California Supreme Court Rules No Attorney Fees For Claims for Missed Breaks
The California Supreme Court has issued a very important decision as to whether or not a prevailing party in a rest break case is entitled to recover attorneys’ fees incurred in litigating the case. In a recent case, the defendant employer was the prevailing party on a claim by plaintiffs for alleged missed rest breaks. The employer, as the prevailing party, sought to recover its attorneys’ fees under Labor Code section 218.5, which on its face allows for an award of attorneys’ fees to “the prevailing party” in “any action brought for the nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions.” The trial court awarded attorneys’ fees to the employer on multiple claims, but the court of appeal reversed because each of the Labor Code provisions specifically allow for only one-way fee shifting in favor of a prevailing plaintiff. The court of appeal upheld the award of attorneys’ fees to the employer on the rest break claim, holding that the claim sought additional “wages” and was, therefore, covered by Labor Code section 218.5 and its mutual fee shifting provision. The plaintiffs sought review by the California Supreme Court, arguing that the rest break claim was governed by section 1194’s unilateral fee shifting provision because it was really in the nature of an action for payment of less than the minimum wages required by law.
The Supreme Court rejected the plaintiffs’ argument. As such, the Court held that section 1194 does not provide a mechanism for a prevailing party to recover attorneys’ fees on a rest break claim. Using somewhat strained reasoning, the Court held that a claim for missed rest breaks is not a claim for “nonpayment of wages” within the meaning of 218.5 (even though the Supreme Court recently held that the premium pay owed for missed breaks is a “wage” and not a “penalty”). Nor is a claim for missed rest breaks a claim for nonpayment of fringe benefits or health and welfare contributions. Instead, according to the Court, a claim for missed breaks is a claim for denial of a mandated break and, as such, is not covered by the express language of section 218.5 and 1194 of the Labor Code does not provide a mechanism for a prevailing party to recover attorneys’ fees on a claim for missed breaks.
The Supreme Court’s decision is a good one for California employers because the decision precludes prevailing plaintiffs from recovering attorneys’ fees in connection with meal and rest break claims. This should operate to drive down the incentive for the plaintiffs’ attorneys to file so many actions against employers for rest and meal breaks.
