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What Damages Can I Recover for Wrongful Termination in Texas?

If you successfully prove wrongful termination in Texas, the damages (compensation) you can recover depend on which law you sued under. Most Texas wrongful termination cases involve federal discrimination or retaliation claims, which have strict damage caps ranging from $50,000 to $300,000 for compensatory and punitive damages (not including lost wages).

Texas state law follows federal damage caps in discrimination cases. Unlike California or New York, Texas does not allow unlimited compensatory damages for emotional distress in most employment cases. Understanding what you can realistically recover helps you make informed decisions about whether to pursue legal action.

This guide explains every type of damage available in Texas wrongful termination cases, what caps apply, and how courts calculate compensation.

Types of Damages in Wrongful Termination Cases

Texas wrongful termination cases can award several categories of damages:

Economic Damages (Lost Income)

Back pay: Wages lost from termination until judgment or new employment
Front pay: Future lost earnings if reinstatement is not feasible
Lost benefits: Value of health insurance, retirement contributions, stock options, bonuses

Economic damages compensate for financial losses caused by wrongful termination. These damages have no cap in most cases.

Non-Economic Damages (Emotional Harm)

Compensatory damages: Compensation for emotional distress, mental anguish, humiliation, damage to reputation, loss of enjoyment of life

These damages compensate for psychological and emotional harm. They are capped in most federal employment cases.

Punitive Damages

Punitive damages: Additional damages to punish the employer and deter future misconduct

Punitive damages are rare and only available when the employer acted with malice or reckless indifference. They are capped in most cases.

Equitable Relief

Reinstatement: Court order requiring employer to give you your job back
Injunctions: Court orders requiring or prohibiting specific conduct

Courts rarely order reinstatement in practice. Most cases settle for monetary damages instead.

Attorney Fees and Costs

Attorney fees: Payment of your lawyer’s fees
Court costs: Filing fees and litigation expenses

Many employment statutes allow prevailing employees to recover attorney fees. This can significantly increase the value of winning cases.

Federal Discrimination Claims: Title VII, ADA, and ADEA Damages

Most Texas wrongful termination cases involve federal anti-discrimination laws:

  • Title VII: Race, color, religion, sex, national origin discrimination
  • ADA: Disability discrimination
  • ADEA: Age discrimination (40+)

These laws also cover retaliation for reporting discrimination or requesting accommodations.

Available Damages

Back pay (unlimited):

  • Lost wages from termination to judgment
  • Lost overtime, bonuses, commissions you would have earned
  • Value of lost benefits (health insurance, retirement contributions)
  • Calculated from termination date until judgment or new employment

Front pay (unlimited):

  • Future lost earnings if reinstatement is inappropriate
  • Awarded when returning to the job is not feasible
  • Calculated based on how long you would have worked but for discrimination
  • Courts consider your age, career trajectory, likelihood of finding comparable work

Compensatory damages (capped):

  • Emotional distress, mental anguish, anxiety, depression
  • Humiliation, embarrassment, damage to reputation
  • Loss of enjoyment of life
  • Capped based on employer size (see table below)

Punitive damages (capped):

  • Only if employer acted with malice or reckless indifference
  • Requires showing intentional discrimination or callous disregard
  • Combined cap with compensatory damages

Reinstatement:

  • Court can order your employer to give you your job back
  • Rare in practice (relationships are too damaged)
  • Courts often award front pay instead

Attorney fees:

  • If you prevail, employer typically pays your attorney fees
  • Can be substantial (sometimes exceeding your damage award)

Damage Caps Based on Employer Size

Title VII and ADA impose strict caps on compensatory and punitive damages combined:

Employer Size (# of Employees) Maximum Compensatory + Punitive Damages
15-100 employees $50,000
101-200 employees $100,000
201-500 employees $200,000
501+ employees $300,000

Critical point: These caps apply to compensatory and punitive damages combined, not separately. If you receive $200,000 in compensatory damages from a 201-500 employee company, you can only receive $0 in punitive damages (already at the $200,000 cap).

