Duty of Employee to Mitigate Loss

In employment law, a dismissed employee has a proactive legal obligation, known as the duty to mitigate loss, to minimise the financial damage resulting from their dismissal. This duty primarily requires the individual to make genuine, consistent efforts to secure “suitable alternative employment”. 

Key Obligations of the Employee

• Actively Seek Work: It is not enough to simply register with recruitment agencies or post a few applications. The Workplace Relations Commission (WRC) and the Labour Court typically expect claimants to spend a significant portion of each normal working day (Monday to Friday) actively searching for new roles.
• Document All Efforts: Employees must provide documentary evidence of their job search, such as a journal or spreadsheet tracking applications, resumes sent, interviews attended, and responses received. Failure to produce this evidence can lead to a reduction in compensation, even if the dismissal was proven unfair.
• Accept Comparable Roles: While an employee does not have to accept the very first offer or a role that is vastly inferior, they are expected to pursue “comparable” employment with similar status, hours, and pay. As the period of unemployment lengthens, the standard for what is considered a “reasonable” alternative role may broaden. 

Consequences of Failure to Mitigate

• Reduction in Award: If a WRC adjudicator finds that an employee did not make sufficient efforts, they may reduce the financial award. For instance, a claimant’s potential award might be halved or even reduced to zero if they cannot prove genuine attempts to find work.
• Offsetting Earnings: Any income earned from a new job during the “reasonable notice” or compensation period is typically deducted from the total damages owed by the former employer. 

Burden of Proof

• The onus of proof lies with the employer to show that the dismissed employee failed to take reasonable steps to mitigate their loss. Employers often defend claims by providing evidence of available job vacancies in the relevant sector that the claimant failed to apply for. 

Notable Exceptions

• Medical Unfitness: If an employee is medically certified as unfit for work, they are not expected to mitigate during that period, though they may also be unable to claim for loss of earnings for those specific dates. In other words a claimant/employee who is medically unfit for work, then he cannot be said to be adequately unfit to seek work. This is a complicated area. 
• Restrictive Covenants: If a former employer enforces a non-compete clause that prevents the employee from working in their sector, the employee’s ability to mitigate may be limited, which can sometimes lead to a higher award.