alt.lawyers

In article ,
Stuart Bronstein wrote:
>sethb@ (Seth) wrote:
>> Stuart Bronstein wrote:
>>>
>>>Less mitigation of damages, of course.
>>
>> Is that so? It almost happened to me.
>>
>> I was offered a job at $80,000 base salary, with guaranteed
>> first-year total pay of $130,000. I didn't take it; I later found
>> out that six months later, the company shut down that department
>> and laid everybody off. If I had taken the job, my impression is
>> that I would have received $90,000 (the layoffs were before the
>> bonus date).
>
>If the total pay for the year was guaranteed at $130,000, that should
>have been the amount they would owe you, irrespective of bonus date.

Right; I was subtracting the $40,000 they'd already have paid.

>> Would that have been reduced by the amount I earned elsewhere in
>> the remaining half year? That would certainly distort my
>> incentives.
>
>If you lost that job and then found another one immediately that had
>the same or higher pay, you really had no damages. So yes, the amount
>you would receive would be reduced by what else you earned during the
>same year as the original contract.
>
>And not only would it be reduced by what you did earn, but also by
>what you reasonably could have earned. You are not allowed to sit on
>the couch and watch soap operas for the rest of the year and just
>collect your pay. You have to go out and look for a replacement job.

The distorted incentives referred to the way I might structure
compensation in a new job: since the pay for the first six months was
irrelevant to me, I'd prefer an arrange with a large bonus after that
time to one with a large base salary.

Seth