Employer that prevailed on reporting time and split shift pay claims filed by its employees is entitled to attorney fees on reporting claim

September 24, 2012

Employer that prevailed on reporting time and split shift pay claims filed by its employees is entitled to attorney fees on reporting claim

Aleman v. Airtouch Cellular, California Courts of Appeal-2nd District, No. B231142, Sept. 20, 2012

    Two Former employees of AirTouch Cellular, Daniel Krofta and Mary Katz, sued Airtouch alleging that it failed to pay them "reporting time pay" and "split shift" compensation for attending mandatory store meetings. The trial court granted AirTouch summary judgement. AirTouch then moved to recover attorney fees under Labor Code Section 218.5, which allows prevailing defendant to recover reasonable fees in action alleging nonpayment of wages. Krfota and Katz conteded that the actions were covered by Section 1194, which provides that only plaintiffs in such actions may recover fees. The trail court awarded AirTouch $146,000 in fees against Krofta and $140,000 in fees against Katz. Later, this court reversed the trail court's attorney fee awards, finding that both claims were subjection to Section 1194. However, the California Supreme Court sent this case back to this court in light of its holding in Kirby v. Immos Fire Protection Inc. 
   Reversed in part. In Kirby, the California Supreme Court noted that Section 1194 applies to claims for unpaid minimum wages over overtime compensation. Thus, to fall under Section 1194, a claim must seek unpaid minimum wages or overtime compensation, as those terms are generally understood. Here, this court reconsidered its original ruling, which held that both claims were subject to Section 1194. In doing so, it explained that the split shift claim is subject to Section 1194, given that the claim seeks to recover unpaid minimum wage compensation. However, it also explained that a reporting time claim is not subject to Section 1194, and is instead subjection to Section 218.5, because it is brought to recover unpaid wages. Given that a prevailing defendant may recover attorney fees Section 218.5, this court ruled that the trial court must distribute the fees incurred by AirTouch in defending the reporting time claim.
Opinion by Justice Boren

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