California Employees Face Skeptical Courts on Punitive Damages

California’s laws are known for their strong defense of employee rights, but, as two recent appeals court rulings show, that doesn’t mean employees are protected from big cuts to punitive damages awards.

Late last month, an employment case decided in favor of an Allstate Insurance Co. employee saw a punitive damages award of more than $15 million tossed on appeal.

Michael Tilkey, a salesman with more than 30 years of experience, was charged with disorderly conduct in 2015, following a domestic dispute with his then-partner. Allstate fired him based on those charges, reporting to the Financial Industry Regulatory Authority that ...