the Court might have concluded that was sufficient and resolved the back pay issues sooner.
In sum, despite whatever role Ortega may have played in any delay that has occurred in this case before or after trial, the Court finds that delay should not count against her in regard to her entitlement to prejudgment interest according to the law. See Hunter, 797 F.2d at 1426-27 ("Since Allis-Chalmers' misconduct in firing Hunter was deliberate, equitable considerations even if admissible to contest prejudgment interest do not weigh heavily in its favor.").
Both parties agree that the proper prejudgment interest rate is 3.25 percent. R. 179 at 8-9; R. 180 at 3 n. 2; R. 184 at 104, 106; see Arroyo v. Volvo Grp. N. Am., LLC, 2017 WL 2985649, at *10 (N.D. Ill. July 13, 2017) (awarding prejudgment interest at a rate of 3.25 percent (compounded monthly)); Gracia, 130 F.Supp.3d at 1263 (using 3.25 percent (compounded monthly) because "that was the prime rate for almost the whole prejudgment period in this case, except for a few weeks when it was 3.61 percent"); Sheils v. GateHouse Media, Inc., 2015 WL 6501203, at *10
Neither party addresses the method for calculating prejudgment interest. The actuary obviously applied some method for his interest calculation but it was not explained either in his report or during his testimony at the hearing. And the Court cannot adopt Ortega's method for calculating prejudgment interest in her post-equitable relief hearing brief, which relies to some extent on the concededly inaccurate figures presented by her actuary, because the Court does not fully understand it.
2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 Principal $54,597 $71,816 $65,725 $47,891 $41,301 $41,458 (Net Lost Wages) Interest June 1, June 1, June 1, June 1, June 1, June 1, Period 2011 2012 2013 2014 2015 2016 through through through through through through November November November November November November 30, 2017 30, 2017 30, 2017 30, 2017 30, 2017 30, 2017 Accrued 77 65 53 41 29 17 Months Rate 3.25% 3.25% 3.25% 3.25% 3.25% 3.25% (compounde d monthly) Interest $12,641 $13,803 $10,130 $5,616 $3,370 $1,951
The total amount of prejudgment interest is $47,511.
The Board has conceded that, absent the Court ruling in its favor on its failure to mitigate defense, Ortega is entitled to back pay through the date judgment is entered in the case. See R. 139 at 261 (Tr. Transcript 325); see also R. 127 at 52. The parties have provided calculations of back pay through the August 15, 2016 equitable relief hearing. In McKnight v. General Motors Corp., 973 F.2d 1366, 1369 (7th Cir. 1992) (McKnight II), the Seventh Circuit held that it would be an abuse of discretion not to let the plaintiff submit evidence of lost wages post-trial through date of judgment.
Academic Year Annual Salary Employee Net Salary Pension [annual salary Contribution less pension (2%) contribution] August 2016-June 2017 $97,449 $1,949 $95,500 [$95,538 + 2%] August 2017-June 2018 $99,398 $1,988 $97,410 [$97,449 + 2%]
Thus, Ortega's projected earnings are $95,500 for the 2016-2017 school year, and $38,964 ($97,410 × 4/10
In addition to back pay, Ortega seeks an award of front pay. "[F]ront pay is the functional equivalent of reinstatement because it is a substitute remedy that affords the plaintiff the same benefit (or as close an approximation as possible) as the plaintiff would have received had she been reinstated." Williams v. Pharmacia, Inc., 137 F.3d 944, 952 (7th Cir. 1998). "Generally, front pay is awarded as a substitute remedy when reinstatement is inappropriate, such as when `there [is] no position available or the employer-employee relationship [is] pervaded by hostility.'" Id. (quoting McNeil v. Economics Lab., Inc., 800 F.2d 111, 118 (7th Cir. 1986)); see McKnight v. Gen. Motors Corp., 908 F.2d 104, 116 (7th Cir. 1990) ("McNight I") (if "reinstatement is withheld because of friction that would ensue independently of any hostility or retaliation by the employer, a remedy limited to back pay will not make the plaintiff whole"; in such cases, front pay fills the "remedial gap"). "As an equitable remedy, the district court has discretion to decide whether to award front pay." Graefenhain, 870 F.2d at 1201.
The Board argues the Court should deny Ortega's request for front pay because the Board has offered to reinstate her. But Ortega has rejected the Board's offer. The question, therefore, is whether the Board's rejected offer of reinstatement cuts off Ortega's right to recover front pay. The same issue was addressed by the Supreme Court in Ford Motor Co. — only in the context of a claim for back pay. The defendant in Ford Motor sought to cut off the accrual of damages while litigation over the plaintiffs' discrimination in hiring claim was pending by offering the plaintiffs the job that previously was denied to them. The Supreme Court noted that a discrimination plaintiff has a duty to mitigate his damages by using "reasonable diligence in finding other suitable employment." 458 U.S. at 231, 102 S.Ct. 3057. A plaintiff's refusal of a job "substantially equivalent to the one he was denied" constitutes a failure to mitigate. Id. Therefore, the Supreme Court held, an employment discrimination plaintiff must accept "an unconditional offer of the job originally sought" or forfeit his right to back pay in the period following the defendant's offer. Id. at 231-32, 102 S.Ct. 3057.
