The 2003 Illinois case of Cress v. Recreation Services, Inc. provides an illustration of the types and amounts of damage awards an employee may recover in the context of an employment termination suit.
The Plaintiff, Donald L. Cress (“Cress”), was an employee of Recreation Services, Inc. (“RSI”), which operated bowling alleys in the southwestern and western suburbs of Chicago. During his employment with RSI, Cress entered into a Deferred Compensation Agreement, which provided a guarantee of employment until age 65 and contained a provision for monthly retirement benefits.
Prior to his termination, RSI’s President, Larry Donovan (“Donovan”), told Cress he was negotiating a sale of RSI to Brunswick Corp. (“Brunswick”). After the sale to Brunswick, Donovan offered Cress a consulting position wherein he would remain an employee of RSI and provide consulting services to Brunswick for one year in exchange for compensation in the amount of $150,000.00. Cress accepted the position but was terminated prior to attaining age 65.
Cress filed suit against RSI, alleging that his termination prior to age 65 violated the terms of the Deferred Compensation Agreement. He also sued Donovan for tortious interference with contract. Finally, Cress alleged that the termination subjected him to trauma and humiliation and resulted in depression and anxiety.
Cress prevailed at trial. The jury awarded damages totaling almost $4 million, allocated as follows:
Amount
| Damage Received For
|
$580,833
| Breach of contract
|
400,000
| Loss of a normal life
|
400,000
| Emotional distress
|
700,000
| Lost compensation
|
1,000,000
| Punitive damages
|
354,575
| Attorney’s fees and costs pursuant to the Employment Retirement Income Security Act
|
391,574
| Retirement benefits
|
$3,826,982
| Total
|
*Although damages for loss of a normal life are typically awarded in the context of personal injury cases, the court awarded Cress such damages to compensate him for the disruption he suffered as a result of his termination.
The trial judge, however, reduced Cress’ damages by $580,833, holding that the damages for lost compensation duplicated the damages for breach of contract. On appeal, the appellate court agreed with RSI and Donovan that the Agreement provided for monthly payments of additional compensation but did not authorize a lump sum payment, and that the punitive damages award was inappropriate since Donovan’s conduct was not so egregious as to warrant such an award.
The Cress case demonstrates the types and amounts of damages that an employee may recover in an employment termination suit. Although the amount of punitive damages awarded was subsequently vacated by the appellate court, RSI was still liable for over $2 million in damages.