November 20, 2002

Common Labor Law Remedies: A Millennium of Retrenchment

11 min


The common law is irrepressible in its ability to develop new remedies to redress inequities. Maryland courts, during the last two decades of the Twentieth Century, demonstrated this ability very well in the employment arena. Across a broad spectrum of issues, our state’s judiciary rendered decisions that recognized new remedies for employees. We are now in a new millennium, however, and I predict a period of retrenchment.

Prior to 1980, most employment law was practiced before federal courts and agencies. The "at will" doctrine, under which employees could be terminated for any or no reason not prohibited by statute, ruled with a vengeance. Then the Court of Appeals decided Adler v. American Standard Corp., 291 Md. 31, 432 A.2d 464 (1981), creating a new tort action for discharges in violation of a clear mandate of public policy. Since Adler, Maryland courts have found more state-based, common law employment rights -- everything from implied "just cause" employment contracts in personnel manuals to a cause of action for intentional interference with the prospective advantage in unemployment compensation benefits. See Ayres & Gavin, The Workplace Tort Explosion, MD BAR JOURNAL, Vol. XXII No. 1 (Jan/Feb. 1989).

As a result of these common law developments, the employment landscape has changed substantially. The specter of multi-million dollar verdicts by Maryland juries is a real risk to employers making personnel decisions. See Ayres & Portner, Insurance Coverage in Labor Cases -- The Lord Giveth and Taketh, MD BAR JOURNAL, Vol. XXVI, No. 2 (March/April 1993).

This is an important development. Even when juries aren’t rendering verdicts, and even when workers are not filing lawsuits, employers are changing the ways they do business to minimize the risk of large verdicts. Moreover, this phenomenon is not limited to Maryland, but has spread to states throughout the country.

The increased importance of Maryland common law in the workplace has come at a price. Employment lawsuits have garnered a larger share of the civil court dockets. For example, while TitleVII and federal sector claims have contributed significantly to this particular statistic, employment cases now comprise more than 20% of new federal civil suits.

As a result, courts have been erecting barriers to common law employment claims. New barriers will continue to be found as we move forward into the new millennium. Some of the more likely ones described below.


For many years extending well into the Twentieth Century, arbitration was disfavored by the judiciary. How things have changed and will continue to change over the coming years. Judges now see arbitration as a tremendous technique to maximize scarce judicial resources, and are only too happy to defer to the arbitral process whenever a dispute arguably falls within the scope of the parties’ arbitration agreement.

Common law tort and contractual claims have long been subject to arbitration. Much of the recent litigation, especially in federal court, has focussed upon statutory claims. At one time, mandatory binding arbitration of statutory employment claims was not the norm, but courts are changing their views on that subject. See Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991). Because of the judiciary’s desire to alleviate the pressure of employment claims upon civil dockets, I predict that, within a few years, arbitration of statutory claims will be even more commonplace and well-accepted by the courts.

An interesting issue concerns the fairness of the arbitral process. Naturally, employers would like one-sided arrangements that stack the deck against workers. As the Fourth Circuit recently emphasized in Hooters of Am., Inc. v. Phillips, 173 F.3d 933 (4th Cir. 1999), courts will not enforce such one-sided arrangements. A fair process, however, will be enforced by judges with more and more regularity.

Another interesting issue involves the scope of judicial review for arbitral decisions involving statutory claims. Arbitration decisions under collective bargaining agreements are extremely difficult to overturn. Should reviewing courts look more closely at arbitral decisions that construe federal statutory law? After all, some would argue, the rights that the parties surrender, for example, under TitleVII are important enough to warrant more serious review than the typical union/management arbitration decision. A number of courts have accepted this analysis notwithstanding the fact that, carried to its extreme, this principle defeats a prime factor in favor of arbitration -- namely, maximizing scarce judicial resources.

