discrimination

San Diego Employment Attorney, Contingent Fee FAQs

Mike Ivancie, Esq.

Update as of February 2, 2017, The Ivancie Law Practice is no longer taking any new contingent fee federal discrimination cases. We apologize for any inconvenience. 

Do you have an employment case, but no money to fight it?

Then hiring an attorney on a contingent fee basis is probably the best option for you.

Contingent fee agreements are used in many types of employment law cases. Especially, cases where the underlying law allows for attorney’s fees or where the claimant (you) is likely to get a monetary judgment (award) against the other party. These types of cases include discrimination cases, Whistelblower cases, pay and leave cases, and some discipline and wrongful termination cases. You can read more about those types of cases at our Employment Law Guides section.

My practice takes contingent fee cases. If you are interested in learning more about this type of fee arrangement continue reading.

Below are some common questions and answers related to contingent fees in employment cases.

Employment Law Case, Contingent Fee Agreement FAQs

What is a contingent fee?

A contingent fee means that the attorney handling your case doesn’t charge you anything for the time they  spent working on your case, unless you win. Their pay is contingent on you winning. Typically, if they do win your case they get between 20%-40% of the total recovery.

What if I lose my case?

Typically, if you lose you do not owe the attorney anything for the time the attorney spent working on your case. Attorney’s, however, cannot promise to pay the costs of your case for you (filing fees, expert witness fees, etc.). See Cal. Rules of Prof. Conduct 4-210. So in some instances, you may have to pay the costs associated with fighting your case. Make sure you discuss this arrangement with your attorney when you enter into a contract with them to avoid being surprised later.

What if I win my case?

Congratulations! You likely signed a fee agreement with the attorney and it will control how any award is disbursed. For example, lets say you entered into a contingent fee agreement with an attorney where the attorney would keep 33% of any recovery you got and the judge awarded you $30,000 in your discrimination case. The attorney would be entitled to $10,000 (1/3) and you would keep the remaining $20,000 (2/3).

How can costs affect my award in a contingent fee case?

This is a very important, and often overlooked, issue. Costs can add up in any case. It is important that you agree beforehand with your attorney regarding how costs will be paid for if you win your case. The reason this is so important will become very clear with the two illustrations below.

Lets say you win your case and get an award of $30,000. You and your attorney agreed he/she would get a third (33%) of any award. Let’s also assume there were $5,000 in costs. Great. So you’re thinking you are entitled to $20,000, right? Well, it may depend on when costs are taken out.

If costs are taken out before the contingent fee:

The split will look something like this: $30,000 (award) – $5,000 (costs) = $25,000. In that case $25,000, not $30,00 will then be split 66% for you 33% for the attorney.

Then the attorney gets: $8,333.33 (1/3 of $25,000)

You get: $16,666.66 (2/3 of 25,000)

If the fee is taken out first then costs are taken out:

Now lets say the agreement stipulates that the attorney gets his/her 33% first then costs are taken out with you getting the rest. In that scenario:

The attorney would get $10,000, a third of $30,000.

You would get $15,000. ($20,000 remaining minus $5,000 in costs).

See how there is a fairly significant difference between the two recoveries?

It is important you agree beforehand how costs will be taken out because as costs increase, it can greatly affect the amount of money each party ends up actually receiving.

What is a reasonable contingent fee?

Unfortunately, the answer is: it depends. An honest attorney will look at a number of factors when they determine whether to take your case, and the fee to charge. Some of those factors include: the amount of time your case will take to prosecute, the complexity of your case, the strength of your case, the likelihood of winning, and the prevailing rates in local legal community.

To illustrate, if you have a very complicated case with significant factual issues and legal hurdles that will require a great deal of briefing and effort by the attorney, the contingent fee percentage is likely to be higher. Moreover, if you are in a high cost-of-living-area like San Diego you are likely to be charged more.

We won my case, but now I think I paid too much, what can I do?

