Opinion ID: 747799
Heading Depth: 2
Heading Rank: 2

Heading: Tax Enhancement Damages

Text: 18 The district court awarded Arneson additional monies to compensate Arneson for the adverse tax consequences from receiving back pay in two payments (tax enhancement award). The SSA argues that tax enhancement awards are not available under Title VII and that, if available, Congress has not waived sovereign immunity from these awards. 19 If the tax enhancement remedy is available under Title VII, we find it analogous to the prejudgment interest remedy, see Manko v. United States, 830 F.2d 831, 836 (8th Cir.1987), as an element of making persons whole for discrimination injuries. See Loeffler, 486 U.S. at 558, 108 S.Ct. at 1971. Therefore, we treat the tax enhancement remedy like the prejudgment interest remedy and hold that Congress must expressly and unequivocally waive sovereign immunity before a party can recover a tax enhancement award from the federal government. 20 We do not believe that Congress has authorized the tax enhancement remedy against the federal government. Nowhere within the statutory framework of the Rehabilitation Act or Title VII, has Congress expressly waived sovereign immunity from tax enhancement damages. The mere fact that Congress intended that discrimination victims receive a full measure of back pay does not amount to an unequivocal and express waiver of sovereign immunity. We therefore reverse the district court's award of tax enhancement damages. 7