Yesterday we posted on a California state agency’s insistence that it’s illegal to operate a women-only fitness center (see “What? We Have to Excercise Our Flab Away in Front of MEN?,” Jan. 5).
Now, blogstress Bookworm Room e-mails to remind us that last July she posted on another administrative horror show in California: the obligation of an employer to pay an former employee’s attorney’s fees in a California Labor Commission case–even if the employer partially wins! Bookworm writes:
“I wasn’t surprised to read your post about the gym that is being forced to admit a man, even though it’s a private business that is especially aimed at women who would prefer that men not witness their transformation from soignee to sweating, and back again….
“About a half year ago, I did a lengthy post about California’s bizarre attorney’s fee policy in one area of employment law, a policy that makes it virtually impossible for California employers to challenge Labor Commission decisions–no matter how unfair they may be. It’s clear that California is bound and determined to destroy its tax base by making it impossible, or at least incredibly undesirable, to run a viable business in this state.”
And don’t miss reading about he absurdity Bookworm describes:
“Picture this: It’s 2001. You live in California and you own a small business that consists of you and three to five at-will employees. Your profits are decent.
“One morning, Jane, one of your employees, announces that she’s quitting, effective immediately, and stalks out. You know — or think you know — your California law, which requires that, when an employee quits, you have her payment ready within three days of her departure. (That would be Calif. Lab.Code § 202.) You therefore immediately prepare Jane’s final paycheck, covering the two hours she worked before she quit.
“One day goes by, no Jane. Two days, no Jane. On the third day, you actually drive over to her place to drop off the check, only to discover it’s a vacant apartment. You head back to the office, check still in hand. Jane didn’t ask that you mail the check to her, nor do you have a current address, so for the
time being, you just hold on to it.
“On the fifth day after quitting, Jane shows up, grabs the paycheck, and again disappears. You breath a sigh of relief, thinking you’re finally done with Jane. If only you knew, the story is just beginning….”
Yeah, Jane complains to the state Labor Commission that you paid her two days late, and the Commission levies a fine on you equal to 27 times Jane’s paycheck. You appeal to a court, and Jane gets freebie representation by the Labor Commission. The judge rules that, yes, you blew it technically when you paid Jane two days late, but he does cut your penalty in half–whew! Good idea that you challenged the Labor Commission! Not exactly, for the judge also rules that you still “lost” your case because you didn’t win by 100 percent, so you’ve got to pay the Labor Commission’s “attorney’s fees” at a rate comparable to the fees charged by private law firms.
The California Supreme Court eventually rules that it’s unfair to levy huge attorney’s fees in such cases–but then the California legislature passes a law overturning the Supreme Court holding and saying that the employer must pay the attorney’s fees of any employee who gets an award of “greater than zero” in a contested case. So you, the employer lose in many cases even if you win.
And those “attorney’s fees.” by the way, are strictly a windfall to the Labor Commission. The disgruntled employee never had to pay a cent for his or her state-supplied lawyers, and the Labor Commission’s lawyers work on salary. The idea that anyone–except the employer, who must pay for his or her own lawyer–is out a cent for a attorney’s fees in these cases is strictly a fiction. It’s merely a punitive device levied because California happens to demonize employers.
Great business climate California has, doesn’t it? Makes you want to run right out and hire a bunch of Californians.