The Board is correct (R. 179 at 2-3 n.1) that this case does not raise any issue related to the "unconditional" part of the offer of employment discussed in Ford
870 F.2d at 1203 (citations omitted) (emphasis added by court).
Thus, under the two-step approach out-lined in Graefenhain, the initial question is whether the Board's offer of reinstatement is for a job that is comparable to Ortega's prior job. The Board bears the burden of proof on that issue. Id. If the Board's reinstatement offer is not for a comparable job, the Court need not evaluate Ortega's reasons for rejecting it. If the offer is for a comparable job, the Court then goes on to examine Ortega's reasons for refusing the offer. Only if the offer is inadequate because it is not for a comparable job, or, the offer is adequate but Ortega's reasons for rejecting it are valid, does the Court move on to the task of calculating an award of front pay in lieu of reinstatement.
The Board did not offer to reinstate Ortega to her former teaching position at Hedges Elementary. Instead, the Board offered to return Ortega to the reassigned teacher's pool for four years or until such time as she received an offer for a permanent teaching job. During her period of employment as a reassigned teacher, Ortega would receive the same salary and benefits to which she would have been entitled as a permanent assigned teacher at Hedges. And, while teachers in the reassigned teacher's pool typically switch schools every few weeks to allow them to maximize their contacts within the Board to assist in the search for a permanent assignment,
Whether an offer of reinstatement is adequate to trigger the Ford Motor rule requiring the plaintiff to accept it or forego recovery of further damages "is largely a fact question, which requires weighing the employee's prior experience and job skills against the terms and conditions of the offer. Since predominantly factual, the trial court's determination as to the adequacy of a reinstatement offer will be upset on appeal only if clearly erroneous." Graefenhain, 870 F.2d at 1203. The adequacy of the offer is measured broadly by the standard applicable to an employment discrimination plaintiff's duty to mitigate. Id. at 1202. A plaintiff's duty to mitigate is discharged "by using `reasonable diligence in finding other suitable employment.'" Id. (quoting Ford Motor, 458 U.S. at 231, 102 S.Ct. 3057) (emphasis added by court).
Graefenhain, 870 F.2d at 1202. In short, "[a]n offer of reinstatement tolls the accrual of damages only if it `afford[s] the claimant virtually identical promotional opportunities, compensation, job responsibilities, working conditions, and status.'" Id. at 1203 (emphasis added) (citation omitted).
As an initial matter, the Board's equivocation on whether it has offered to reinstate Ortega at all is enough to give the Court serious pause over whether it needs to even address front pay versus reinstatement, notwithstanding that the Board argues at length on the issue. The Board has stated that Ortega's "contention that the Board has `offer[ed] to reinstate [her] as a reassigned teacher ... for four years," is incorrect and that, in fact, "[t]he Board has repeatedly denied four years is an inappropriate period for equitable relief in this case and has not `offered' to reinstate Plaintiff. Rather, pursuant to the Court's request, the Board has described for Plaintiff what reinstatement will entail if the Court orders it." R. 162 at 4 (emphasis added).
If Ortega does not request reinstatement (which she does not), and the Board has not offered reinstatement (which the Board contends it has not), then the Court is left wondering why the parties are even talking about anything other than the question of the sufficiency of the evidence on Ortega's front pay request. The Board's "offer" apparently is to comply with a court order of reinstatement, but the Board says it can comply only with a court order of reinstatement for a period of four years. And a four-year reinstatement is not a comparable job with "virtually identical" characteristics to Ortega's previous job at Hedges. The Board contends four years in the teacher's pool is an appropriate offer because Ortega requested front pay for only a four year period. But reinstatement
Even apart from the time limit, the Court rejects the Board's contention that its offer of reinstatement
Ortega also points out that a reassigned teacher does not have control over either the subject she is teaching or her schedule. A regularly appointed teacher's schedule includes preparation periods, but a reassigned teacher usually has to forfeit those preparation periods to substitute in other classes. R. 161 at 6 (¶ 9). A reassigned teacher does not have her own classroom, and instead fills in wherever there is a need, even when assigned to one specific school. Often this means teaching a class she might not be qualified to teach, such as math or science, or even a class like physical education that Ortega could not teach because of her disability. It could even mean she is assigned to do nothing more than clerical work. Id. at 5-6 (¶ 8).
