Age discrimination law suit

Patti · December 2002

My husband has a age discrimination suit which we are now negotiating. He does not have a lawyer yet. His supervisor laid him off because of his age (57). His supervisor also laid off 2 other senior employees. He now wants $25,000 as a settlement. Does he have to pay back unemployment payments that he collected in Wisconsin?

Rockie · December 2002

He needs to get an attorney post haste. I would not negotiate any type of settlement with the company directly. Obviously, they would not have his best interests at heart.

As far as unemployment, you would need to check your state laws, but I can't see where unemployment would have to be repaid in regards to an ADEA lawsuit.

Good luck.

LindaS · December 2002

I am in Wisconsin and had a situation several years ago regarding paying an employee during a layoff. The company I worked for at the time laid off several employees for different periods of time and the grievance settlement that was reached required us to pay the employees for the time they were off. I contacted the State of Wisconsin Unemployment Division inquiring about whether the employee was required to pay back the unemployment they received and I was informed by them that if the employee received the pay within a certain amount of time from when the layoffs occurred, the employee was required to pay it back. I believe the timeframe was six months from the date of the layoffs. I'm not sure how the Unemployment Division would handle an ADEA settlement so I would contact them to find out for sure.

I hope this helps! Good Luck!

Don D · December 2002

Money derived from a lawsuit is not income and taxes are not due on it. Similarly, in my opinion, since any settlement will not be 'income' it would have no affect on unemployment insurance. I think the reasoning the unemployment division used in the prior post was that this money was considered wages. Unemployment Insurance programs concern themselves only with wages in most states. So much for my 'legal' opinion for which I have no training.

Theresa Gegen TX · December 2002

Money from a lawsuit is income and taxes are due on it generally (although it may not be wages and may not be subject to withholding income taxes).

The exception is that if the money is paid to compensate for actual physical injuries, no taxes are due and it is not income.

Generally, money from an age discrimination suit will be taxed (that is how a poor plaintiff in New York, who got injunction relief and attorneys fees ended up with less after she won her lawsuit -- she had to pay taxes on the attorney fee award, and ended up with a 100,000 tax debt and no money to cover it).

There is legislation pending to make damages for employment discrimination not taxable, but it has not been passed into a law.

There are probably ways to structure the settlement so that it is not for wages, but you would most likely need to have the help of an attorney.

Good Luck!

Don D · December 2002

I admit basing my opinion on my ability to 'time travel' thereby knowing that this will shortly be enacted into law. Therefore, I delay my response by six months. Pretend you haven't seen it. (maybe I was thinking about life insurance payouts not being taxable? Or perhaps I was just seeing if Theresa was paying attention.)

Balloonman · December 2002

Don,
Good job making sure Theresa wasn't asleep at the wheel!
Hmmmm is $25K even enough? Guess it would depend on what I was making. I would be looking at the wages lost between now and 62 1/2 when I could collect SS. But that is me.
My $0.02 worth.
DJ The Balloonman

Patti · December 2002

I do not think $25K is enough! My husband is a Tool & Die Maker. He worked for the same company for 19 1/2 years. Never had a write-up, was always there, (weekends, 10-12 hour days) and never caused any problems. A new supervisor (age 35) believes everyone over 50 is to old to work. The company offered him $25K as a quick fix (no lawyers, court) to end the matter quickly. He was off of work for 6 months. He is working at this time. The problem would be if we have to pay taxes.

Mike Maslanka · December 2002

patti,hope this is working out for you,but please go see a lawyer...regards from texas,mike maslanka

Patti · December 2002

Thank you everyone who answered. Employment problems than hit this close to home are a whole new game. We are going to a lawyer. So many unanswered questions. I will let you know what happens. Thanks again

Age discrimination law suit

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