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Court Costs: Who Pays Them?

Many clients are initially very concerned that they might have to pay the employer’s attorney’s fees or court costs if they lose.  This worry hinders them from consulting with a lawyer and makes them afraid to speak up to protect their rights. However, there are many protections against this negligible risk written into the law.

Up until recently, the employer could recover court costs against a losing employee in a discrimination or harassment case .  Court costs, which are distinguishable from attorney’s fees, include things like filing fees, deposition transcript costs, messenger fees, photocopies, etc.

Also, until recently, employees who sued for unpaid wages could be held liable for the attorney’s fees if they lost, whether the action was frivolous or not.

The laws have changed recently to protect employees against these risks.  The State Legislature recently amended The Labor Code to provide that employees who lose their claims for unpaid wages are not liable for the employer’s attorney’s fees or costs.

And, more recently, the California Supreme Court limited the employer’s ability to recovery attorney’s fees in discrimination and harassment cases.

The California Supreme Court recently held in Williams v. Chino Valley Independent Fires District, (No. S213100, en banc, filed 5/4/15) (Williams), that a prevailing employer may not recover costs in an action under the California Fair Employment and Housing Act (“FEHA”) from an unsuccessful plaintiff unless the court finds the plaintiff’s action was frivolous, unreasonable, or groundless.

The Court reasoned that the particular language of FEHA made it clear that the legislature intended to give the court discretion on whether or not to award costs against the employee.  Therefore, an award of costs should not be automatic, but should be based on a finding of frivolousness, per the Court.

So, if you have a case for discrimination or harassment, don’t let it slip by because you are worried about your former employer coming after you for court costs.  As long as your case has some merit, there is little chance of you having to shoulder this burden.