California Sexual Harassment: Attorney Fees and Cost-Shifting Rules
California’s framework for sexual harassment claims intertwines two forces that shape outcomes long before a jury hears a word: the rules that award attorney fees and the rules that shift litigation costs. For workers, those rules open the courthouse door in cases that would otherwise be impossible to fund. For employers, they alter settlement calculus, discovery strategy, and the appetite for motions. Understanding how fee statutes and cost-shifting interact with the California Fair Employment and Housing Act, and with procedural rules like Code of Civil Procedure section 998, often determines whether a case settles early or becomes a years-long fight.
The starting point: FEHA’s fee-shifting purpose
FEHA sexual harassment claims, including hostile work environment and quid pro quo harassment in California, are fundamentally civil rights cases. California wanted victims to be able to enforce their rights regardless of personal resources. So under Government Code section 12965(b), a court may, in its discretion, award “reasonable attorney’s fees and costs” to a prevailing party. In practice, courts award fees to prevailing plaintiffs as a matter of routine because that is the mechanism that makes the law workable for ordinary people. Without it, most employees could not hire counsel to litigate against well-funded employers.
Prevailing defendants can also seek fees, but California sharply limits those awards to situations where the plaintiff’s case was frivolous, unreasonable, or groundless. That standard, drawn from federal civil rights jurisprudence and mirrored in California cases, reflects the policy: fear of paying an employer’s legal bill should not deter a victim from pursuing a good-faith sexual harassment claim in California.
The difference in risk between plaintiffs and defendants drives strategy. A plaintiff who wins even modest compensatory damages can seek a lodestar fee award that frequently exceeds the damages themselves. A defendant, by contrast, typically cannot recover fees unless it proves the claim never should have been brought. That asymmetry is by design.
What counts as “reasonable” fees in FEHA cases
Reasonableness starts with the lodestar method: hours reasonably spent multiplied by a reasonable hourly rate for comparable work in the community. In Los Angeles or the Bay Area, experienced trial counsel in California sexual harassment lawsuits may command rates from the high 300s to 800 dollars per hour, sometimes more for top specialists. Courts examine declarations from other attorneys and market surveys to gauge a fair rate.
Once the court sets the lodestar, it may apply a multiplier up or down. Factors include the novelty and difficulty of the issues, skill displayed, contingency risk borne by counsel, delay in payment, and the degree of success. Multipliers from 1.2 to 2.0 are common in contingent FEHA cases where counsel invested significant time with no guarantee of payment. In a hostile work environment case that required a hard-fought trial and produced meaningful public or private benefits, the multiplier can recognize both the risk and the broader deterrent effect.
Defendants often attack the hours claimed. Typical arguments target block billing, duplication among team members, excessive law and motion practice, or unnecessary depositions. Courts may trim hours for redundancy, but they generally avoid line-by-line audits. Judges look for proportionality and efficiency, and they respect the reality that sexual harassment litigation in California often turns on credibility, which drives extensive discovery and trial prep.
Costs and expert fees: FEHA’s broader recovery
FEHA’s fee provision uses the phrase “reasonable attorney’s fees and costs.” That phrasing matters because it allows successful plaintiffs to recover a broader set of litigation expenses than those allowed under the general cost statute. Expert witness fees illustrate the difference. The ordinary cost statute, Code of Civil Procedure section 1032 and section 1033.5, usually bars recovery of expert fees unless a section 998 offer applies. FEHA opens the door for prevailing plaintiffs to recover expert fees as a component of “reasonable” fees and costs when those experts were necessary to the litigation.
In a California sexual harassment case, experts are common. A mental health expert may testify about emotional distress, or an economist may analyze lost earnings after a constructive dismissal. Human resources experts often provide context on employer responsibility for sexual harassment in California, training gaps, and compliance with the California sexual harassment policy requirements. Under FEHA, those expert fees can be recovered by a prevailing plaintiff even without a 998 interplay.
By contrast, prevailing defendants have a much steeper climb to recover expert fees or any significant costs. They must first clear the “frivolous case” barrier for fees. Without that, their recovery is generally limited to standard costs, which a court may deny if awarding costs would be inequitable in a civil rights context. California courts often exercise discretion to deny costs to defendants against unsuccessful FEHA plaintiffs because of the risk of chilling enforcement.
Section 998 offers in the FEHA landscape
California’s section 998 is a powerful settlement tool across civil litigation. Either side can make a written offer to allow judgment on specified terms. If the other side rejects the offer and fails to obtain a more favorable result at trial, substantial cost-shifting follows. Defendants who beat their offer can recover post-offer costs, including potentially large expert witness fees. Plaintiffs who beat their offer can recover their post-offer costs and may strengthen their claim for a multiplier.