Generally, you are bound by the terms you entered into when you signed the original fee agreement. The main exception would be if the fee paid was grossly disproportionate to the amount of work done by the attorney. The ethics rules for attorneys require that the fees they charge not be unconscionable. See Cal. Rules of Prof. Conduct 4-200 What is unconscionable is determined on a case by case basis. But if your attorney only worked on your case for 5 hours and got a settlement for $500,000 and is trying to take a third–that would be unconscionable. The hourly rate equivalent would be around $33,000/hour which is beyond absurd.

If your case resolves quickly for a high recovery your attorney should be open to reducing their contingent fee percentage so the fee is not unconscionable. Just ask, and point them to the ethics rule cited above.

What about cases where you can get attorney’s fees awarded?

So, some statutes allow for the recovery of attorney’s fees if the claimant (you) is victorious in their case. For example, the federal Whistleblower Protection Act, provides for the award of both reasonable attorney’s fees and costs if you win your case before the Merit Systems Protection Board. See 5 U.S.C. 1221(g)(2).

What this means is that your attorney can attempt to recover their actual time (hours expended) at their hourly rate. So, for example, if they spent 100 hours on your case and their typical hourly rate is $400 they will seek $40,000 in attorney’s fees.

Can I (the client) keep some or all of the awarded attorney’s fees?

Typically, no. If a statute allows for attorney’s fees, any fee agreement you enter into will likely stipulate that the attorney’s fee award will go to the attorney. Moreover, there are ethical rules that prevent attorney’s from sharing legal fees with non-attorneys. See Cal. Rules of Prof. Conduct 1-320. As to the disbursement of other awards along with attorney’s fees, that is up to you and your attorney. Since contingent fee cases are risky and could easily result in no payment for the attorney, in some instances, the attorney may require that they get part of any recovery you get along with attorney’s fees to compensate them for the risk in expending all that time on your case.

Why won’t an attorney take my case on contingent fee?

If you have visited multiple attorneys and they have all declined to take your case on a pure contingent fee basis, it may be because you do not have a strong case, or that the statute under which you have a cause of action limits your potential recovery. Or, it could be for a host of other factors.

A simple illustration of the financial calculus that goes on when evaluating a contingent fee case is as follows. If an attorney knows the most you can recover is capped at $10,000 and they will easily spend $20,000 of their time on a case–that’s a losing proposition for them and you, so they won’t take your case. Again, there are many factors that go into the decision of whether or not to represent an individual, some of which have nothing to do with you, or your case, such as their current workload or familiarity with the specific area of law your case relates to.

What is a hybrid fee arrangement?

A subject that warrants an article all its own, hybrid fee arrangements are fees where the attorney and client agree to both a contingent fee and some other fee such as a flat rate or fixed fee. One potential arrangement is where a client agrees to pay the attorney a flat fee for taking their case, but in an amount much smaller than the attorney would get if they billed the case hourly. In return, the client also agrees the attorney will get a percentage of any recovery should they win the case. This arrangement can be very beneficial to both parties because it assures the attorney they will get minimal compensation for their work while still providing an incentive to win the client’s case. It is beneficial to the client because that upfront flat fee may get an attorney to take their case when they wouldn’t have if the case was purely based on a contingent fee. I have moved to using hybrid fees fairly often. I find these types of agreements can be negotiated to a point where they benefit both parties.

Wrapping up: Five things to remember about fee agreements

  1. Fees are negotiable, discuss and work out the details.
  2. Think about the possible scenarios that could occur, even the remote ones, when you are negotiating a fee agreement.
  3. People respond to incentives, contingent fees align the parties’ interests. Aligned interests are a good thing.
  4. Paying a big contingent fee to your attorney is actually a good thing, it means you won a big award and your attorney did a good job.
  5. Contingent fees help people get representation when the otherwise wouldn’t. Just because you do not have money, doesn’t make it legal to discriminate against you, wrongly terminate you, or deny you a reasonable accommodation.

I hope you found this information about employment-law fee agreements helpful.