Even when assigned to a specific classroom, Ortega argues the job differs significantly from the job of a regularly assigned teacher:
Id. at 6 (¶ 9). Ortega also argues that teachers in the pool experience a "lower standard of treatment" because they are not the regularly assigned teacher. According to Ortega, a student who behaves poorly to a substitute suffers little by way of consequences. Id. at 7 (¶ 10). She tells of one instance when she was a reassigned teacher at a high school for three weeks and a student threatened to shoot her on two different occasions if she did not give him an A,
All of these conditions of employment lead to lack of job satisfaction, according to Ortega. "There is not an opportunity for an academic relationship to develop. The on-going rotation of classes and schedules makes it impossible to adequately use pedagogies and methods that propel individual[] growth." Id. Ortega also mentions miscellaneous matters related to job conditions, such as her belief, based on personal experience, that the union representative is not as accessible to reassigned teachers as he or she is to a tenured assigned teacher, even though reassigned teachers also pay union dues. Id.
Ortega's testimony is based on her own personal experience when she was in the reassigned teacher's pool from 2009 to 2010. The Board did not offer any evidence to contradict her testimony on the above points. The Court therefore has no basis to question the veracity or accuracy of Ortega's testimony, which the Court found logical and credible. Accordingly, the Court concludes consistent with Ortega's testimony that the Board's offer of reinstatement does not provide Ortega with the same conditions of employment she had when she was an assigned, tenured teacher at Hedges.
Opportunities for Advancement. Ortega argues that, even if she is paid the same as a tenured teacher and even if the Board allows her to opt out of the normal rotation involved in the reassigned teacher's pool, "[t]he perpetually changing schedule of a reassigned teacher does not allow for the same professional growth that assigned tenured teachers experience." Id. at 7 (¶ 11). "When [she] was [a] reassigned teacher, [she] was not allowed to participate in professional development and especially, outside of the school conferences, trainings or seminars," because she "was not deemed eligible or worthy to be exposed to new pedagogies, methods, textbooks, or authors." Id. According to Ortega,
Id. at 8-9 (¶ 13).
The Board did not offer any evidence to counter this testimony. Therefore, the Court finds that the opportunities for advancement of a reassigned teacher are not the same as a full-time assigned teacher with tenure.
Status. According to Ortega, a reassigned teacher is a substitute teacher by another name. And the difference in prestige between a tenured teacher and a substitute teacher is readily apparent. Among those differences to which Ortega testified is the attitude of colleagues (id. at 7 (¶ 11) ("colleagues ... perceive a reassigned teacher as ... not qualified for the job")), and the attitude of students and parents (id. at 6 (¶ 8) ("Students would ask `why don't you become a teacher?'"). Ortega claims that "parents and Board employees made the assumption that something was wrong with [her]" because she was in the reassigned teacher's pool. She was embarrassed by this attitude. Id. ("There I was[,] a substitute with a Bachelor of Science from Northwestern University and a Master in Education from Loyola University with 60 graduate hours, while parents and other CPS teachers also wondered why I was not a tenured assigned teacher.... To be a tenured assigned teacher and be degraded to reassigned/substitute status was grotesquely humiliating.").
While it could be concluded that Ortega was hypersensitive to what she may only expect but does not know others are thinking, she does cite to a few specific instances in which her abilities apparently were questioned as a result of her status. In addition, the Court has no doubt based on the evidence at trial and the post-trial hearing that the status of a reassigned teacher who functions as a substitute is less than the status of a permanently assigned teacher. Again, the Board has not offered any contrary evidence.
Despite the Board's contention that its offer of reinstatement terminated its front pay liability, the Court must conclude that the Board's offer guarantees Ortega a comparable position in terms of salary and benefits only for a limited period of four years. The Board's offer to be reinstated into the reassigned teacher's pool is not an offer of a "substantially equivalent job," within the meaning of Ford Motor Co. See Pierce, 65 F.3d at 575 (district court did not "abuse[] its discretion by finding that [the plaintiff] did not have to accept an embarrassing and less fulfilling position with the same company that discriminated against him").
Given the Court's finding that the Board's offer of reinstatement was inadequate, it is unnecessary for the Court to decide whether Ortega's reasons for rejecting
The Board's argument derives from the frequently made observation that reinstatement is the "preferred" remedy in unlawful employment termination cases. See, e.g., Hicks v. Forest Pres. Dist. of Cook Cnty., Ill., 677 F.3d 781, 792 (7th Cir. 2012). But that statement is most often made in cases where the employee is the one requesting reinstatement and the employer opposes it. In Price v. Marshall Erdman & Associates, Inc., 966 F.2d 320 (7th Cir. 1992), the Seventh Circuit corrected the district court for implying that "it makes no difference whether the employee dislikes the idea of working for the employer, or the employer dislikes the idea of having the employee work for him." Id. at 325.
