Los Angeles Partner Kate Gold and associate Elena Min recently authored for The Daily Journal an article on changes to Section 218.5 of California’s Labor Code. The change, enacted through Senate Bill 462, curbs an employer’s ability to recover prevailing party attorney fees and costs in a lawsuit seeking unpaid wages, fringe benefits, or health and welfare or pension fund contributions.
Scheduled to go into effect January 1, 2014, the amendment limits recovery of attorney fees and costs by a prevailing employer “only if the court finds that the employee brought the court action in bad faith.”
Kate and Elena said the amendment “strips employers of one possible weapon in their arsenal for deterring nonmeritorious wage and hour claims.”
“Attorneys for plaintiffs and defendants will likely disagree with the consequences of the amendment as well as its premise – that the two-way fee recovery of existing Section 218.5 has had a chilling effect on employees’ wage and hour claims under that section,” they wrote. “But the bottom line is that “bad faith” is a high standard to meet and the amendment makes fee recovery in Section 218.5 actions an uphill battle for employers.”