[dogma1138]

The downside is that lawsuits are public in most places which might come up as a negative for future job prospects.

Companies would be weary of hiring people that sued previous employers and not for no reason no one can ever know the facts first hand and even borderline frivolous law suits tend to be settled, so having the choice between someone who sued a previous employer and someone who hasn’t most companies would opt out for the latter.

[ianai]

That's valid, but probably has limits (i.e. if you leave town). I imagine certain factors mitigate the negatives. For one, some industries are known to be harsh to employees. I imagine the same factors that allow for such harshness may also allow for legalistic backgrounds.