Id.
The Board mostly cites to cases involving the "problematic" employer-opposed situation.
The Board argues in favor of its offer of reinstatement by focusing almost exclusively on the fact that the principal who terminated Ortega would not be her supervisor under the Board's reinstatement offer.
While the Court does not credit Ortega's testimony that the entire Board was and is likely to continue to conspire against her, the Court has no doubt that Ortega's testimony is sincere and that her feelings of distrust, lack of confidence, and trauma from her experiences with the Board (apart from her experiences with the principal) are very real. Those feelings were exacerbated by the hundreds of rejections she received of her CPS job applications following her termination from June 2010 through June 2012. The Court also believes that returning to the Board's employment as a reassigned teacher would indeed, as Ortega testified, feel to her like "insult to injury." Id. at 10 (¶ 15). Given that Ortega's feelings are sincere, the only additional question is whether they are a valid legal basis for rejecting the Board's offer of reinstatement.
The Board argues Ortega's feelings are not a valid basis for turning down reinstatement because they are not justified by actual, currently existing workplace hostility. But several courts have rejected that argument. See, e.g., Stafford v. Elec. Data Sys. Corp., 749 F.Supp. 781, 785 (E.D. Mich. 1990); Eivins v. Adventist Health Sys./E. & Middle Am., Inc., 660 F.Supp. 1255, 1263 (D. Kan. 1987). Instead, "courts have determined that reinstatement is not practicable — and, thus, not a viable remedy — in cases where, as here, even though there is no evidence of open hostilities between the defendant-employer and the plaintiff-employee ..., there is evidence that the employer-employee relationship has been irreparably damaged as a result of the post-discharge litigation." Stafford, 749 F.Supp. at 785-86.
In one case, the Third Circuit rejected the argument that animosity did not prevent reinstatement because the supervisors who discriminated against the plaintiff were no longer employed by the defendant. Feldman v. Philadelphia Hous. Auth., 43 F.3d 823 (3d Cir. 1994). The Third Circuit held that, although the plaintiff initially had requested reinstatement, his request after trial to have reinstatement excluded as a potential remedy was properly granted by the district court over the defendant's objections due to the district court's finding of "irreparable distrust and animosity" that had developed between the plaintiff and the defendant "as a result of the events prior to [the plaintiff's] termination, the termination itself, and the litigation that followed in its wake." Id. at 832 (internal quotation marks omitted, emphasis added); see also U.S. Equal Emp't Opportunity Comm'n v. E.I. Du Pont de Nemours & Co., 406 F.Supp.2d 645, 662 (E.D. La. 2005) (citing to the plaintiff's evidence that her employer "recklessly disregarded [her] rights under the ADA," and "maintained throughout the course of the litigation that [she] [was] not qualified to work at [the defendant]"), aff'd in part, rev'd in part on other grounds, 480 F.3d 724 (5th Cir. 2007).
In another case, the plaintiff conceded the lack of "`open hostilities' between himself and former [] co-workers/supervisors," but argued that any honest and trusting employer-employee relationship he may have had with [his former employer] and its managerial personnel during
Id. (internal citations omitted).
In an attempt to directly address Ortega's loss of faith in the Board as an employer, the Board's offer of reinstatement includes a provision that if Ortega believed she was being treated unfairly, she could appeal directly to the Board's attorney in these post-trial proceedings, who represented to the Court she would personally assume responsibility for resolving the issue. While the Court appreciates the motivation behind this promise, Ortega is entitled to question (as she does) the ability of the Board's counsel to advocate on her behalf, or, at the very least, to act in a neutral capacity as opposed to in the bests interests of the Board. Moreover, in the end, the Board is suggesting the exact sort of thing that the Seventh Circuit (and the Stafford court, above) recognized was a good reason for denying reinstatement:
Id. at 325-26 (emphasis added).
