Employee Tenure and Economic Losses in Wrongful Termination Cases

Charles L. Baum

Journal of Forensic Economics, 2013, vol. 24, issue 1, 41-66

Abstract: When calculating lost earnings in wrongful employment termination cases, economists should approximate the amount of time a terminated employee would have remained employed for the defendant employer accounting for the probabilities of surviving, participating in the labor force, being employed, and remaining employed for that particular employer. I develop a model for the annual probability of remaining with a particular employer using National Longitudinal Survey of Youth data, which tracks the employment experiences of a nationally-representative cohort of individuals over the 1979 through 2010 period. Many employment spells are relatively short, so short tenures are associated with a high probability of leaving an employer. After a point, somewhat longer tenures are associated with a higher probability of remaining with an employer an additional year.

JEL-codes: K13 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:fek:papers:doi:10.5085/jfe.24.1.41

DOI: 10.5085/jfe.24.1.41

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