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CA Supreme Court restricts employer's ability to recover fees from employees in discrimination and wrongful termination cases under FEHA

The California Supreme Court ruled today that an employee who loses a case under the California Fair Employment and Housing Act (FEHA) is not liable for the employer's attorney's fees or costs unless the case was frivolous, unreasonable or groundless.

This is an important victory for employees. Most workers are able to fight back against unlawful employment practices, such as discrimination, harassment and retaliation, only because attorneys in this field handle these cases on a contingency fee basis. Attorney's fees and costs in these cases can be very high. Most low wage earners, and even mid to high level employees, could not afford to pay the high cost of attorney's fees. Worse yet, if employees faced the prospect of having to pay the employer's attorney's fees or costs if they lost, many valid cases would not be pursued.

The California Supreme Court highlighted the state's "policy of encouraging vindication of civil rights embodied" in the Fair Employment and Housing Act, Government Code § 12900 et seq. It noted that its ruling is consistent with federal law under the Americans with Disabilities Act and the Federal Civil Rights Act of 1964 (Title VII) - it was "the intent of Congress. . . to encourage persons injured by discrimination to seek judicial relief." The court quoted its earlier decision in the arbitration context as follow:

"[I]f it is possible that the employee will be charged substantial forum costs, it is an insufficient judicial response to hold that he or she may be able to cancel these costs at the end of the process through judicial review. Such a system still poses a significant risk that employees will have to bear large costs to vindicate their statutory right against workplace discrimination, and therefore chills the exercise of that right.

(Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 110.)

The full text of the Supreme Court's opinion can be read here:

Williams v Chino Valley Ind. Fire District.pdf

The following links explain what constitutes a wrongful termination under California law:

Wrongful Termination under California law

Can I Sue My Employer for Wrongful Termination in California?

Los Angeles Wrongful Termination Law Firm

 

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