Aside from the practicality of reinstatement in these circumstances, several courts also have recognized that reinstatement may not be viable "because of psychological injuries suffered by the plaintiff." Abuan v. Level 3 Commc'ns, Inc., 353 F.3d 1158, 1176 (10th Cir. 2003) (internal quotation marks and citation omitted); see also E.I. Du Pont de Nemours & Co., 406 F.Supp.2d at 662 ("The emotional baggage that [the plaintiff] carries as a result of [the defendant's] discrimination may affect her work performance to such an extent that reinstatement is not an adequate remedy."); Eivins, 660 F.Supp. at 1262, 1263 (ordering front pay over reinstatement upon finding that "`a productive and amicable working relationship [between the plaintiff and the defendant] would be impossible,'" because, among other things, the "plaintiff testified, and the evidence indicated, that his self worth was crushed
Like the plaintiffs in the above cases, Ortega's perceptions about the Board's post-termination conduct, whether accurate or not, may be sufficiently strong and extreme as to render reinstatement an inadequate remedy, because her perceptions have destroyed her "ability to be an effective member of Defendant's workforce." Abuan, 353 F.3d at 1178; see also Price, 966 F.2d at 325 (finding that the "lawsuit irrevocably impaired [the plaintiff's] ability to function as an auditor at [the defendant]"). This Court concludes, as another court did, that "the strongest factor disfavoring reinstatement" is Ortega's testimony that the Board's post-termination conduct had a "devastating impact ... on her self-esteem and self-worth," and that "[r]einstatement under these conditions would be counter-productive to [the Board] and an empty remedy to [Ortega]." Ogden v. Wax Works, Inc., 29 F.Supp.2d 1003, 1016 (N.D. Iowa 1998); see also Baker v. John Morrell & Co., 263 F.Supp.2d 1161, 1173 (N.D. Iowa 2003) (plaintiff's testimony demonstrates "that it would be unjust and insensitive to place her back in the workplace").
Front pay begins when back pay ends (date of judgment) and continues for whatever period of time will make the plaintiff whole. Barbour v. Merrill, 48 F.3d 1270, 1279-80 (D.C. Cir. 1995), which is to say, through the date "when the sting of discrimination has passed and the victim has had a reasonable amount of time to secure comparable employment," Barbour v. Medlantic Mgmt. Corp., 952 F.Supp. 857, 866 (D.D.C.), aff'd sub nom. Barbour v. Merrill, 132 F.3d 1480 (D.C. Cir. 1997). See Williams, 137 F.3d at 954 (front pay awards typically are limited in duration, depending on when the plaintiff did or could "reasonably be expected to have moved on to similar or superior employment"); Gracia, 130 F.Supp.3d at 1255 (front pay continues until "some reasonable point in the future"). Although "[d]amages in employment discrimination cases are not intended to insure a plaintiff's future financial success," McKnight II, 973 F.2d at 1372, front pay awards are by their nature fashioned amidst some degree of speculation, Williams v. Pharmacia Opthalmics, Inc., 926 F.Supp. 791 (N.D. Ind. 1996). While an award of front pay "must be grounded in available facts, acceptable to a reasonable person and not
The plaintiff bears the initial burden of providing the district court "with the essential data necessary to calculate a reasonably certain front pay award," including "the amount of the proposed award, the length of time the plaintiff expects to work for the defendant, and the applicable discount rate." McKnight II, 973 F.2d at 1372. "In deciding whether to award front pay, the court considers such factors as whether the plaintiff has a reasonable prospect of obtaining comparable employment, whether the time period for the award is relatively short, whether the plaintiff intended to work or was physically capable of working and whether liquidated damages have been awarded." Id. at 1141.
Ortega testified that prior to her termination she intended to work as a teacher, and, specifically, for the Board, until retirement age. Although there was
Neither party provides the Court with an exact pension vesting date. It is undisputed, however, that Ortega's pension would have vested had she not been terminated on or about her 20 year service anniversary date. The evidence showed that Ortega was first employed by the Board on January 28, 1998, so if that date were the date for when the pension vesting period began to run, vesting would occur on January 28, 2018. But the Board represents that when Ortega's full salary and benefits were terminated in June 2010, she had worked for the Board for eleven years, R. 144 at 8, which means, had she not been terminated, she could have anticipated her pension vesting approximately nine years later or sometime in 2019. Since both parties appear to agree that the correct date is approximately four years after the date of trial (which concluded on October 19, 2015), the Court will use October 31, 2019 as the pension vesting date.
Pursuant to the Court's discussion on the back pay issue earlier in this opinion, Ortega will be receiving back pay through November 30, 2017. Therefore, if Ortega's pension-vesting date is chosen for termination of the front pay award, Ortega would be entitled to front pay for a period of 23 months (December 1, 2017 through October 31, 2019).