 

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California Government Code Section 12965, parsed and explained

Mike Ivancie, Esq.

California Government Code Section 12965 is a commonly referenced statute that provides many of the deadlines and procedural rules for filing a case in California whether it was initiated and/or processed through the Equal Employment Opportunity Commission (EEOC) or the California Fair Employment and Housing Act (FEHA).

Below, I will go through subsections (a) through (e). The original text of the law will be reproduced in this format:

Text of California Government Code Section 12965 looks like this.

And my comments will appear like this text without any special formatting.

If you like, use the following table of contents to navigate to any specific subsection you have questions about.

California Government Code Section 12965

12965(a)

Part (a), provides that if an alleged discrimination case fails to settle through mediation or other alternative dispute resolution (ADR), the claimant may bring a civil action. A prerequisite to filing a civil action (court case) is that the parties engage in a free dispute resolution process.

If the claimant chooses to initiate a civil action, after going through the necessary procedures, they must file in any California county where the discrimination took place, where records related to those acts are, or where the claimant would have worked or had access to public accommodation had they not otherwise been the subject of unlawful acts. If the defendant is not located in any of these locations, an unlikely scenario, the case may be filed in a county where the defendant resides or has its principle office.

Class complaints, and those based on a violation of Section 51.7 of the Civil Code are subject to special rules and a claim in civil court must be filed two years after filing a complaint.

All other complaints must be filed in civil court one year from filing. Failure to do so could prevent the claimant from seeking redress entirely.

In the case of failure to eliminate an unlawful practice under this part through conference, conciliation, mediation, or persuasion, or in advance thereof if circumstances warrant, the director in his or her discretion may bring a civil action in the name of the department on behalf of the person claiming to be aggrieved. Prior to filing a civil action, the department shall require all parties to participate in mandatory dispute resolution in the department’s internal dispute resolution division free of charge to the parties in an effort to resolve the dispute without litigation. In any civil action, the person claiming to be aggrieved shall be the real party in interest and shall have the right to participate as a party and be represented by his or her own counsel. The civil action shall be brought in any county in which unlawful practices are alleged to have been committed, in the county in which records relevant to the alleged unlawful practices are maintained and administered, or in the county in which the person claiming to be aggrieved would have worked or would have had access to public accommodation, but for the alleged unlawful practices. If the defendant is not found in any of these counties, the action may be brought within the county of the defendant’s residence or principal office. For any complaint treated by the director as a group or class complaint for purposes of investigation, conciliation, mediation, or civil action pursuant to Section 12961, a civil action shall be brought, if at all, within two years after the filing of the complaint. For any complaint alleging a violation of Section 51.7 of the Civil Code, a civil action shall be brought, if at all, within two years after the filing of the complaint. For all other complaints, a civil action shall be brought, if at all, within one year after the filing of a complaint. If the director determines, pursuant to Section 12961, that a complaint investigated as a group or class complaint under Section 12961 is to be treated as a group or class complaint for purposes of conciliation, mediation, or civil action as well, that determination shall be made and shall be communicated in writing within one year after the filing of the complaint to each person, employer, labor organization, employment agency, or public entity alleged in the complaint to have committed an unlawful practice.

12965(b)

Section (b) governs when individuals have the right to file a complaint. In these cases, the FEHA has the initial option of filing a civil action. If those agencies choose not to file a civil action on the complainant’s behalf then they must do so on their own, if they wish to proceed.

If the FEHA decides not to file a civil action on the complainants behalf, or if more than 150 days elapse after the initial filing of a complaint, upon the complainant’s request they will be given a right-to-sue-notice.

The right-to-sue-notice (right to sue notice) is a very important document which outlines the procedural stance of your case and notifies your rights. The notice typically will provide that the complainant has one year to initiate a civil suit from the date they receive that notice.

If the complainant never requests a right-to-sue notice the FEHA will issue a right-to-sue-notice after its investigation is complete not later than one year after the filing of the original complaint.