Back pay and front pay are NOT capped. These caps only apply to emotional distress and punitive damages.

Example calculation:

  • Employer size: 300 employees (201-500 range)
  • Cap: $200,000
  • Back pay: $80,000 (not subject to cap)
  • Front pay: $120,000 (not subject to cap)
  • Compensatory damages: $150,000 (subject to cap)
  • Punitive damages: $50,000 (subject to cap)
  • Total compensatory + punitive: $200,000 (at cap)
  • Total award: $80,000 + $120,000 + $200,000 = $400,000

ADEA Age Discrimination: Liquidated Damages

ADEA (age discrimination) has no damage cap on compensatory damages. Additionally, ADEA allows liquidated damages equal to the amount of lost wages if the violation was willful.

Liquidated damages: Double your back pay if employer’s discrimination was willful (intentional or reckless)

Example:

  • Back pay: $100,000
  • Front pay: $80,000
  • Willful violation: Yes
  • Liquidated damages: $100,000 (doubles back pay)
  • Total: $280,000

ADEA does not allow compensatory damages for emotional distress (unlike Title VII and ADA). You can recover lost wages, liquidated damages, front pay, and attorney fees—but not pain and suffering.

This makes ADEA damage calculations simpler but potentially less valuable if you have significant emotional distress.

Texas Commission on Human Rights Act (TCHRA) Damages

TCHRA is Texas’s state discrimination law. It closely mirrors federal Title VII protections.

TCHRA Damage Rules

TCHRA follows federal damage caps in most cases:

  • Same caps based on employer size ($50K to $300K)
  • Back pay, front pay, compensatory, and punitive damages available
  • Reinstatement possible
  • Attorney fees for prevailing parties

Practical note: Most plaintiffs sue under both TCHRA and federal law simultaneously. Courts apply federal damage caps to avoid double recovery.

TCHRA does not meaningfully expand damages beyond federal law for most workers.

Sabine Pilot Public Policy Claims: Unlimited Damages

Sabine Pilot claims protect Texas employees fired for refusing to commit illegal acts ordered by their employer. This is a state common law tort claim, not a federal statutory claim.

Available Damages

Lost wages (unlimited):

  • Past lost earnings (back pay equivalent)
  • Future lost earnings if you cannot find comparable employment

Emotional distress damages (unlimited):

  • Mental anguish, humiliation, anxiety, depression
  • No statutory cap (unlike Title VII)
  • Jury determines reasonable amount

Punitive damages:

  • Available if employer’s conduct was especially egregious
  • Intended to punish and deter
  • No statutory cap, but subject to constitutional limits

Attorney fees:

  • May be available depending on circumstances
  • Not automatically awarded (unlike Title VII)

Constitutional Limits on Punitive Damages

While Sabine Pilot has no statutory damage cap, the U.S. Supreme Court has held that excessive punitive damages violate due process. Courts generally apply these guidelines:

  • Punitive damages more than 9 times compensatory damages raise constitutional concerns
  • Single-digit ratios (1:1 to 9:1) are usually upheld
  • Extreme misconduct may justify higher ratios

Example: If you prove $50,000 in compensatory damages (lost wages + emotional distress), punitive damages up to $450,000 (9x ratio) would likely be constitutionally permissible.

Proving Emotional Distress Damages

Unlike Title VII’s capped compensatory damages, Sabine Pilot requires proving emotional distress with evidence:

Strong evidence:

  • Medical records showing treatment for depression, anxiety, PTSD
  • Prescriptions for psychiatric medication
  • Testimony from mental health professionals
  • Documentation of how termination affected your life (relationships, health, daily functioning)

Weak evidence:

  • Testimony that you “felt upset” or “couldn’t sleep”
  • General statements about stress without supporting documentation
  • Claims of emotional harm without treatment

Juries award higher emotional distress damages when supported by medical evidence and expert testimony.

See our guide to Sabine Pilot exception for more information about these claims.

