Q. We're being sued for discrimination. What circumstances would open us for punitive damages? —L.C., Massachusetts
A. When Congress amended Title VII of the Civil Rights Act in 1991 to allow employees to claim punitive damages, it made such damages available only when an employer engages in intentional discrimination. That standard became clearer after a 1999 U.S. Supreme Court ruling (Kolstad v. American Dental Association), which said employees must prove that an employer acted with either reckless indifference or actual malice. Courts will look at internal documents, e-mail and statements to make the call.
Punitive damages are awarded to punish employers, so those awards can be huge, but federal law caps punitive damages in Title VII cases at $300,000.