This section also includes special rules for the filing of actions based on violations of law related to HIV/AIDS discrimination.

Additionally, civil cases brought under these laws may result in the award of reasonable attorney’s fees and costs, including expert witness fees.

If a civil action is not brought by the department within 150 days after the filing of a complaint, or if the department earlier determines that no civil action will be brought, the department shall promptly notify, in writing, the person claiming to be aggrieved that the department shall issue, on his or her request, the right-to-sue notice. This notice shall indicate that the person claiming to be aggrieved may bring a civil action under this part against the person, employer, labor organization, or employment agency named in the verified complaint within one year from the date of that notice. If the person claiming to be aggrieved does not request a right-to-sue notice, the department shall issue the notice upon completion of its investigation, and not later than one year after the filing of the complaint. A city, county, or district attorney in a location having an enforcement unit established on or before March 1, 1991, pursuant to a local ordinance enacted for the purpose of prosecuting HIV/AIDS discrimination claims, acting on behalf of any person claiming to be aggrieved due to HIV/AIDS discrimination, may also bring a civil action under this part against the person, employer, labor organization, or employment agency named in the notice. The superior courts of the State of California shall have jurisdiction of those actions, and the aggrieved person may file in these courts. An action may be brought in any county in the state in which the unlawful practice is alleged to have been committed, in the county in which the records relevant to the practice are maintained and administered, or in the county in which the aggrieved person would have worked or would have had access to the public accommodation but for the alleged unlawful practice, but if the defendant is not found within any of these counties, an action may be brought within the county of the defendant’s residence or principal office. A copy of any complaint filed pursuant to this part shall be served on the principal offices of the department. The remedy for failure to send a copy of a complaint is an order to do so. Those actions may not be filed as class actions or may not be maintained as class actions by the person or persons claiming to be aggrieved where those persons have filed a civil class action in the federal courts alleging a comparable claim of employment discrimination against the same defendant or defendants. In civil actions brought under this section, the court, in its discretion, may award to the prevailing party, including the department, reasonable attorney’s fees and costs, including expert witness fees.

12965(c)

Section (c) relates to the relief parties can receive if they win their case. Relief is a fancy word for what the court can order the losing party to do. In this case the court can award damages, but also may require that the employer provide additional discrimination focused training to its managers and employees going forward.

Additionally, this section provides that if the civil complaint properly requests it, and the complainant’s claim meets the requirements of Section 51.7 of the Civil Code, then they may also be awarded up to $25,000 civil penalty to be paid by the defendant.

A court may grant as relief in any action filed pursuant to subdivision (a) any relief a court is empowered to grant in a civil action brought pursuant to subdivision (b), in addition to any other relief that, in the judgment of the court, will effectuate the purpose of this part. This relief may include a requirement that the employer conduct training for all employees, supervisors, and management on the requirements of this part, the rights and remedies of those who allege a violation of this part, and the employer’s internal grievance procedures. In addition, in order to vindicate the purposes and policies of this part, a court may assess against the defendant, if the civil complaint or amended civil complaint so prays, a civil penalty of up to twenty-five thousand dollars ($25,000) to be awarded to a person denied any right provided for by Section 51.7 of the Civil Code, as an unlawful practice prohibited under this part.

12965(d)

Section (d) relates to the tolling (extending) of the statute of limitations in certain situations. Specifically, when the charge of discrimination is filed with both the EEOC and FEHA and the investigation is deferred by the FEHA to the EEOC and the right-to-sue is issued upon that deferral. The tolling lasts until the federal right-to-sue period expires or one year from the date of the right-to-sue notice issued by the FEHA, whichever is later.

(1) Notwithstanding subdivision (b), the one-year statute of limitations, commencing from the date of the right-to-sue notice by the Department of Fair Employment and Housing, to the person claiming to be aggrieved, shall be tolled when all of the following requirements have been met:

(A) A charge of discrimination or harassment is timely filed concurrently with the Equal Employment Opportunity Commission and the Department of Fair Employment and Housing.

