Who Pays Attorney’s Fees?
Who Pays Lawyer’s Fees?
by Stephen P. Horner, Esq.
Question:
How are legal fees handled for employment cases?
Steve J., Norwalk
Response:
The traditional “American rule” has been that each side in a lawsuit pays for its own attorney. This is still the case for most lawsuits—such as negligence and breach of contract cases—in the United States.
A company’s legal defense to employment claims is virtually always on an hourly rate basis.
However, since the U.S. Congress wanted to assure that employees did not suffer from discrimination in the workplace, numerous anti-discrimination statutes provide that the court can award a legal fee to the successful plaintiff. As a practical matter, a “reasonable” attorney’s fee is customarily granted by the court in such cases where the plaintiff wins his/her claim. Such fee is paid by the defendant company.
Some of the federal laws that provide for such court-awarded legal fees include:
The Age Discrimination in Employment Act (prohibits age discrimination).
Title VII of the civil Rights Act of 1964 (prohibits discrimination on the basis of race, sex, religion, national origin, color).
Equal Pay Act (makes it illegal, in general, to discriminate in the payment of wages on the basis of sex for equal work).
If a plaintiff wins his or her case of discrimination and the court orders the defendant company to pay a reasonable attorney’s fee as part of the remedy, that fee award usually (depending on the terms of the fee agreement with the attorney) will reduce or replace the fee owed by the plaintiff to his or her attorney.
Employment attorneys usually represent plaintiffs on either an hourly or contingency fee arrangement. The hourly rate varies from attorney to attorney, but usually ranges from approximately $250 to $425 per hour, plus expenses.
Contingency fee arrangements frequently require an initial retainer fee payment (which may sometimes be applied to any subsequent recovery) and a one-third payment of whatever recovery is made.
Assuming that the court-awarded legal fee is greater than one-third of the recovery, then most contingency fee agreements provide that the plaintiff keeps the entire amount of the recovery.
If the awarded fee is less than the one-third amount, on the other hand, then the client normally would only make up the difference and keep the remainder.
With regard to Steve’s question as to what the attorney would charge, the answer will obviously vary from attorney to attorney—just like medical bills will vary from doctor to doctor.
What is essential in order to obtain such representation is for the individual to have a valid claim to pursue.
Neither the attorney nor the individual is served by pursuing a groundless claim. Clearly, the value of having one’s possible claim evaluated is to learn whether it is worth pursuing or not.
