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Jack and the wage and hour beanstalk

I admit maybe the title of this post should be “Shawn and the wage and hour beanstalk.” A recent decision by a Wisconsin court appeals keeps a long-running wage and hour complaint going even further in the battle for a large amount of attorneys’ fees. What may be most troubling for employers reading about this case is the comparatively small amount the plaintiff sought in unpaid compensation when she brought her claims.

Back in 2006, Johnson filed a complaint with the Wisconsin Department of Workforce Development for $9,500 in unpaid wages by her restaurant-employer. She eventually brought a complaint in state court against her former employer based on the Fair Labor Standards Act and similar Wisconsin wage and hour laws. Two – count’em two – trials later, Johnson received a jury award of $3,648.

However, Johnson didn’t stop there. Her case continued on in her pursuit of attorneys’ fees. Under the Fair Labor Standards Act, attorneys’ fees are awarded to a prevailing plaintiff. Wisconsin’s wage and hour laws differ by allowing a court to decide whether to award a reasonable attorney fee. After the second trial, Johnson requested $120,000 in attorneys’ fees. For those of you counting at home, that is $120,000 after initially asking for $9,500 in wages and receiving an award of just $3,648 from a jury. The judge granted Johnson $10,000 following her request. The reduced fee amount was based, in part, on what the circuit court felt was over-litigation by the parties based on emotion.

The Wisconsin Court of Appeals took issue with the circuit court’s lack of explanation in reducing the fee requested by Johnson. The case is now on remand back to the circuit court to take another look at the attorneys’ fees issue.

This case is important for employers to note because of the heavy consequences FLSA litigation can have over arguably small amounts of unpaid wages. As described above, a significant difference between the FLSA and Wisconsin wage and hour law is that the FLSA requires attorneys’ fees to be awarded to a prevailing plaintiff. The decision to make an award under a Wisconsin law claim is left to the court’s discretion. Employers need to make sure practices are FLSA compliant to avoid even minor errors so they do not become a victim of hefty attorneys’ fees.