Who should pay for these arbitrations? From one standpoint, one might think that splitting the expense between the parties would be the fairest solution. This is how the arbitrations of most commercial disputes are handled, as well as proceedings under many union/management collective bargaining agreements. On the other hand, because of the economic disparities between most workers and their employers, a fee splitting arrangement might not be appropriate. At least one court has accepted this latter rationale, holding that employer must pay the entire cost. See Cole v. Burns Int’l. Security Services, 105 F. 3d 1465 (D.C. Cir. 1997).

What remedies are available in these statutory arbitrations? Again, many employers might prefer to limit awards to back pay and (perhaps) attorneys’ fees. The law is evolving in a different direction, however, and I predict that this evolution will continue into the Twenty-First Century. If an employee is going to be forced to give up the right to a jury trial, for example, fairness would dictate that the arbitrator be empowered to award the full range of statutory relief -- including punitive damages and recovery for pain, suffering and mental anguish. A number of arbitration processes, especially ones that involve federal statutory claims, specifically provide for such broad relief.


With increasing frequency, the parties can and do agree to voluntary mediation of employment disputes, either on an adhoc basis or pursuant to employer-wide systems. Such arrangements are becoming as popular as arbitration, and often operate as a two-step process -- with mediation followed by arbitration if the former is not successful.

Courts and agencies are also requiring mediation with ever-increasing frequency. Often, the case cannot proceed until the parties have exhausted mediation processes under the direction of trained, experienced professionals. Even appellate courts are devoting substantial resources to mediation, prior to briefings and oral arguments, to save judicial resources. Statistics have shown that these mandatory mediation processes work. As these successes become more well-known, more and more courts will undoubtedly utilize this technique.

The types of procedures that mediators can utilize are bounded only by the imagination of the parties. The typical format involves a disinterested third party who hears the positions of the litigants, and then shuttles back and forth to narrow issues and move toward resolution. Other formats can be far more elaborate.

For example, some mediations involve simulated mini-trials, sometimes before a mock jury. Others use focus groups that are patterned as much after Madison Avenue marketing surveys as legal proceedings. The advantages for litigants to these techniques over full-scale litigation primarily revolve around saving time and money, and preserving confidentiality. The advantage to the judicial system is that court dockets are reduced without additional judges spending time on the mediated disputes.

Contractual Waivers Of Jury Trials And Remedies

Sometimes, employers do not like arbitration because of a fear that arbitrators "split the baby" or are too swayed by employee sympathies and emotions. Consequently, some employers turn to contractual waivers, seeking to abrogate either the right to a jury trial or various remedies (such as punitive damages). When enforceable, such waivers can provide employers with the best of both worlds -- a judicial forum, but no risk of runaway jury verdicts. When not enforceable, such contracts may be independently actionable or at least used as evidence against the employer.

The big question is whether courts will enforce these waivers. In some cases, such as company-wide waiver language contained in a personnel manual, enforceability seems suspect. Particularly with federal statutory discrimination claims, the Older Worker Benefits Protection Act ("OWBPA") -- either expressly or by implication -- might well negate the waiver. In other cases, I believe that these waivers are more likely to be upheld.

For example, a highly compensated employee, with a fully negotiated employment contract, very likely could be held to the terms of a waiver. As another example, if someone signed a severance agreement that included a jury trial waiver, as long as the employer complied with the OWBPA, the provision would likely be deemed invalid.

Sometimes, these contractual waivers can be coupled with a forum selection provision and a choice of law clause. For example, the parties could agree to a waiver of a jury trial, that the employee agreed to file any lawsuits in Montgomery County, and that Maryland law would apply. As long as a substantial enough nexus could be demonstrated between the parties or the dispute and the selected forum, such clauses would likely be upheld. In other words, an employer probably could not require that all Maryland workplace claims be heard in Siberia.

Curtailed Discovery

Who can forget the golden age of limitless discovery? Employment litigators of my vintage (or older) remember when interrogatories and document requests -- even without counting the blunderbuss "instructions" -- went on for pages and pages. The parties could note as many depositions as they desired, and some such sessions could last for days or weeks.

As technology advanced, word processing could churn out mountains of motions to compel that the opposing party was forced to address. The courts, too, were required to sift through all these papers and decide the discovery issues that most attorneys were only too happy to raise.

