The statute of limitations for wrongful termination in California

The California statute of limitations for wrongful termination is two years for implied breach of contract- or public policy violations and three years for FEHA violations, WARN Act violations, or whistleblower retaliation.

Certain federal wrongful termination laws use a lengthier statute of limitations. However, many laws require you to file an administrative complaint first, before bringing a lawsuit. An EEOC claim must be filed within 180 days of your termination in order to be considered timely.

What is the statute of limitations for wrongful termination in California?

For wrongful termination claims in California, the applicable statute of limitations will depend on why the discharge was unlawful.

Some of the most common situations are when the termination:

• breached an implied contract of continued employment,
• violated public policy,
• was in retaliation for exercising rights under California’s Fair Employment and Housing Act (FEHA),
• was done pursuant to a mass layoff and violated the California Worker Adjustment and Retraining Notification (WARN) Act, or
• violated state law or the federal Sarbanes-Oxley Act by retaliating against whistle-blowing activities.

Depending on which of these circumstances is at issue, the statute of limitations can be between 2 and 4 years. An employment lawyer or a wrongful termination lawyer from a reputable law firm can help you understand the amount of time you have to file your particular civil action.

Breach of implied contract – 2 years

If you do not have an employment contract in California, but you have been fired in violation of an implied contract not to terminate except for good cause, you have 2 years from the date of the termination to file a lawsuit.¹ This statute of limitations applies to

• breach of contracts and oral contracts,
• including non-written employment contracts.

These lawsuits are quite rare. Most California workers have a contract and are considered at-will employees.

Violation of public policy – 2 years

A lawsuit for wrongful termination in violation of public policy can be brought within 2 years of the date of the termination.² Terminations violate public policy if you are fired for:

• refusing to violate the law,
• carrying out a legal obligation,
• exercising your rights or privileges under the law, or
• reporting a potential violation of an important law.³

California wrongful termination law gives you a cause of action in these situations, even if your employment state is explicitly at-will employment.

FEHA retaliation – 3 years

Employers who retaliate by firing you because you invoked or exercised a right under FEHA commit a wrongful termination. You have 3 years from the date of the termination to file an administrative complaint with the California Civil Rights Department (CRD, formerly called DFEH for Department of Fair Employment and Housing).⁴

Once you receive a notice of right to sue letter from the CRD, you have 1 more year to file a wrongful termination lawsuit against your employer.⁵

FEHA retaliation terminations are similar to those that violate public policy. They include terminations that took place because you:

• opposed or filed a complaint about workplace harassment or sexual harassment,
• initiated a claim under an employment discrimination law on the basis of:
  • gender,
  • sexual orientation,
  • national origin,
  • race, or
  • any other protected trait;
• challenged the employer’s refusal to grant leave under an applicable pregnancy, family, or medical leave act,
• cooperated with an investigation about the employer’s alleged discrimination or harassment,
• testified or assisted in a FEHA proceeding, or
• requested a workplace accommodation for your disability or religious belief.⁶

Violation of WARN Act – 3 years

Terminations that are wrongful because they violate California’s WARN Act come with a 3-year statute of limitations.⁷ The WARN Act requires covered employers to give you at least 60 days of notice before a:

• mass layoff,
• plant closure, or
• major relocation.⁸

Employers are covered by the WARN Act if they have employed at least 75 employees in the last 12 months.⁹

Whistleblower retaliation and Sarbanes-Oxley Act – 3 years

Termination can also be wrongful if it was done to retaliate against you for blowing the whistle on wrongdoing in the workplace. In California, these are generally covered by California Labor Code section 1102.5 LAB. Claims made under this statute have to be filed within 3 years.¹⁰ This state law can cover terminations for:

• reporting wage and hour law violations to the Labor Commissioner,
• bringing evidence of the employer’s suspected criminal activity to a law enforcement or government agency, or
• making an allegation of suspected wrongdoing internally to a supervisor or to someone else with the authority to investigate.

If you blow the whistle on suspected securities fraud by your employer, you also have protections under the Sarbanes-Oxley Act. If you have been wrongfully terminated under this Act, you have to file an administrative complaint within 180 days.

The Department of Labor then has 180 days to act on the complaint. If they do not, you can file a lawsuit against your employer. This lawsuit has to be filed within 4 years of the date of termination.¹¹

What is a statute of limitations?

The statute of limitations is the time period during which you can file a lawsuit. It generally begins to run when you (the victim of someone else’s wrongful conduct) either:

• have been hurt in some way, or
• have discovered that you have been hurt.

When the statute of limitations has expired, you can no longer invoke your legal rights. If you try to sue after the time limit has run, the defendant can have the case dismissed quickly.

Statutes of limitations serve several purposes, including:

• pushing you to invoke your rights quickly,
• allowing defendants to repose once a sufficient period of time has passed, and
• ensuring that evidence and memories of the incident are fresh for the case.

What is wrongful termination?

Wrongful termination happens when an employer fires, discharges, or lays you off for an illegal reason.

Under California law, the most common illegal reasons for terminating a worker include:

• retaliation,
• discrimination, and
• violation of public policy.

Wrongful terminations can also be constructive terminations. Constructive dismissal happens when you quit because your employer has made the working conditions so bad that a reasonable person would see that they have no alternative but to resign.

Why do some laws require an administrative process before I can sue?

Some employment laws, particularly federal laws, require you to file an administrative complaint first, often with the Equal Employment Opportunity Commission (EEOC).

This additional process is meant to vet the merit of the claim and resolve the case outside of the courtroom. It generally involves mediation or arbitration. This reduces the costs of bringing and defending against the claim. It also conserves the limited resources of the judicial system.

Only if the administrative process does not resolve the dispute can you file a wrongful termination case in court.

Note that whether you have to file an administrative complaint first before pursuing a traditional lawsuit depends on the particular case. An attorney can help you determine your options.

What is the average payout for wrongful termination in California?

California labor law attorneys see wrongful termination settlements ranging from a few thousand dollars to a million dollars or higher. No average settlement amount for wrongful termination exists because so many different factors determine the final payout, such as:

• your salary at the time of termination,
• your lost benefits,
• your job title,
• your job history, and
• the circumstances leading to your termination, such as harassment or discrimination.

Damages we seek include:

• your back pay (including any wages and overtime in dispute),
• reinstatement,
• emotional distress, and/or
• attorney’s fees.

The wrongful termination statute of limitations in California is two or three years depending on the legal grounds.

Additional reading

For more in-depth information, refer to these scholarly articles:

• Wrongful termination and the expanding public policy exception: Implications and advice – SAM Advanced Management Journal.
• The Legal Consequences of a Wrongful Termination – Constitutional Law International.
• At Will Employment Agreements: New Focus for Shielding Employers from Wrongful Termination Suits – Western State University Law Review.
• Past, Present, and Future in Wrongful Termination Law – Labor Law.
• Demonstrating Failure To Discharge Plaintiffs Duty To Mitigate In A Wrongful Termination Case: An Empirical Approach – Journal of Business of Economics Research.