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Decision in Kirby v. Immoos Fire Protection, Inc.
On April 30, 2012, the California Supreme Court decided whether workers can recover or be subject to awards of attorneys fees when making meal and rest period claims.
The Court in Kirby v. Immoos Fire Protection, Inc. held that, generally, claims alleging meal and rest period violations under Labor Code section 226.7 are not subject to one-way or two-way fee shifting provisions. “In line with its analysis in Brinker, the Court’s decision in Kirby protects low-wage workers’ rights to pursue section 226.7 meal and rest break claims without fear of exposure to exorbitant amount of attorney’s fees,” said Fernando Flores, Director of Legal Aid Society–Employment Law Center’s WageHELP Program.
The key statutes in contention were Labor Code section 1194 (which only allows workers to recover attorney’s fees) and Labor Code section 218.5 (which allows either party to recover attorney’s fees). The Court ruled that the legislature did not intend either of these attorney’s fees provisions apply to section 226.7 claims and as result “the default American rule that each side must cover its own attorney’s fees” will apply.
The Court examined the plain meaning and legislative history of each statute. In terms of section 218.5, the Court emphasized that the legislature gave no indication that the two-way fee shifting provisions in 218.5 apply to meal and rest period claims. It clarified that section 226.7 meal and rest period protections have “long been viewed as part of the remedial worker protection framework,” (citing Murphy v. Kenneth Cole) and that section 226.7 claims are not within the purview of the "nonpayment of wages” language in section 218.5. Of particular importance, the Court noted that “the legislature could reasonably have concluded that meritorious section 226.7 claims may be deterred if workers, especially low-wage workers, had to weigh the value of an ‘additional hour pay’ remedy if their claims succeed against the risk of liability for a significant fee award if their claims fail.” The Court did not decide the question of whether a law suit is shielded from attorney’s fees under section 218.5 by including minimum or overtime wage claims. This issue is likely to be decided in future cases.
In this case, Anthony Kirby and Rick Leech, Jr. (Kirby collectively) were two former employees of Immoos Fire Protection, Inc. (IFP) who sued the company for violations of the Labor Code (including failure to pay overtime, waiting time penalties, payroll violations, rest period violations, and contract claims) and California’s unfair competition law.