Employment discrimination matters measure the economic gap between where the employee's compensation would have been absent the adverse action and where it actually is, from the date of the action through a reasonable point in the future. The economist builds the back pay and front pay figures from the compensation records, accounts for what the employee has earned or could reasonably have earned in mitigation, and reduces the future component to present value.
In short
The claim consists of back pay from the date of the adverse action to the date of trial or analysis, including base pay, overtime, bonuses, commissions, and raises the employee would have received; lost fringe benefits such as retirement contributions, health insurance, stock awards, and paid leave; front pay from the date of analysis until the employee reaches or would reasonably reach comparable employment; and, in failure-to-promote and pay-disparity claims, the difference between the compensation actually received and the compensation of the position or pay level denied. The drivers are the employer's payroll and personnel records, comparator compensation data, the employee's post-termination earnings, and evidence of the job search.
Back pay is usually the most documented component and the least contested; the disputes concentrate on front pay duration and mitigation. How long it will take the employee to reach comparable compensation, whether the replacement job counts as comparable, and whether the job search was reasonable each change the total substantially. Lost equity, bonus, and pension accruals can exceed base pay losses for senior employees, and the pay-disparity component in an unequal pay claim depends on which comparators are used and over what period.
The economist reconstructs the but-for compensation path from the employee's history and the employer's pay practices, including scheduled raises, bonus patterns, and benefit accruals, and compares it with actual post-action earnings year by year. Mitigation earnings are drawn from the employee's records and, where the search is ongoing, from occupational wage data and unemployment duration data for the local market. Front pay is projected over the period the record supports for reaching comparable employment, and both back pay and front pay are stated with the components separated so the fact finder can adjust any one of them. Future amounts are discounted to present value, and where pre-judgment interest is available the report supplies the schedule counsel needs to compute it.
Stage-by-stage guidance on working with a forensic economist in employment discrimination litigation.
From the employee's actual earnings after the adverse action, documented by pay records and tax returns. Where the employee has not found work, the economist looks at the local wage data for comparable positions and the typical duration of unemployment for similar workers, and states the assumption used. The report shows the loss with and without the offset so counsel can address whether the search was reasonable.
Until the employee reaches, or would reasonably be expected to reach, compensation comparable to the but-for path. That period depends on the employee's occupation, age, the local market, and the evidence about the search. The economist presents the loss at several durations rather than asserting one.
Yes, where the records support them. Equity awards are valued from the plan terms and the vesting schedule the employee would have followed, and pension losses from the plan formula applied to the but-for and actual service and pay. These components are shown separately because they can be large and turn on plan-specific facts.
Yes. The economist compares the employee's compensation with that of the comparators counsel identifies over the relevant period, documents the differences by pay element, and computes the shortfall with interest where applicable. The choice of comparators is counsel's; the economist states the effect of using each set.
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