This last holding is particularly important to employers. Because strong anti-discrimination policies and effective grievance mechanisms will help shield employers from punitive damage claims, Kolstad creates a strong incentive for employers to develop and vigorously enforce policies against discrimination. Mr. Miller is originally from Charleston. In addition to his employment law practice, Mr. Miller serves in various ministries in his church and actively serves the community through pro bono representation of children and non-profit organizations, including serving as general counsel for the Lowcountry Chapter of the American Red Cross. A recent North Carolina Supreme Court case has carved out an exception to the rule that employers cannot sue employees under North Carolina's generous statute concerning unfair and deceptive trade practices.
Successful plaintiffs can recover treble damages and, in some cases, attorneys' fees.
Traditionally, North Carolina courts have refused to apply this statute to claims arising from employer-employee relationships. The North Carolina Supreme Court found that Chapter 75 applied to this situation because the employee's acts of self-dealing involved business activities between companies owned by the defendant employee and the defendant's employer. The Court stated that the defendant's mere status as an employee did not safeguard him from liability for deceptive business practices aimed at his employer. Thus, Sara Lee gives employers the additional remedy of treble damages against employees who breach their duty of loyalty by engaging in self-dealing transactions through outside business entities. South Carolina has a similar Unfair Trade Practices Act which South Carolina courts also have refused to apply to claims arising from employer-employee relationships.