California Civil Jury Instructions (CACI) (2017)

2407. Breach of Employment Contract - Unspecified Term— Employee's Duty to Mitigate Damages

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2407.Affirmative Defense—Employee’s Duty to Mitigate Damages
[Name of defendant] claims that if [name of plaintiff] is entitled to any
damages, they should be reduced by the amount that [he/she] could
have earned from other employment. To succeed, [name of defendant]
must prove all of the following:
1. That employment substantially similar to [name of plaintiff]’s
former job was available to [him/her];
2. That [name of plaintiff] failed to make reasonable efforts to seek
[and retain] this employment; and
3. The amount that [name of plaintiff] could have earned from this
employment.
In deciding whether the employment was substantially similar, you
should consider, among other factors, whether:
(a) The nature of the work was different from [name of plaintiff]’s
employment with [name of defendant];
(b) The new position was substantially inferior to [name of
plaintiff]’s former position;
(c) The salary, benefits, and hours of the job were similar to
[name of plaintiff]’s former job;
(d) The new position required similar skills, background, and
experience;
(e) The job responsibilities were similar; [and]
(f) The job was in the same locality; [and]
(g) [insert other relevant factor(s)].
[In deciding whether [name of plaintiff] failed to make reasonable efforts
to retain comparable employment, you should consider whether [name
of plaintiff] quit or was discharged from that employment for a reason
within [his/her] control.]
New September 2003; Revised February 2007, December 2014
Directions for Use
This instruction may be given when there is evidence that the employee’s damages
could have been mitigated. The bracketed language at the end of the instruction
regarding plaintiff’s failure to retain a new job is based on the holding in
Stanchfield v. Hamer Toyota, Inc. (1995) 37 Cal.App.4th 1495, 1502–1503 [44
Cal.Rptr.2d 565].
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In deciding whether the plaintiff could have obtained a substantially similar job, the
trier of fact may consider several factors, including salary, benefits, hours of work
per day, hours of work per year, locality, and availability of a merit-based system.
(See California School Employees Assn. v. Personnel Commission (1973) 30
Cal.App.3d 241, 250–255 [106 Cal.Rptr. 283].) Read only those factors that have
been shown by the evidence.
This instruction should be given in all employment cases, not just in breach of
contract cases. See Chin et al., California Practice Guide: Employment Litigation,
¶ 17:492 (Rutter Group).
This instruction should not be used for wrongful demotion cases.
Sources and Authority
• “The general rule is that the measure of recovery by a wrongfully discharged
employee is the amount of salary agreed upon for the period of service, less the
amount which the employer affirmatively proves the employee has earned or
with reasonable effort might have earned from other employment. However,
before projected earnings from other employment opportunities not sought or
accepted by the discharged employee can be applied in mitigation, the employer
must show that the other employment was comparable, or substantially similar,
to that of which the employee has been deprived; the employee’s rejection of or
failure to seek other available employment of a different or inferior kind may
not be resorted to in order to mitigate damages.” (Parker v. Twentieth Century-
Fox Film Corp. (1970) 3 Cal.3d 176, 181–182 [89 Cal.Rptr. 737, 474 P.2d 689],
internal citations omitted; see also Rabago-Alvarez v. Dart Industries, Inc.
(1976) 55 Cal.App.3d 91, 98 [127 Cal.Rptr. 222] [“Plaintiff concedes that the
trial court was entitled to deduct her actual earnings”]; but see Villacorta v.
Cemex Cement, Inc. (2013) 221 Cal.App.4th 1425, 1432 [165 Cal.Rptr.3d 441]
[wages actually earned from an inferior job may not be used to mitigate
damages].)
• “[B]efore projected earnings from other employment opportunities not sought or
accepted by the discharged employee can be applied in mitigation, the employer
must show that the other employment was comparable, or substantially similar,
to that of which the employee has been deprived . . . .” (Kao v. University of
San Francisco (2014) 229 Cal.App.4th 437, 454 [177 Cal.Rptr.3d 145].)
• “The burden is on the employer to prove that substantially similar employment
was available which the wrongfully discharged employee could have obtained
with reasonable effort.” (Chyten v. Lawrence & Howell Investments (1993) 23
Cal.App.4th 607, 616 [46 Cal.Rptr.2d 459].)
• “[W]e conclude that the trial court should not have deducted from plaintiff’s
recovery against defendant the amount that the court found she might have
earned in employment which was substantially inferior to her position with
defendant.” (Rabago-Alvarez,supra, 55 Cal.App.3d at p. 99.)
• “[I]n those instances where the jury determines the employee was fired from a
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substantially similar position for cause, any amount the employee with
reasonable effort could have earned by retaining that employment should be
deducted from the amount of damages which otherwise would have been
awarded to the employee under the terms of the original employment
agreement.” (Stanchfield, supra, 37 Cal.App.4th at pp. 1502–1503.)
• “The location of the new job is one of the factors to consider in determining
whether the new job is inferior.” (Villacorta,supra, 221 Cal.App.4th at p.
1432.)
• “There is some authority for the proposition that whether or not the other
employment is comparable or substantially similar or equivalent to the prior
position is a question of fact. On the other hand the issue of substantial
similarity or inferiority of employment is one that has often been decided as a
matter of law in California.” (California School Employees Assn.,supra, 30
Cal.App.3d at pp. 253–254, internal citations omitted.)
• “The court could reasonably admit the evidence of other available jobs and
leave the question of their substantial similarity to the jury.” (Kao, supra, 229
Cal.App.4th at p. 454.)
• “[S]elf-employment is not unreasonable mitigation as long as the discharged
employee applies sufficient effort trying to make the business successful, even if
those efforts fail.” (Cordero-Sacks v. Housing Authority of City of Los Angeles
(2011) 200 Cal.App.4th 1267, 1284–1285 [134 Cal.Rptr.3d 883].)
Secondary Sources
Chin et al., California Practice Guide: Employment Litigation, Ch. 17-F, Mitigation
Of Damages (Avoidable Consequences Doctrine), ¶¶ 17:490, 17:495, 17:497,
17:499–17:501 (The Rutter Group)
1 Wrongful Employment Termination Practice (Cont.Ed.Bar 2d ed.) Contract
Actions, §§ 8.40–8.41
4 Wilcox, California Employment Law, Ch. 60, Liability for Wrongful Termination
and Discipline, § 60.08[4] (Matthew Bender)
21 California Forms of Pleading and Practice, Ch. 249, Employment Law:
Termination and Discipline, §§ 249.18, 249.65 (Matthew Bender)
2408–2419. Reserved for Future Use
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