Sip on This One -- The Starbucks Class Action Wage Lawsuit

In 2008 barista, Summer York, filed a class action against Starbucks alleging missed meal periods, missed breaks and for receiving inaccurate wage statements.  The lawsuit initially sought $10 million.  It eventually settled, in May of 2013, for $3 million.  The lawsuit was based, in part, on the Starbucks two-partner rule.  This rule prevented one barista from taking a meal or rest period if only one other employee was present.  This is the only class that the court certified. 

Attorneys for Ms. York and other plaintiffs have now filed a motion seeking $4.5 million in attorneys' fees for recovering $3 million for their clients.  Surprise!  No not really.  This is the real story of the case, and of most employment-related claims. 

I'm sure Ms. York received adequate compensation for her unpaid rest and meal periods.  She probably also received some money for waiting period penalties.  But the total she received probably did not make a dent in the $3 million settlement.  As lead plaintiff she also received a $10,000 bonus.  Ok, so she was over-compensated at the end of the day.  But still, this is a drop in the bucket compared to the attorneys' fees. 

These cases are prosecuted primarily for the attorneys' fees.  Ms. York probably had little to do with the case.  She probably was not that involved in deciding whether to pursue a class-action case as oppposed to her own little action with the Labor Commissioner.  Instead, the attorneys called the shots.  Why?  In this case there are 4.5 million reasons. 

The prospect of attorneys' fees in employment cases should serve as motivation for businesses to focus on their compliance practices.  Attorneys' fees can far exceed the amount of an adverse judgement.  Is this fair?  It depends on who you ask.  A trial attorney will tell you that the rights of the poor baristas of the world can be vindicated only because of the attorneys' fees award.  A business owner, large or small, will point to the fees as a gross exaggeration of justice. 

I agree with the latter opinion.