The Court concludes that Ortega's request for 23 months in front pay is reasonable and not overly speculative. In Pierce, the Seventh Circuit upheld an award of front pay for a period of ten years based on the plaintiff's testimony that his intention had been to work until his retirement. 65 F.3d at 574. The district court found that the plaintiff "`was as likely as any and probably more likely than most to work to retirement if he had the ability to do that' because his job was of `immense importance' to him and was `the main source of his sense of who he was and his pride.'" Id. The Seventh Circuit said that the district court was justified in relying on the plaintiff's testimony concerning how long he had planned to work for the defendant because it was supported by the defendant's "normal retirement age" and the fact that "an employee would receive reduced retirement benefits if he resigned before that time." Id. While only one-half of the defendant's employees "actually worked to that age, the [district] court gave specific reasons why it believed [the plaintiff] would have been one of those employees." Id.; see also Whittlesey v. Union Carbide Corp., 742 F.2d 724, 729 (2d Cir. 1984) (district court "was within [its] discretion in allowing front pay for the full period from trial until [the plaintiff] would reach age 70, when compulsory retirement could be imposed without violating the ADEA," because the four-year
Similarly, here, the Court find's Ortega's testimony that, given her qualifications, exemplary job performance, and thirteen years of experience as a teacher at Hedges, it was realistic for her to expect to have worked as a teacher with CPS through her retirement age to be credible. The Court credits Ortega's commitment to teaching, her testimony that she derived much of her self-esteem from her position as a tenured teacher, and her incentive to continue in her teaching position until her pension would have vested, as justifying using, at a minimum, her pension-vesting date as the date through which front pay should run. In addition, the Court considers other factors, such as the relatively short 23 month period between now and the vesting date, Ortega's age, and the longevity of her employment with the Board prior to her termination, as justifying a front pay period through the pension-vesting date.
The Board has taken a two-prong approach in arguing that the front pay award sought by Ortega is unduly speculative. First, the Board argues that Ortega has a reasonable prospect of obtaining comparable employment sooner but for her failure to mitigate her damages. "When a defendant's front pay objection is predicated upon the same objections regarding mitigation of damages which we have rejected with regard to back pay, we reject the front pay argument as well." Donlin, 581 F.3d at 86; see also Washington, 2016 WL 3058377, at *9 ("Despite her efforts to find comparable employment, Washington has failed to do so, earning less than her OSAD salary in every year since she resigned."). It is speculative to say that Ortega would likely be able to find a permanent teaching position if she kept looking in the next few years, particularly in light of her more than three hundred previous applications for such a position, all of which were rejected. In addition, while the Board claims there are comparable positions available to Ortega, it also suggests that future lay-offs are expected because of the poor financial condition of the State and the Pension Fund.
Second, the Board also argues the opposite, namely, that Ortega would likely have been laid off prior to her pension vesting date. The Board's present contention that Ortega might have been subject to lay-off
As the Board's only objections to front pay lack merit, the Court will award Ortega front pay through October 31, 2019.
Turning to the calculation of the 23 month front pay award, the fact that Ortega's actuary did not testify regarding the amount of a front pay award does not prevent this Court from using his testimony to make its own front pay calculation. See Downes, 41 F.3d 1132, 1142-43 (affirming where the district court based its front pay calculation on estimates derived by one of the plaintiff's experts at trial (an actuary), who testified only as to back pay calculations). The first step in calculating Ortega's front pay is to determine what her annual salary would have been for the years in question. Earlier in this opinion, the Court calculated Ortega's salary for the 2017-2018 school year less Ortega's pension contribution as $97,410. Using this figure, the Court calculates Ortega's gross lost wages from December 2017 through June 2018 (7 months) as follows: $97,410 x 7/10 = $66,187.
As discussed previously in this opinion, the Court will add a two percent pay increase for each of the following school years (2018-2019 and 2019-2020), and then subtract Ortega's required pension contribution of 2 percent to arrive at an annual salary figure to use in calculating a gross lost wages for the remaining two years in which front pay will be awarded:
Academic Year Annual Employee Net Annual Salary Salary Pension [annual salary less Contribution pension contribution] August 2018-June $101,386 $2,028 $99,358 2019 [$99,398 + 2%] August 2019-June $103,414 $2,068 $101,346 2020 [$101,386 + 2%]
Thus, Ortega's gross lost wages for August 2018 through June 2019 is $99,358, and her gross lost wages for August 2019 through October 2019 (three months) is $101,346 × 3/10, or $30,404.
To arrive at a total front pay award, the Court must subtract Ortega's anticipated actual wages in the applicable time period from her gross lost wages. The Court will start with the actual earnings figure it previously used for the 2016-2017 academic year of $53,212, and apply an additional 2 percent increase for each year thereafter. This results in $54,276 for Ortega's actual earnings in the 2017-2018 school year; $55,362 for Ortega's actual earnings in the 2018-2019 school year; and $56,469 for Ortega's actual earnings in the 2019-2020 school year.
Applying these calculations leads to the following summary of Ortega's front pay award:
Period (a) (b) (a)-(b) Projected Gross Projected Actual Net Front Pay Lost Wages Earnings Amount December 2017 S66,187 $37,993 $28,194 through June 2018 [$54,276 × 7/10] July 2018 through S99,358 $55,362 $43,996 June 2019 July 2019 through S30,404 $16,941 $13,463 October 2019 [$56,469 × 3/10]
Ortega's total front pay award is $85,653. The Court will apply the present cash value rate suggested by Ortega of 2.5% (to which the Board offers no objection), to arrive at a discounted front pay award of $83,512.
