Liberty Mutual Ordered to Pay $103 Million in Age Discrimination Case After Terminating 30-Year Employee

Imagine working for the same company for over three decades, receiving positive performance reviews year after year, and then suddenly being told you “need improvement” after a new manager takes over. That’s what happened to a former Liberty Mutual case manager, according to a lawsuit that resulted in one of the largest age discrimination verdicts in U.S. history.

In early December, Liberty Mutual Insurance Company was ordered to pay $103 million to a former case manager who claimed the company engaged in age discrimination and harassment. The verdict includes non-economic damages of $20 million and punitive damages of $83 million.

The plaintiff was a Liberty Mutual employee for over 30 years before being terminated in 2016. She filed a lawsuit in Los Angeles County Superior Court in 2017, accusing the company of violating the California Fair Employment and Housing Act (FEHA) by discriminating against her based on age.

According to the complaint, trouble started in 2012 when a new manager came on board. Over the next few years, the lawsuit alleges the office saw a pattern of older employees being pushed out. Workers in their 50s and 60s were allegedly forced to quit, and nearly everyone over 40 either lost their jobs or faced pressure to leave. The filing noted that in an office of roughly 120 workers, just two employees remained who were over age 40.

FEHA protects workers age 40 and older from age discrimination. Under FEHA, employers with five or more employees can’t discriminate against workers based on age in hiring, firing, compensation or terms and conditions of employment. The law also prohibits harassment based on age and retaliation against employees who complain about age discrimination.

The plaintiff said she faced a series of negative employment actions after the new manager arrived. According to the complaint, teamwide issues were blamed on her individual performance. She was ignored in the workplace but singled out in meetings and criticized.

In 2015, she got a “needs improvement” rating on her performance review. This was the first time in more than 30 years that her work had been rated negatively. A sudden shift after a long period of satisfactory reviews is often a red flag in discrimination cases. Months later, she won a customer service award for her work with a major client. At the awards event, her manager allegedly dismissed her achievement, saying she’d simply “got lucky” and that “it would never happen again.”

In 2016, the plaintiff took short-term disability leave for a few months due to a worsening blood pressure condition, which Liberty Mutual approved. Upon returning to work, her building access had been deactivated. She was then called into a meeting and fired immediately, eventually being replaced by a 20-something white male.

The timing of her termination is important under California law. FEHA prohibits employers from retaliating against employees who take medical leave or disability leave. Terminating an employee immediately upon their return from approved leave can suggest retaliatory intent.

At trial, the plaintiff’s attorneys argued that Liberty Mutual launched a fake internal investigation into her work as a pretext for getting rid of senior, higher-paid workers. Often, if there is evidence of a pattern showing that multiple older employees were pushed out, it can strengthen an age discrimination claim.

The $83 million in punitive damages reflects the jury’s finding that Liberty Mutual’s conduct was particularly egregious. Under California law, punitive damages are awarded when a defendant acts with oppression, fraud or malice.

Age discrimination remains a persistent problem in workplaces. Older workers often face stereotypes that they are less adaptable or more expensive to employ. Some employers target older workers for termination, hoping to replace them with younger, lower-paid employees.

Workers who believe they’ve experienced age discrimination should document everything. Keep copies of performance reviews, emails and any communications that might show discriminatory treatment. Note the ages of employees who were terminated and their replacements, if known.

At Erlich Law Firm, we represent workers who have faced age discrimination and other forms of unlawful treatment in the workplace. If you’ve been terminated, demoted or harassed because of your age, our experienced Oakland employment lawyers can help. Contact us today for a free case evaluation to learn more.