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The Perils of Trying to Win at ?All Costs?

By James Peters

Some 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.

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Tags

Attorney's Fees | Discrimination | Policy : Opinion

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Full post as published by California Employee Rights Blog on June 29, 2008 (boomark / email).