Sometimes, employers settle an employee lawsuit and expect that to be the end of the matter. But unless the settlement includes an agreement not to apply for any new job openings, the former employee may do just that. And if he’s not hired, he may allege retaliation for prior litigation.
To protect against this, make sure no one involved in the new hiring process played any part whatsoever in the previous lawsuit.
Recent case: Edward was fired from his job as director of the St. Paul Office of Affirmative Action. He sued, alleging whistle-blower protection. The case was settled, and neither party admitted wrongdoing.
Later, Edward applied for a newly created position with the city. The selection committee included a woman who had been involved in the earlier whistle-blowing litigation. She recused herself from the initial selection process. Edward was one of three finalists. When the first two turned down offers, the city sought additional candidates. Edward was again a finalist, but another candidate was hired.
Edward sued, alleging he hadn’t been hired because of past litigation.
The court rejected his claim, reasoning that those involved directly in the prior claim didn’t participate in the latest decision. Given that there was no other evidence pointing to retaliation, he had no case. (McDonald v. City of St. Paul, et al., No. 11-2264, 8th Cir., 2012)
Final note: Include a “no new applications” clause in settlements with former employees.