In arbitration, advocates for suspended or discharged employees routinely argue for a “make whole” remedy, which includes back pay and restoration of benefits and seniority rights. The idea is that a worker should be put into the position he would have been in had the employer not wrongfully suspended or fired him. However, it wasn’t until one such employee tearfully told me he had to postpone his wedding after being discharged that I realized how misleading the term “make whole” really can be. Here was a young guy who, because his employer wrongfully terminated him, had to put off his plans to build a career and start a family for over a year. Even if the union could convince the arbitrator to reinstate him (we did) and even if the arbitrator awarded full back pay (he did) there was no way that the ultimate award could really make the grievant “whole.”
The Hidden Costs of Losing One’s Job
Postponing a wedding may seem like a relatively minor sacrifice, but consider the other real and potential consequences of losing one’s livelihood, even temporarily: employees have lost homes, gone without medication, or even lost custody of children while challenging their discharge or suspension. For them, it is wonderful to return to work with back pay, but that remedy cannot compensate them for the time they had to live out of their cars, forgo necessary medications or live without their kids.
The Limited Reach of the Arbitrator
Arbitrators generally do not award “consequential damages” even where an employee has clearly been wronged. This is not surprising given that many arbitrators feel that they do not even have the authority to award interest on back pay as part of a “make whole” remedy. There is a general reluctance among arbitrators to award anything beyond back pay without making up for any additional financial loss resulting from the unjust disciplinary action.
Arbitrators’ willingness and authority to grant particular remedies are among the many complex issues that can be blogged about another day. For now, however, it is worth considering that arbitration remedies remain limited and that the loss of one’s livelihood, whether permanently or temporarily, means a lot more than simply the loss of one’s paycheck.