The Seventh Circuit has said that, "[i]n order to make plaintiffs whole, a discharged employee should be compensated for pension benefits lost through the wrongful termination." Graefenhain, 870 F.2d at 1212; see also Loeb v. Textron, Inc., 600 F.2d 1003, 1021 (1st Cir. 1979) ("Pension benefits are part of an individual's compensation and, like an award of back pay, should be awarded."). "If a prevailing plaintiff is returned to the defendant's employment, this award will consist of payments to the pension fund on plaintiff's behalf, bringing plaintiff's pension interest to the level it would have reached absent discrimination." Loeb, 600 F.2d at
The first option is to award Ortega "whatever would have been paid into the pension fund on [her] behalf." Id. The Board appears
The second option is for the Court to treat Ortega as a vested employee entitled to receive a pension award based on employment from when she was first hired until damages are settled, and to liquidate her pension benefits as of that date. Loeb, 600 F.2d at 1021. Even though Ortega is not yet vested in her pension, the Court can treat her as vested for purposes of the pension award because the Board should "not be allowed to stand on [vesting] requirements that plaintiff cannot meet because of the employer's own wrongful acts." Id. Under this approach, the Court "should approximate the present discounted value of plaintiff's interest." Id. Just as with back pay, the award should be computed as if plaintiff had been employed until the date damages are settled." Id.
Ortega seeks an award of pension benefits using this second approach. That is, she seeks an award of the present value of her lost pension benefits incurred as a result of her termination, and she presented the testimony of her actuary to support that award. R. 184 at 110. The formula used by the actuary to arrive at his estimate of Ortega's lost pension benefits was based on an annual salary figure he calculated according to the governing rules of the Fund. To apply those rules, the actuary had to make certain assumptions about what Ortega's future salary would have been had she not been terminated. After making those assumptions and applying the formula, the actuary arrived at an average annual salary figure of $93,891. Ortega's anticipated pension amount is based on that average annual salary figure. R. 184 at 113. According to the actuary, this average salary figure led to a monthly pension benefit amount of $2,927.
The Court rejects the Board's approach to calculating Ortega's pension benefits because it does not come close to placing Ortega in the same position she would have been in had she not been unlawfully terminated. Instead, the Court concludes that the second approach used by Ortega's actuary is the more appropriate method for calculating Ortega's lost pension benefits
The actuary calculated the amount of Ortega's lost pension benefits to be $515,990. He arrived at that figure by assuming Ortega would have started to receive her pension at the age of 62, and used a mortality table to estimate the total period of time for which the monthly pension would have been payable. He then added up each monthly payment and discounted the total to its present value using the discount value of 2.5 percent for the first 20 years and 2.85 percent thereafter. R. 184 at 114. Because the actuary has provided the Court with a reasonable basis to calculate a cash-out pension award, and the Board does not present any evidence to contradict the actuary's calculations, the Court finds that Ortega has met her burden of proof on establishing an amount for her lost pension benefits. The actuary's calculations were based on higher salary figures than the ones adopted by the Court in this opinion. Nevertheless, the difference is only slight and those slightly higher figures are more than offset by the fact that the actuary used an earlier settlement date for calculating Ortega's lost pension benefits than that to which Ortega otherwise would have been entitled.
Even if the Court were to consider the Board's arguments, it likely would find that they lack merit. On the first issue, social security payments are collateral to pension benefits, and under the collateral source rule the Court does not take those payments into account in determining the proper award of employment discrimination damages. See O'Grady, 857 F.2d at 389-90. In addition, the actuary testified that any social security benefit to which Ortega potentially would be entitled as a result of no longer working for the Board would likely not be realized. See R. 184 at 138-39.
On the second issue, Ortega testified she took a cash pay-out from her teacher's pension fund in the amount of the $60,419 because of the financial stress she was experiencing after being terminated from her job. R. 184 at 162-63. The actuary testified that he took into account the cash payout by reducing his net pension loss amount by the amount Ortega received from the payout. Id. at 114-15.
The actuary also testified that if Ortega had not taken the cash payout, her net pension loss would have been reduced to only $169,273 (as opposed to the $515,990 cash out value he was estimating it to actually be). An argument could be made that Ortega should be responsible for the higher pension loss she incurred because she voluntarily cashed in the pension. But the Court is not convinced of the merits of that argument. For example, in Hillmann v. City of Chicago, 14 F.Supp.3d 1152 (N.D. Ill.), on reconsideration in part, 66 F.Supp.3d 1109 (N.D. Ill. 2014), and aff'd in part, rev'd in part on other grounds and remanded, 834 F.3d 787 (7th Cir. 2016), the defendant argued "that any injury Plaintiff suffered as a result of withdrawing the money in his pension account was too remote and unforeseeable a consequence to have been caused by his termination, and the [defendant] is not liable." Id. at 1195. The district court held that the jury considered the defendant's argument
In any event, the Board's argument regarding Ortega's withdrawal of funds from her teacher's pension all but ignores the question of whether the Board or Ortega should bear the burden of the higher loss occasioned by Ortega's withdrawal of her retirement funds. Instead, the Board's primary argument is that Ortega could mitigate the loss caused by her withdrawal of the pension funds by relying on the Reciprocal Act. According to the Board, the Reciprocal Act allows a person like Ortega who works for multiple public entities over time to patch together the necessary service credits to vest in her pension though service at more than one agency. R. 184 at 142.
