• New Law Limits Attorneys’ Fees in Wage and Hour Cases

    In many, if not most, wage and hour cases (e.g., unpaid overtime, minimum wage, commissions, bonuses, etc.), the employer can pay more in attorneys’ fees than what is allegedly owed in unpaid wages.  Under the “American System,” each side bears the cost of their own attorneys unless the contract or statute under which the lawsuit proceeds provides for recovery of attorneys’ fees.  In the employment law field, some statutes allow the prevailing party to recover their attorneys fees.  Other statutes only allow the prevailing employee to recover attorneys’ fees.

    The legislature uses one-sided attorneys’ fee provisions (i.e., only the employe can recover attorneys’ fees) to make it easier for employees to hire attorneys because the employee typically has less money than the employer, and the employee will need to hire an attorney on a contingency-fee basis.  By allowing the employee to recover attorneys’ fees, an attorney may be willing to handle “lower value” cases knowing she or he will recover her or his attorneys’ fees at the end of the litigation.  This creates an incentive for attorneys to take cases that are otherwise not economically feasible to prosecute.

    In an unpaid wage claim there are two different statutes that apply depending on whether the claim is for overtime/minimum or wages other than overtime/minimum wage.  Under Labor Code section 1194.2, in any claim for the recovery of unpaid minimum wage or overtime, only the employee can recover his/her attorneys’ fees.  The employer cannot recover its attorneys’ fees even if it proves it paid the employee correctly.

    Under Labor Code section 218.5, in any other claim for wages or benefits not covered by Labor Code section 1194.2 (e.g., non-overtime/minimum wage claims), the prevailing party is entitled to attorneys’ fees.  This means that if an employee sues the employer for unpaid commissions or bonuses and loses, the employee is responsible for the employer’s attorneys’ fees.

    Thanks to a new law signed by Governor Brown, the employer will soon be able to recover its attorneys’ fees under Labor Code section 218.5 “only if the court finds that the employee brought the court action in bad faith.”  Proving “bad faith” is a very high standard.

    There is no exigency clause, so the amendment will take effect January 1, 2014.

    If you have a question about payroll practices, contact an attorney familiar with California’s wage and hour laws.

    The Law Office of Phillip J. Griego
    95 South Market Street, Suite 520
    San Jose, CA 95113
    Tel. 408-293-6341
     
    Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
     
    Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.
     
    Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

    San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.

  • California Expands What Constitutes Sexual Harassment

    In 2011, a California appellate court decided that a series of extremely egregious comments and conduct by male co-workers against another male co-worker did not constitute sexual harassment because the harassment was not motivated by sexual desire.  If the perpetrators and the victim were not of the same sex, I suspect the court would have had no trouble finding the behavior constituted unlawful sexual harassment.

    The case, Kelley v. The Conoco Companies, was viewed as an aberration.  Even die-hard defense lawyers condemned the decision as an anomaly.  The perpetrators used vulgar, sexually-explicit comments and physically demeaning behavior to force the worker out of his job.  Since the court determined that sexual harassment had to be motivated by sexual desire, the employee was left without a remedy under the law, because the law does not provide a general civility code.

    Yesterday, Governor Brown signed SB 292, sponsored by the California Employment Lawyers Association, to override the Kelley decision.  SB 292 amends California’s Fair Employment and Housing Act to specifically state that “Sexually harassing conduct need not be motivated by sexual desire.”  Signing the bill limits the chances that future conduct similar to the facts in Kelley will fall short of the “sexual harassment” hurdle.

    Although I am generally not a fan of more laws, this concise and direct addition will prove useful to plaintiff’s lawyers in sexual harassment claims.  The employee no longer has to prove that the inappropriate conduct was motivated by the aggressor’s desire to have sexual or intimate relations with the victim.

    Most responsible employers take appropriate measures to educate employees regarding what is and is not acceptable behavior in the workplace.  With this broader definition, employers should consider revising their employee handbooks and modify their annual sexual harassment prevention training.  (You are conducting annual or at least semi-annual sexual harassment prevention training, right?)

    Employers and employees with questions about how this new law will impact their work environment should contact an experienced employment attorney familiar with the ever-changing landscape in sexual harassment law.

    The Law Office of Phillip J. Griego
    95 South Market Street, Suite 520
    San Jose, CA 95113
    Tel. 408-293-6341
     
    Original article by Robert E. Nuddleman, former associate of The Law Office of Phillip J. Griego.
     
    Feel free to suggest topics for the blog. We are happy to consider topics pertaining to general points of Labor and Employment Law, but we cannot answer questions about specific situations or provide legal advice. If you desire legal advice, you should contact an attorney.
     
    Your use of this blog does not create an attorney-client relationship between you and the Law Office of Phillip J. Griego. The use of the Internet or this blog for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be posted in this blog and the Law Office of Phillip J. Griego cannot guarantee the confidentiality of anything posted to this blog.Phillip J. Griego represents employees and businesses throughout Silicon Valley and the greater San Francisco Bay Area including Palo Alto, Menlo Park, Mountain View, Los Altos, San Jose, the South Bay Area, Campbell, Los Gatos, Cupertino, Morgan Hill, Gilroy, Sunnyvale, Santa Cruz, Saratoga, and Alameda, San Mateo, Santa Clara, San Benito, Mendocino, and Calaveras counties.