Federal Whistleblower Claims: Varied Damages

Numerous federal whistleblower statutes protect employees who report violations of law. Damage provisions vary by statute.

OSHA Whistleblower Statutes

Many whistleblower laws enforced by OSHA provide:

Compensatory damages:

  • Back pay with interest
  • Reinstatement to former position
  • Restoration of benefits and seniority

Special damages (varies by statute):

  • Some statutes allow compensatory damages for emotional distress
  • Some allow punitive damages
  • Some allow double back pay

Attorney fees and costs:

  • Typically awarded to prevailing employees

Example – Sarbanes-Oxley Act (public company fraud whistleblowers):

  • Back pay with interest
  • Reinstatement
  • Special damages (litigation costs, expert witness fees)
  • Attorney fees
  • No punitive damages or emotional distress damages under SOX

False Claims Act (Qui Tam)

The False Claims Act allows whistleblowers to sue on behalf of the government for fraud against federal programs.

Whistleblower rewards:

  • 15-30% of government’s recovery if government intervenes
  • 25-30% of recovery if whistleblower proceeds alone
  • Can result in millions of dollars in successful cases

Anti-retaliation damages:

  • Double back pay (twice lost wages)
  • Reinstatement
  • Compensation for emotional distress
  • Attorney fees and costs

False Claims Act cases are complex and highly specialized. If you reported fraud against the government and were fired, consult a qui tam attorney.

See our guide to Texas Workplace Retaliation for comprehensive information on whistleblower protections.

Family and Medical Leave Act (FMLA) Damages

FMLA prohibits employers from retaliating against employees who take protected leave.

Available Damages

Lost wages and benefits:

  • Back pay from termination to judgment
  • Value of lost benefits
  • Interest on lost wages

Liquidated damages:

  • Double back pay (equal to lost wages)
  • Awarded unless employer proves good faith and reasonable belief its conduct was lawful
  • Effectively triples recovery in most cases

Reinstatement: Court can order you be given your job back

Attorney fees and costs: Awarded to prevailing employees

Example:

  • Back pay: $60,000
  • Lost benefits: $10,000
  • Liquidated damages: $70,000 (doubles wages + benefits)
  • Attorney fees: $40,000
  • Total: $180,000

FMLA liquidated damages make these cases potentially lucrative relative to lost wages.

Learn more in our guide to Texas Leave Laws.

Fair Labor Standards Act (FLSA) Retaliation Damages

FLSA prohibits retaliation for reporting wage and hour violations.

Available Damages

Back pay:

  • Lost wages from termination to judgment

Liquidated damages:

  • Equal to back pay (doubles recovery)
  • Awarded unless employer shows good faith

Reinstatement: Possible

Attorney fees and costs: Awarded to prevailing employees

See our guide to Texas Wages and Hours.

Workers’ Compensation Retaliation Damages

Texas law prohibits firing employees for filing workers’ compensation claims.

Available Damages

Under Texas Labor Code, successful claimants can recover:

Lost wages:

  • Back pay from termination until resolution

Compensatory damages:

  • May include emotional distress (consult attorney about caps)

Punitive damages:

  • Available in some circumstances

Reinstatement: May be ordered

Attorney fees: May be available

Texas workers’ comp retaliation cases are governed by specific statutory provisions. Consult an attorney about available damages.

How Courts Calculate Back Pay

Back pay is the wages you lost from termination until judgment or new employment. Calculating back pay involves:

Components of Back Pay

  1. Base salary or hourly wages: What you would have earned if not terminated
  2. Overtime: If you regularly worked overtime
  3. Bonuses and commissions: If you had a history of earning these
  4. Benefits: Health insurance, retirement contributions, stock options
  5. Raises: Salary increases you would have received

Mitigation Requirement

You have a duty to mitigate damages by seeking comparable employment. Courts reduce your back pay by:

  • Wages you actually earned at new jobs
  • Wages you could have earned with reasonable effort

Reasonable effort means:

  • Actively searching for work in your field
  • Applying to positions matching your qualifications
  • Accepting comparable employment when offered

