The Perils of Trying to Win at "All Costs"
Published by James Peters June 29th, 2008 in California Employment Law, DiscriminationSome employees (and some employee-rights attorneys) believe that if they are wrongfully terminated and able to get a new job just days later, they will only be able to recover a few thousand dollars and it would not be "worth it" to pursue a claim, especially if they have to pay an attorney to get it. However, in California victims of employee rights violations can recover their own attorney's fees in most cases, which alone could make pursuing a claim worth the effort for both the client and the lawyer.
A good example of this is Harman v. San Francisco (2007) 158 Cal.App.4th 407. In that case, the jury ruled that the defendant had a policy of "reverse" discrimination against white males, but only awarded the employee $30,300 in compensatory damages, including lost wages, etc. However, the court also awarded Mr. Harman over $1 million in attorney's fees.
The case lasted almost eight years between the trial and appeals, but in the end the employee prevailed. When a client wins and is entitled to attorney's fees, the court evaluates how much time the attorney spent on the case and sets an hourly rate comparable to similar attorneys in the community. Unless the attorney performed substantial, time-consuming tasks for the case which were clearly unnecessary, all of the time will be reimbursed by the defendant.
Although several management-side employment attorneys were outraged by this decision, the employee (and his attorney) should not be penalized for spending the necessary time on the case to win. While our firm does a great deal of litigation and we do not mind "fighting", we start almost every case with a good-faith attempt at exploring informal settlement options with the defendant employer. Both sides should want to do this for the simple fact that once attorney's fees start accumulating, both sides become more adversarial and "invested," so they feel they have to "win".
Most savvy employment defense counsel are aware that where a claim appears to be valid, it is very much in their client's best interest to at least try and resolve the case quickly. This case is a prime example of a situation where the defendant likely could have settled for a fraction of what they ended up paying, yet they instead chose to "fight" and paid the price.
I am not suggesting that employees (or attorneys) should pursue (or refuse to settle) cases solely to rack up substantial attorney's fees, but if a case has merit the employee should not have to wonder if their lawyer's bill will be more than what they actually recover in the case, which is the case is many other parts of the country.
Tags
Attorney's Fees | California Employment Law | Discrimination | Policy : Opinion
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2 Comments DISCLAIMER
James,
From an ethical viewpoint, the simple fact that an employee is skillful and fortunate enough to secure new employment within a short period of being unfairly dismissed should not, in any way, affect his or her right to compensation in relation to the alleged wrongful termination.
Where employees are wrongfully terminated, they should be fully entitled to legal remedies - end of story.
In the example which you provide, Mr. Harman's victory indicates that his claims were legitimate. Neither he nor his legal council can be criticized for making full use of the legal system to pursue their legitimate claims.
In cases where employees have legitimate claims, and employers choose to fight such claims in court, then employers can hardly complain about excessive legal costs.
Cheers
Andrew
Indeed, both employers and employees should treat the disputes as business decisions instead of trying to uphold "justice" as the latter only causes unnecessary delays, and expenses to both parties. If an employer realizes that getting summary judgment is hopeless in light of plaintiff's evidence and witnesses, he should do what he can to protect his client's interests, as prolonging th process will not only expose the employer to greater liability but will significantly increase attorney's fees. And since the employer is likely to have to pay its own attorneys fees as well as the fees of the opposing party, it makes this factor all more significant.
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