In the first place, the actuary testified that even if Ortega took advantage of the Reciprocal Act, she still would suffer a pension loss in the amount of approximately $169,273. R. 184 at 114-15. Based on the actuary's testimony, the Court finds that, at the very least, Ortega would be entitled to recover $169,273 in lost pension benefits, not zero pension benefits as the Board argues. More problematic for the Court, however, is the fact that the Board did not actually present any evidence to establish that Ortega satisfied all the technical requirements of the Reciprocal Act to avoid any pension losses other than the $169,273 to which her actuary testified. Thus, the Court cannot say based on the current record that Ortega in fact would be able to reestablish her pension along the lines argued by the Board. While the Board's counsel asked Ortega's actuary questions suggesting Ortega's losses could be avoided through use of the Reciprocal Act, questions of counsel are not evidence. And the actuary's testimony in response to those questions confirms the Reciprocal Act's application in only the broadest terms. No actual analysis of whether Ortega could in fact satisfy the requirements of the Reciprocal Act was performed. For instance, the Board could have presented expert testimony of the State Employees Retirement System demonstrating the application of the Reciprocal Act to Ortega's current state pension. This is an issue of mitigation on which the Board bears the burden of proof, as opposed to an issue of damages on which Ortega bears the burden
The only other issue raised by the Board is whether the actuary properly accounted for any pension benefits Ortega will receive from her current job with the state government. In Graefenhain, the Seventh Circuit recognized that "`[pension] benefits may not be available where an award would make a plaintiff more than whole, such as ... where [the] defendant can prove that the new employer's pension plan would provide plaintiff with approximately the same benefit he lost due to the defendant's discriminatory firing.'" 870 F.2d at 1212 (quoting Blum, 829 F.2d at 373). The actuary testified that he accounted for Ortega's state pension fund by applying a $6,497 offset to Ortega's estimated lost teacher's pension benefits, an amount which represents Ortega's total contributions to the State Employees' Retirement System through the settlement date of August 15, 2016 used by the actuary. See R. 184 at 114-15. In other words, while the actuary chose the second method of cash-out value for calculating Ortega's pension loss from her teacher's pension, he used the first method of adding together contributions made to the fund in calculating Ortega's pension benefits from her current job. He testified this approach was proper because Ortega was not vested in her state pension fund as of the settlement date of August 15, 2016. Because he could not predict whether she would ever become entitled to future pension payments from the state fund, he did not account for such potential payments in his lost pension benefit calculations and instead only credited her with the funds put in and which she would be entitled to take out if she left her current state government job without the pension ever vesting. See R. 184 at 137.
There is some logic to the actuary's approach. Whether Ortega ultimately becomes entitled to future pension benefits from her current state pension is presently unknown, dependent on whether she remains employed in her current job long enough for that pension to vest. The most recent statement in the record from Ortega's state pension account dated June 30, 2016 indicates that her state pension will vest with eight years of service, that she had 38 months of service credit as of the June 30, 2016 statement date, and that if her pension ultimately does vest, she will receive a pension in the amount of $1,691 per month. If the Court were to offset the actuary's $2,927 lost monthly benefit amount with the $1,691 pension benefit Ortega will gain if she becomes entitled to her state pension, then her lost pension benefit from her job with the Board would only be $1,236 per month. The anticipated vesting date for Ortega's state pension is in approximately 3.5 years (on or about May 1, 2021).
On the one hand, if the Court awards Ortega the full amount of her pension loss to which the actuary testified, it runs the risk of over-compensating Ortega should her state pension ultimately vest. On the other hand, if the Court awards Ortega the amount of her pension loss to which the actuary testified less the amount of her expected state pension, it runs the risk of under-compensating Ortega should her state pension ultimately not vest. Accordingly, the Court will choose a middle course. The Court will reduce Ortega's lost pension benefit award as testified to by her actuary by the difference between $2,927 and $1,236,
Based on the foregoing analysis, the Court awards Ortega the following equitable relief:
The Court will retain jurisdiction until August 1, 2021, and if, at that time, no motion has been filed for additional lost pension benefits, the case will be dismissed with prejudice.