Courts do not require you to:

  • Take jobs significantly below your qualifications or pay
  • Relocate to distant cities
  • Accept part-time work when you were full-time

Example:

  • Your previous salary: $80,000/year
  • Months unemployed: 12 months = $80,000 lost
  • New job salary: $60,000/year
  • Months at new job before judgment: 6 months = $30,000 earned
  • Back pay calculation: $80,000 – $30,000 = $50,000
  • If you would have earned $40,000 at old job in 6 months but only earned $30,000, back pay includes the $10,000 difference

Interest on Back Pay

Federal employment law provides for interest on back pay to account for delay in payment. This can add substantial value over multi-year cases.

How Courts Calculate Front Pay

Front pay compensates for future lost earnings when reinstatement is not feasible. Courts consider:

Factors Affecting Front Pay

  1. Your age and career stage: Younger workers with longer careers may receive more
  2. Likelihood of finding comparable work: Specialized skills may take longer to replace
  3. Economic conditions: Job market for your field
  4. Duration: How long until you’re likely to find comparable employment
  5. Past earning history: Promotions, raises, career trajectory

Example:

  • Age 45, regional sales manager, $90,000/year
  • Unlikely to find comparable position for 2-3 years due to specialized industry
  • Front pay: 3 years × $90,000 = $270,000

Front pay is speculative by nature. Courts are cautious about awarding large amounts. Strong expert testimony (labor economists, vocational experts) strengthens front pay claims.

When Front Pay Is Awarded

Courts award front pay when:

  • Reinstatement is not feasible (hostility, position eliminated, relationship too damaged)
  • You need time to find comparable work
  • Damages would otherwise be inadequate

Courts do not award front pay when:

  • You’ve already found comparable employment
  • Reinstatement is ordered
  • You’re near retirement and would not have worked much longer

How Compensatory Damages Are Calculated

Compensatory damages (emotional distress) are inherently subjective. Juries consider:

Factors Affecting Compensatory Damages

Severity of emotional harm:

  • Diagnosed mental health conditions (depression, anxiety, PTSD)
  • Severity and duration of symptoms
  • Impact on daily life and relationships
  • Need for medical treatment or medication

Documentation:

  • Medical records from psychologists or psychiatrists
  • Prescription history for psychiatric medications
  • Treatment notes showing frequency and duration
  • Expert testimony from mental health professionals

Employer’s conduct:

  • How egregious was the discrimination or retaliation?
  • Public humiliation or private termination?
  • Pattern of abuse or single incident?

Your credibility:

  • Consistency of testimony
  • Corroboration by witnesses or records
  • Whether you exaggerate or are truthful

Typical Compensatory Damage Awards

Award amounts vary dramatically, but these ranges are common:

Minimal claims ($5,000-$25,000):

  • Testified feeling “upset” and “stressed”
  • No medical treatment
  • Limited documentation
  • Case primarily about financial loss

Moderate claims ($25,000-$100,000):

  • Some medical treatment (therapy sessions)
  • Documented anxiety or depression
  • Credible testimony about impact on life
  • Supporting evidence

Substantial claims ($100,000-$300,000):

  • Significant medical treatment (long-term therapy, medication)
  • Diagnosed mental health conditions
  • Expert testimony from treating professionals
  • Severe impact on life, relationships, health
  • Approaching or reaching statutory caps

Remember: Title VII caps these at $50K-$300K depending on employer size. Sabine Pilot claims have no statutory cap but require strong proof.

When Punitive Damages Are Awarded

Punitive damages punish employers and deter future misconduct. They are rare and require high standards of proof.