(B) The investigation of the charge is deferred by the Department of Fair Employment and Housing to the Equal Employment Opportunity Commission.

(C) A right-to-sue notice is issued to the person claiming to be aggrieved upon deferral of the charge by the Department of Fair Employment and Housing to the Equal Employment Opportunity Commission.

(2) The time for commencing an action for which the statute of limitations is tolled under paragraph (1) expires when the federal right-to-sue period to commence a civil action expires, or one year from the date of the right-to-sue notice by the Department of Fair Employment and Housing, whichever is later. (3) This subdivision is intended to codify the holding in Downs v. Department of Water and Power of City of Los Angeles (1997) 58 Cal.App.4th 1093.

12965(e)

Similar to section (d), above, section (e) relates to the tolling (extending) of the statute of limitations in certain situations. Specifically, when the charge of discrimination is filed with both the EEOC and FEHA and the investigation is deferred by the EEOC to the FEHA and after the investigation by the Department of the FEHA, the EEOC agrees to perform a review of that determination, or conducts its own independent investigation.

The tolling, in this case, lasts until the federal right-to-sue period expires or one year from the date of the right-to-sue notice issued by the FEHA, whichever is later.

(1) Notwithstanding subdivision (b), the one-year statute of limitations, commencing from the date of the right-to-sue notice by the Department of Fair Employment and Housing, to the person claiming to be aggrieved, shall be tolled when all of the following requirements have been met:

(A) A charge of discrimination or harassment is timely filed concurrently with the Equal Employment Opportunity Commission and the Department of Fair Employment and Housing.

(B) The investigation of the charge is deferred by the Equal Employment Opportunity Commission to the Department of Fair Employment and Housing.

(C) After investigation and determination by the Department of Fair Employment and Housing, the Equal Employment Opportunity Commission agrees to perform a substantial weight review of the determination of the department or conducts its own investigation of the claim filed by the aggrieved person.

(2) The time for commencing an action for which the statute of limitations is tolled under paragraph (1) shall expire when the federal right-to-sue period to commence a civil action expires, or one year from the date of the right-to-sue notice by the Department of Fair Employment and Housing, whichever is later.

 

Conclusion

Hopefully you found this guide helpful. At this time we are not taking on any new clients. All information provided above is for reference purposes and should not be construed as legal advice. You should consult with a licensed attorney before taking any action in your case.

 

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What is a protected class?

Mike Ivancie, Esq.

Below is a chart that lays out the commonly recognized EEOC protected classes in discrimination law. You cannot have a discrimination case without a protected class. This chart can help you understand this crucial element of a discrimination case.

If you would like to learn more about discrimination law read our EEOC and Discrimination Law Guide.

Legally recognized protected classes

 

 

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The 45 day deadline to file a discrimination claim, Federal EEOC

Mike Ivancie, Esq.

As a federal employee, if you’re a victim of discrimination, you only have 45 days to initiate contact with your EEO counselor. Otherwise, your claim may be forever time barred:

(a) Aggrieved persons who believe they have been discriminated against on the basis of race, color, religion, sex, national origin, age, disability, or genetic information must consult a Counselor prior to filing a complaint in order to try to informally resolve the matter.
(1) An aggrieved person must initiate contact with a Counselor within 45 days of the date of the matter alleged to be discriminatory or, in the case of personnel action, within 45 days of the effective date of the action.
See 29 CFR 1614.105(a) (emphasis added).

 

This is a big departure from private sector employment law where you have 180 days to file a discrimination claim, and in some instances up to 300 days.

Public sector (federal) employment law is a unique animal, and when selecting an attorney you should choose someone with expertise in this area.

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EEOC Regulation covering pre-complaint processing

Mike Ivancie, Esq.

Below is the federal regulation which covers the EEO counseling process, sometimes referred to as the “informal” process by EEO offices. This regulation contains important information about the filing process and associated deadlines.

