Governor Walker Signs Bill Eliminating Compensatory and Punitive Damages for WFEA Violations

March 30, 2012

The Wisconsin Assembly passed a bill on February 21, 2012, eliminating compensatory and punitive damages awards for violations of Wisconsin’s Fair Employment Act (WFEA). This bill was passed by the Wisconsin Senate in November 2011, and was signed into law by Governor Walker on April 5th. This law reverses a law from the Doyle administration that was passed in 2009, that mirrored Title VII and provided for compensatory and punitive damages up to $300,000. The law applies to all future complaints as well as all pending complaints where a final determination has not been reached by the Labor and Industry Review Commission (LIRC) or the Department of Workforce Development (DWD).

Current law
Under the 2009 law passed by the Doyle administration, a person alleging discrimination in employment or unfair honesty or genetic testing may file a complaint with the DWD seeking action that will effectuate the purpose of the fair employment law, including reinstating the employee, providing back pay, and paying costs and attorney fees. In addition, the fair employment law permits DWD or a person who has been discriminated against or subjected to unfair honesty or genetic testing to bring an action in circuit court to recover compensatory and punitive damages caused by the act of discrimination or unfair honesty or genetic testing after the completion of all administrative proceedings before DWD and LIRC concerning the violation. If the circuit court finds that an employer has committed an act of discrimination or unfair honesty or genetic testing, the circuit court must order the employer to pay to the employee discriminated against compensatory and punitive damages in an amount that the circuit court finds appropriate, subject to certain limitations, as follows:

  1. If the employer employs 100 or fewer employees, $50,000.
  2. If the employer employs more than 100 but fewer than 201 employees, $100,000.
  3. If the employer employs more than 200 but fewer than 501 employees, $200,000.
  4. If the employer employs more than 500 employees, $300,000.

This new Walker law eliminates the awarding of compensatory and punitive damages to persons who have been discriminated against in employment or subjected to unfair honesty or genetic testing. DWD may still award to such an employee back pay, costs, attorney fees, and reinstatement (or front pay).

Bottom line
This law is good news for Wisconsin employers. Employees who decide to pursue their claims administratively will not have the ability to recover compensatory and punitive damages. Depending on the underlying claims, some employees may chose to pursue cases in federal court. However, employers have the benefit of being able to avail themselves of summary judgment in many federal employment cases. Administrative claims under the WFEA are not subject to summary judgment and must go to a hearing on the merits of the complaint if probable cause has been found.