"Once and a while, the employer avoids an onerous fee award, and occasionally an employer is awarded fees against the employee."
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LITIGATION UPDATE
Attorney Fee Awards Favor Employers
In employment law cases, attorney fee awards often add insult to injury. On top of large damage awards, courts often award substantial attorney fees to the employee's lawyer. Many labor and employment laws, such as the California Labor Code and the Fair Employment and Housing Act, include attorney fee provisions.
Once and a while, the employer avoids an onerous fee award, and occasionally an employer is awarded fees against the employee. Two recent cases demonstrate these outcomes.
In Harrington v. Payroll Entertainment Services, Inc., an off-duty police officer working on a movie set filed a class action over $44.63 in unpaid wages. (Not a typo-he sued for $44.63!!) His gross pay for one day should have been $803 instead of $758.37. He also alleged similar violations of the Labor Code on behalf of 16 other off-duty officers.
The court refused to certify the class action, so Harrington proceeded on his individual claim alone. Shortly before trial, the employer agreed to settle for $10,500 plus reasonable attorney fees as determined by the court.
Harrington's lawyers envisioned a big payday. They filed a motion for fees, requesting $46,227. They claimed five lawyers and one paralegal spent over a hundred hours chasing the $44.63.
In a reassuring show of judicial sanity, the request for fees was denied. The trial court, and later the appellate court, concluded that the requested fee was unreasonably high. The Labor Code does entitle an aggrieved employee to recover "reasonable" attorney fees if he or she wins the case.
The appellate court put it succinctly: "At the risk of understatement, there is no way on earth this case justified the hours purportedly billed by Harrington's lawyers." The court determined that $500 was a reasonable fee.
In a second case, Villanueva v. City of Colton, the court awarded nearly $40,000 in attorney fees to the employer after judgment was entered in favor of the employer in a FEHA race discrimination case.
Fee awards in favor of a prevailing employer are rare, but FEHA does give the court discretion to make such awards. In this case, the court noted that Villanueva's claim clearly lacked merit. "The lawsuit was unfounded, unreasonable, and frivolous." The court next analyzed whether the plaintiff employee could afford to pay an award. It concluded he could. "Villanueva earned $25 per hour plus benefits, which is 'considerably more ... than the average American.'"
Employers should take heart, but not become overly confident in light of these recent rulings. Employees and their lawyers may think twice about suing. But in most cases, courts remain reluctant to award fees against a losing employee.
More Legal Update articles.
Download entire April Legal Update in PDF format.
This article is intended as a brief overview of the law and are not intended to substitute as legal advice. Any questions or concerns regarding any statute or case law should be addressed to a licensed attorney. Copyright © 2008 by Barker Olmsted & Barnier, APLC. San Diego, California. All rights reserved.
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