Courts have been fairly responsive in devising methods to curtail the more obvious discovery abuses. Rules have been promulgated to limit the numbers of interrogatories and document requests. Deposition hours are now typically proscribed. Judges and magistrates are only too happy to impose sanctions (including attorneys’ fees) against the losing party, as well as counsel, in a discovery dispute. Published deposition guidelines spell out in great detail what constitutes unacceptable conduct for those who need specific rules to supplement common sense notions of courtesy.

The Twenty-First Century should see even greater activism by courts and legislators to limit the amount of time that judges must devote to the discovery process. Limitations, sanctions, and non-judicial discovery umpires -- coupled with increased use of technology -- will lead the way in this increased activism.

Summary Judgment

For many years, employment claims were regarded as unlikely candidates for summary judgment. Many such claims require a finding of unlawful motive or intent, and hornbook law typically specified that these issues raised genuine issues of material fact.

Over the last ten to fifteen years, many civil procedure hornbooks have had to be modified. Summary judgment has become so popular, particular in Maryland federal courts, that trials of employment cases are relatively rare. Even in state courts, judges are becoming more willing to weed out factually unsupported claims by granting summary judgment. This trend should continue.

Ironically, some courts believe that the summary judgment process takes more time than simply denying summary judgment and proceeding to trial. In simple cases, or in jurisdictions where appellate courts are not receptive to summary judgment, that might be true. In most cases, though, particularly, as the summary judgment vehicle has developed over time, that perception is becoming less and less accurate.

The U.S. Supreme Court has made it abundantly clear that, to defeat summary judgment, the non-moving party must introduce admissible evidence that a reasonable jury could conclude establishes the critical facts upon which the non-moving party bears the burden of proof. Moreover, the trial judge and the reviewing court must view the sufficiency of that evidence through the prism of the applicable burden of proof. For example, to defeat the qualified privilege in a defamation case, the plaintiff must show knowledge of falsity or reckless disregard for the truth by clear and convincing evidence. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986); and Celotex Corp. v. Catrett, 477 U.S. 317 (1986).

These federal principles have been fully embraced by Maryland appellate courts. See Beatty v. Trailmaster Products, Inc., 330 Md. 726, 625 A.2d 1005 (1993). As a result, litigants have a potent weapon to "cut to the chase" in employment cases by filing sharply defined summary judgment motions that focus upon a critical element of the plaintiff’s case. As state court judges become more and more educated to the principles of employment law, they will seize the opportunity, where appropriate, to conserve judicial resources by granting summary judgment in such cases.

Legislative Developments

Over the past few decades, the U.S. Supreme Court and the Maryland General Assembly have been quite proactive in the employment arena. Will this trend continue? Will legislatures -- even at the county or municipality level -- continue to add protected classifications to EEO statutes and ordinances? Will legislation be enacted either to encourage or to require mediation or arbitration? Will statutory "just cause" employment rights be recognized, akin to unemployment or workers’ compensation schemes? Such laws exist in various parts of the world, such as Canada. If enough large verdicts are rendered in the employment arena, even employers could eventually lobby for such laws -- much as occurred in the workers’ compensation field earlier in the Twentieth Century.

Who can tell what will happen with new statutes? Legislation is truly the "joker in the deck" insofar as the subject of common law employment remedies is concerned. There are simply too many variables to predict the impact of statutory developments upon labor law, although there undoubtedly will be such developments. The General Assembly could even sidetrack or outright scuttle the common law retrenchment that I am predicting in this article.


January1, 2010, is the date that I have marked on my calendar to re-read this article. The prediction business is difficult at best. Only two things realistically can be foretold. First, circumstances will change. Second, the common law will adapt to address those changes. How these two self-evident truths will play out in the workplace over the next decade will be interesting to experience. Reviewing my predictions ten years from now will be the only way to tell. I should have become a fortune-teller instead of a lawyer.

The author is a partner at Venable, Baetjer and Howard, LLP, and is currently Chair of the MSBA Labor and Employment Law Section.