A discharged employee must use reasonable diligence to find comparable employment, and back pay is reduced by what they earned or could have earned.
Comparable employment means substantially equivalent in promotional opportunities, compensation, job responsibilities, working conditions and status. An employee need not accept a demotion, a distant relocation, or a demeaning position.
The employer’s burden. To show that comparable positions were available and that the employee failed to use reasonable diligence. Expert testimony from a vocational specialist and evidence of specific openings are the usual proof; a general assertion that jobs existed is not enough.
Self-employment and further education can constitute reasonable mitigation where a good faith effort to establish a business or to improve employability is shown.
Unemployment benefits are generally not deducted, under the collateral source rule, in most jurisdictions.
Offers of reinstatement. An unconditional offer of the same or a comparable position generally cuts off back pay from the date of refusal, whether or not the employee accepts, unless the conditions would be intolerable.
Evidence for employees. Keep a contemporaneous log of applications, recruiters contacted, interviews, and rejections. Reconstructed searches are discounted.