 

29 C.F.R. § 1614.105 Pre-complaint processing.

(a) Aggrieved persons who believe they have been discriminated against on the basis of race, color, religion, sex, national origin, age, disability, or genetic information must consult a Counselor prior to filing a complaint in order to try to informally resolve the matter.
(1) An aggrieved person must initiate contact with a Counselor within 45 days of the date of the matter alleged to be discriminatory or, in the case of personnel action, within 45 days of the effective date of the action.
(2) The agency or the Commission shall extend the 45-day time limit in paragraph (a)(1) of this section when the individual shows that he or she was not notified of the time limits and was not otherwise aware of them, that he or she did not know and reasonably should not have been known that the discriminatory matter or personnel action occurred, that despite due diligence he or she was prevented by circumstances beyond his or her control from contacting the counselor within the time limits, or for other reasons considered sufficient by the agency or the Commission.
(b)
(1) At the initial counseling session, Counselors must advise individuals in writing of their rights and responsibilities, including the right to request a hearing or an immediate final decision after an investigation by the agency in accordance with § 1614.108(f), election rights pursuant to §§ 1614.301 and 1614.302, the right to file a notice of intent to sue pursuant to § 1614.201(a) and a lawsuit under the ADEA instead of an administrative complaint of age discrimination under this part, the duty to mitigate damages, administrative and court time frames, and that only the claims raised in precomplaint counseling (or issues or claims like or related to issues or claims raised in pre-complaint counseling) may be alleged in a subsequent complaint filed with the agency. Counselors must advise individuals of their duty to keep the agency and Commission informed of their current address and to serve copies of appeal papers on the agency. The notice required by paragraphs (d) or (e) of this section shall include a notice of the right to file a class complaint. If the aggrieved person informs the Counselor that he or she wishes to file a class complaint, the Counselor shall explain the class complaint procedures and the responsibilities of a class agent.
(2) Counselors shall advise aggrieved persons that, where the agency agrees to offer ADR in the particular case, they may choose between participation in the alternative dispute resolution program and the counseling activities provided for in paragraph (c) of this section.
(c) Counselors shall conduct counseling activities in accordance with instructions contained in Commission Management Directives. When advised that a complaint has been filed by an aggrieved person, the Counselor shall submit a written report within 15 days to the agency office that has been designated to accept complaints and the aggrieved person concerning the issues discussed and actions taken during counseling.
(d) Unless the aggrieved person agrees to a longer counseling period under paragraph (e) of this section, or the aggrieved person chooses an alternative dispute resolution procedure in accordance with paragraph (b)(2) of this section, the Counselor shall conduct the final interview with the aggrieved person within 30 days of the date the aggrieved person contacted the agency’s EEO office to request counseling. If the matter has not been resolved, the aggrieved person shall be informed in writing by the Counselor, not later than the thirtieth day after contacting the Counselor, of the right to file a discrimination complaint. The notice shall inform the complainant of the right to file a discrimination complaint within 15 days of receipt of the notice, of the appropriate official with whom to file a complaint and of the complainant’s duty to assure that the agency is informed immediately if the complainant retains counsel or a representative.
(e) Prior to the end of the 30-day period, the aggrieved person may agree in writing with the agency to postpone the final interview and extend the counseling period for an additional period of no more than 60 days. If the matter has not been resolved before the conclusion of the agreed extension, the notice described in paragraph (d) of this section shall be issued.
(f) Where the aggrieved person chooses to participate in an alternative dispute resolution procedure in accordance with paragraph (b)(2) of this section, the pre-complaint processing period shall be 90 days. If the claim has not been resolved before the 90th day, the notice described in paragraph (d) of this section shall be issued.
(g) The Counselor shall not attempt in any way to restrain the aggrieved person from filing a complaint. The Counselor shall not reveal the identity of an aggrieved person who consulted the Counselor, except when authorized to do so by the aggrieved person, or until the agency has received a discrimination complaint under this part from that person involving that same matter.

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