[author: Adam Freed] The California Supreme Court issued its decision yesterday in Kirby v. Immoos Fire Protection, Inc., S185827, 2012 Cal. LEXIS 3981 (April 30, 2012) (available here), holding that attorney’s fees may not be awarded under Cal. Lab. Code § 218.5 to a party that prevails on a claim for meal and rest break violations. Section 218.5 provides that attorney’s fees are to be awarded to the prevailing party "[i]n any action brought for the nonpayment of wages. . . ."

At trial, plaintiff only succeeded on her Equal Pay Act claim and was awarded $26,300. As the prevailing party under the Equal Pay Act claim, plaintiff filed a motion for attorney’s fees seeking $280,432, based on a $140,216 loadstar with a multiplier of two.Defendant also sought fees and cost in the amount of $36,982 pursuant to California Labor Code section 218.5. Section 218.5 awards fees and costs to the prevailing party of a wage claim.

The plaintiffs settled the case with other parties and ultimately dismissed the claim with prejudice against the company. The company subsequently sought an attorney’s fee award under California Labor Code Section 218.5. The trial court awarded attorney’s fees to the company, and the Court of Appeal affirmed.

Minimum Wage Increased to $10.00 Per Hour By 2016 The minimum wage will increase in California from $8.00 to $9.00 per hour on July 1, 2014 and to $10.00 per hour on January 1, 2016 (AB 10).Employer Recovery of Attorney’s FeesIs Further Restricted California has amended Cal. Lab. Code § 218.5 to limit the circumstances under which an employer may recover its attorney’s fees and costs as the prevailing party in a lawsuit in which an employee has sued for nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions (SB 462). Prior to enactment of Senate Bill 462, the prevailing party (either the employer or the employee) could seek recovery of his, her or its attorney’s fees and costs.

On September 12, 2022, the California Court of Appeal held that employees bringing successful rest break and meal period claims are entitled to recover attorneys’ fees under California Labor Code section 218.5. The decision reversed a prior denial of attorneys’ fees by the appellate court following the Supreme Court of California’s May 2022 decision in Naranjo v. Spectrum Security Services, Inc.In the case, Betancourt v. OS Restaurant Services, LLC, a former employee of a Los Angeles restaurant settled claims for rest break and meal period violations under California Labor Code section 226 and for penalties for waiting time and wage statement violations under section 203 based on the meal and rest break claims.As part of the settlement, the restaurant owners agreed to pay the employee $15,375. The employee dismissed other claims for retaliation and wrongful termination but was allowed to file a motion for attorneys’ fees. The trial court awarded more than $280,000 in attorneys’ fees under section 218.5, which mandates that reasonable attorneys’ fees be awarded to an employee who prevails on claims for the nonpayment of wages, so long as the employee requests attorneys’ fees from the start.I

Court’s Decision: The California Court of Appeal reversed. The court first noted that under the California Supreme Court’s decision in Kirby v. Immoos Fire Protection, Inc., 53 Cal. 4th 1244 (2012), Plaintiff could not obtain attorney’s fees based directly on her claims for non-provision of meal or rest breaks because such an action is not brought for “nonpayment of wages” within the meaning of California Labor Code section 218.5. The court of appeal then held that, by extension, Plaintiff similarly could not recover penalties or attorney’s fees for derivative waiting time and wage statement violations based on the same claims of non-provision of meal or rest periods.

A prevailing plaintiff can recover attorneys’ fees in “any action brought for the nonpayment of wages.” Cal. Labor Code § 218.5(a). Waiting time penalties of up to 30 days’ wages are available if the employer “willfully” fails to pay “any wages” due to a terminated employee.

Specifically, and while not exhaustive of the individuals excluded, the new law does not apply to any of the following: workers who are relatives of the employer (grandparent, parent, spouse, sibling, child, or adopted child), any person who performs services through the In-Home Supportive Services program, and any person under 18 years of age who is employed as a babysitter for a minor child of the domestic work employer in the employer’s home. However, if a person who performs babysitting services on an irregular and intermittent basis and does a significant amount of work other than supervising, feeding, and dressing a child, then the overtime exemption shall not apply and the person shall be considered a domestic work employee entitled to overtime.Limit on Prevailing Right to Attorneys’ Fees by an Employer in Wage and Hour Lawsuits In wage and hour lawsuits, California Labor Code Section 218.5 previously granted prevailing employers the right to recover attorneys’ fees where a statute or an agreement allowed for recovery. Under the newamendment, prevailing employers can recover their attorneys’ fees and costs only if they can prove that the employee brought the wage law action in “bad faith,” a clearly heightened standard that arguably significantly diminishes the ability of employers to recovery attorneys’ fees even when prevailing on such claims.California Labor Commissioner Now Has Expanded Authority to Award Liquidated Damages for Minimum Wage Violations An employer who fails to pay an employee the required minimum wage is now subject to civil penalties and restitution, as well as liquidated damages to the affected employee.

Existing law, with certain exceptions, requires a court in any action brought for the nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions, to award reasonable attorneys' fees and costs to the prevailing party if any party to the action requests attorney's fees and costs at the time action is initiated. Senate Bill 462 amends California Labor Code §218.5 to make the award of attorneys' fees and costs where the prevailing party is not an employee contingent on a finding by the court that the employee brought the court action in bad faith. The law does not apply to actions brought by the California Labor Commissioner.

ed from a trial court order granting summary judgment against them. The Court of Appeal affirmed summary judgment on the ground that the employee was not entitled to receive reporting time pay for attending meetings at work because all of the meetings in question were scheduled in advance, and the employee worked at least half of the scheduled time. The Court also held that another employee was not owed additional compensation for working split shifts because on each occasion a split shift was worked, the employee earned more than the minimum amount of pay required by the applicable wage order. In an earlier opinion, the Court of Appeal had reversed the trial court's award to AirTouch of its attorney's fees. However, in this opinion (and after consideration of the California Supreme Court's intervening opinion in Kirby v. Immoos Fire Protection, Inc., 53 Cal. 4th 1244 (2012)), the Court determined that because a reporting time claim is brought to recover unpaid wages, it is subject to Cal. Labor Code § 218.5, which allows a prevailing defendant to recover its attorney's fees.Employer Permitted To Proceed With Defense Of Class Action Based On "Rounding" PolicySee's Candy Shops, Inc. v. Superior Court, 2012 WL 5305729 (Cal. Ct. App. 2012) Pamela Silva sued her former employer, See's Candy, for various wage-and-hour violations. After certifying a class of current and former California employees, the trial court granted Silva's motion for summary adjudication on four of See's Candy's affirmative defenses. In a writ petition to the Court of Appeal, See's Candy challenged the dismissal of two of its affirmative defenses involving its policy of rounding employees' time up or down to the nearest tenth of an hour. Although the Court of Appeal initially summarily denied the writ petition, the California Supreme Court granted the petition and ordered the appellate court to vacate its prior order and to issue an order to show cause in the matter. In this opinion, the Court ordered the trial court to