Requirements for Punitive Damages

You must prove the employer acted with:

  • Malice: Intentional desire to harm you
  • Reckless indifference: Knew discrimination was occurring and consciously disregarded it

Examples of conduct supporting punitive damages:

  • CEO or senior executive personally directed discriminatory termination
  • Pattern of discrimination against multiple employees with no corrective action
  • Employer ignored clear evidence of discrimination
  • Retaliatory termination immediately after EEOC charge with no investigation

Examples that do NOT support punitive damages:

  • Single manager’s discriminatory decision unknown to senior leadership
  • Employer made good faith effort to investigate and respond
  • Discrimination was subtle or disputable
  • Employer had anti-discrimination policies and training

Caps on Punitive Damages

Title VII / ADA: Combined cap with compensatory damages ($50K-$300K based on employer size)

ADEA: No punitive damages available at all

Sabine Pilot: No statutory cap, but constitutional limits apply (generally 9:1 ratio or less)

FMLA / FLSA: No punitive damages, but liquidated damages serve similar purpose

Attorney Fees in Employment Cases

Many employment statutes allow prevailing employees to recover attorney fees from employers. This significantly increases case value.

When Attorney Fees Are Awarded

Federal discrimination laws (Title VII, ADA, ADEA):

  • Prevailing plaintiffs typically recover attorney fees
  • Calculated based on reasonable hourly rate × hours worked
  • Can exceed your damage award in some cases

Whistleblower statutes: Most provide for attorney fees

FMLA / FLSA: Attorney fees for prevailing employees

Sabine Pilot: Attorney fees may be available but not automatic

Why Attorney Fees Matter

Attorney fees can transform small-damages cases into worthwhile litigation.

Example:

  • Back pay recovered: $40,000
  • Compensatory damages (capped): $50,000
  • Total damages: $90,000
  • Attorney fees: $120,000 (300 hours × $400/hour)
  • Total employer pays: $210,000

Employers must pay your attorney fees even if they exceed your damages. This creates leverage in settlement negotiations.

Texas vs. California and New York: Damage Comparison

Texas wrongful termination damages are significantly more limited than worker-friendly states:

Damage Type Texas California New York
Title VII compensatory damages Capped $50K-$300K Capped $50K-$300K (federal) Capped $50K-$300K (federal)
State discrimination law damages Mirrors federal caps UNLIMITED under FEHA UNLIMITED under NYSHRL
Punitive damages for discrimination Capped (combined with compensatory) UNLIMITED under state law UNLIMITED under state law
Emotional distress proof required Yes (medical evidence strengthens) Yes but broader recovery Yes but broader recovery
Public policy wrongful termination Sabine Pilot (no cap) Multiple theories (no caps) Multiple theories (no caps)
Practical result Federal caps limit most cases Much higher damage potential Higher damage potential than TX

California and New York workers can recover unlimited damages for discrimination under state law, while Texas caps these at $300,000 maximum. This is why Texas wrongful termination cases typically settle for less than comparable cases in worker-friendly states.

Factors That Reduce Your Damages

Several factors can decrease your recovery:

Failure to Mitigate

If you did not reasonably seek new employment, courts reduce back pay by what you could have earned.

Interim Earnings

Wages from new jobs reduce back pay dollar-for-dollar.

Lack of Documentation

Emotional distress claims without medical evidence receive minimal awards.

Employer’s Good Faith

Some statutes deny liquidated or punitive damages if employer acted in good faith.

Comparative Fault

If you contributed to your termination (e.g., some performance issues were legitimate), damages may be reduced.

Tax Consequences

Employment settlements are typically taxable as wages. Back pay is subject to employment taxes. Emotional distress damages may be taxable. Consult a tax professional about settlement tax treatment.

Settlement vs. Trial: Damage Considerations

Most wrongful termination cases settle before trial. Settlement amounts are typically:

Lower than potential trial verdict:

  • You accept less to avoid litigation risk
  • You get money sooner (no years of appeals)
  • You avoid trial stress and uncertainty

Higher than minimum damages:

  • Employers pay more than clear liability to avoid trial cost and risk
  • Attorney fees liability motivates settlement

Typical settlement ranges:

  • Small cases (clear liability, low damages): $25,000-$75,000
  • Moderate cases (disputed facts, medium damages): $75,000-$200,000
  • Strong cases (clear liability, high damages, large employer): $200,000-$500,000+

These are rough estimates. Each case depends on facts, law, employer size, and litigation costs.

What to Do If You’re Considering a Claim

If you believe you were wrongfully terminated and are evaluating whether to pursue legal action:

1. Calculate your potential economic damages:

  • How much income have you lost?
  • How long until you find comparable work?
  • What benefits did you lose?

2. Assess non-economic damages:

  • Have you sought medical treatment for emotional distress?
  • How severely has termination affected your life?
  • Do you have documentation?

3. Research applicable law:

  • Which statutes apply to your situation?
  • What damages are available?
  • What caps apply?

4. Consult an employment attorney:

  • Most offer free consultations
  • Attorney can evaluate realistic recovery
  • Consider whether potential recovery justifies litigation costs and stress

5. Consider settlement leverage:

  • Does employer face attorney fee liability?
  • Are facts strongly in your favor?
  • Does employer have motivation to settle quickly?

6. Set realistic expectations:

  • Texas damage caps limit recovery in most cases
  • Emotional distress damages require strong proof
  • Litigation is expensive, stressful, and uncertain

See our guides to Texas Wrongful Termination and wrongful termination statute of limitations for more information.

Common Questions About Wrongful Termination Damages

How much is my wrongful termination case worth?

It depends on: (1) which law applies, (2) your lost wages, (3) emotional distress with supporting evidence, (4) employer size (affects caps), and (5) strength of your case. Most Texas cases settle for $25,000-$200,000. Strong cases against large employers can exceed $500,000.

Can I get millions of dollars like California cases?

Unlikely. Texas caps compensatory and punitive damages at $300,000 maximum for Title VII/ADA claims (the most common). Even Sabine Pilot claims rarely reach seven figures. California allows unlimited damages under state law.

What if I have no medical records for emotional distress?

You can still recover emotional distress damages, but expect minimal awards ($5,000-$25,000). Medical documentation significantly increases recovery.

Does employer size matter?

Yes. Title VII/ADA caps range from $50,000 (15-100 employees) to $300,000 (500+ employees). Larger employers face higher potential damages.

Can I get my job back?

Courts can order reinstatement, but it’s rare. Most plaintiffs don’t want to return to employers who discriminated against them. Courts typically award front pay instead.

Are settlements taxable?

Generally yes. Back pay is taxed as wages. Emotional distress damages may be taxable. Attorney fees are complicated. Consult a tax professional.

What if I signed a severance agreement?

If you signed a release waiving claims, you typically cannot sue even if you were wrongfully terminated. This is why you should consult an attorney BEFORE signing severance agreements.

How long does it take to get paid?

If you settle: Typically 30-60 days after agreement.
If you go to trial: 2-4 years (including appeals) from filing to final payment.

Can I get punitive damages?

Rarely. You must prove employer acted with malice or reckless indifference. These are capped at $50K-$300K combined with compensatory damages under Title VII/ADA.

What if I partly caused my termination?

If you had legitimate performance issues, damages may be reduced. However, if termination was motivated by discrimination, you can still recover even if you weren’t a perfect employee.

Understanding Your Realistic Recovery

Texas wrongful termination damages are capped in most cases at $300,000 for non-economic harm (emotional distress and punitive damages combined). Lost wages have no cap but depend on your salary and time unemployed.

Successful cases typically require:

  • Clear violation of federal or state law
  • Strong evidence of employer’s intent or recklessness
  • Significant economic losses or well-documented emotional harm
  • Employer large enough to justify litigation costs

Before pursuing legal action, consult an employment attorney to get a realistic assessment of potential recovery given your specific facts and applicable law. Many wrongful termination situations do not provide sufficient damages to justify the cost and stress of litigation.

References

Disclaimer: The information provided on this page is for general informational purposes only and does not constitute legal advice. Employment laws and damage calculations are complex and fact-specific. The damages discussed are general guidelines and may not apply to your situation. For advice specific to your case, please consult with a licensed employment attorney in your state. Employment Law Aid is not a law firm and does not provide legal representation.