998 intersects awkwardly with FEHA’s one-way fee policy. Courts strive to honor FEHA’s protective purpose while enforcing the statute’s settlement incentives. A few practical effects follow:
A defendant’s 998 offer that the plaintiff fails to beat may limit the plaintiff’s recovery of post-offer fees if the court finds continued litigation unreasonable in light of the offer. The key is reasonableness, not rigid arithmetic. If the offer was ambiguous, included non-monetary terms that undermined its value, or did not address statutory fees, courts are reluctant to punish the plaintiff for pressing on.
A plaintiff’s 998 offer that the defendant fails to beat can enhance the plaintiff’s fee claim. Post-offer work to prepare for trial, rely on experts, and present evidence of a hostile work environment in California or quid pro quo harassment California becomes more defensible as a reasonable response to a rejected fair offer.
Expert fees for a defendant after a plaintiff fails to beat a defense 998 are possible, but judges weigh FEHA’s policies. In many cases, courts either decline to award defense expert fees or reduce them significantly unless the case was obviously meritless after discovery.
From experience, the cleanest 998 offers specify that fees and costs are “in addition to” the stated amount or specify a lump sum that is inclusive of fees and costs. Offers that are silent on fees risk disputes, and ambiguity tends to get construed against the offeror.
Practical economics: why fee-shifting drives settlements
Because attorney fees can dwarf damages, both sides analyze fee risk early. Consider a California workplace sexual harassment case where the employee has 75,000 dollars in lost wages and significant emotional distress, but the employer’s exposure on fees, if the plaintiff prevails, could reach 300,000 to 700,000 dollars by the end of trial. That math puts strong pressure on defense to settle sooner and incentivizes plaintiffs to build the fee record carefully.
On the defense side, early 998 offers calibrated to plausible verdict ranges can shift leverage, especially if paired with a credible motion plan or depositions that expose weaknesses. On the plaintiff side, a well-documented contingent fee agreement, accurate timekeeping, and strategic use of experts build a fee petition that will survive scrutiny. It is common to see FEHA sexual harassment settlements in California that explicitly allocate a portion to fees and costs, or that are written as a global number with a separate agreement on fees.
What “prevailing” means in the FEHA context
Prevailing party status is not always tied to a jury verdict. Plaintiffs can prevail via judgment after a bench trial, a favorable summary judgment ruling on liability followed by damages, or a consent decree that materially changes the relationship between the parties. Nominal damages can still support fees if the outcome achieved meaningful non-monetary relief or vindicated important rights. Conversely, if a plaintiff rejects a solid 998 and then wins only a small fraction of what was offered, a court may pare back the fee award to reflect limited success.
Defendants rarely obtain prevailing party status for fee purposes unless they secure a final judgment on the merits that undermines the core of the case. Voluntary dismissals sometimes trigger disputes. If a plaintiff dismisses after an employer corrects unlawful practices or pays a confidential settlement, courts often find no prevailing party or decline to award defense costs, especially in civil rights matters.
How fee-shifting interacts with typical claims and defenses
California sexual harassment definition and proof standards impact fees because they shape discovery and trial length. Hostile work environment California claims often involve a pattern of verbal sexual harassment or physical sexual harassment, spanning months or years. That means many witnesses, voluminous text messages, chat logs, and a detailed timeline. Quid pro quo harassment California claims focus more tightly on specific demands for sexual favors in exchange for job benefits or to avoid adverse actions, sometimes with clearer documentary evidence. Hostile environment cases can be more expensive to litigate, and the eventual fee award tends to reflect that scope.
Defense strategies can affect fee awards. Repeated, unsuccessful discovery motions, or a motion for summary judgment that ignores material factual disputes, can inflate the lodestar and weaken the argument that plaintiff’s hours were excessive. Conversely, focused motion practice, stipulations that narrow issues, and early production of key evidence are the kinds of steps judges remember when deciding whether the plaintiff’s time was reasonable.
Retaliation claims frequently travel with sexual harassment claims in California. When an employee reports harassment and faces demotion, termination, or other adverse actions, the FEHA sexual harassment retaliation component increases damages exposure and can lengthen trial. It also bolsters a fee petition by showing a broader violation with public policy implications.
The role of training and policy compliance in fee exposure
California sexual harassment training requirements, such as AB 1825 and SB 1343, require training for supervisors and non-supervisors at covered employers. Evidence that an employer complied with training, maintained a compliant California sexual harassment policy, and conducted prompt, thorough investigations does not bar liability if harassment occurred. But it can influence credibility, employer liability for sexual harassment California, and potentially the court’s view of reasonable fees.
In hostile work environment laws California, employer liability often turns on whether the harasser was a supervisor and whether the employer took reasonable steps to prevent and correct harassment. If the harasser was a supervisor and the employee suffered a tangible employment action, liability is strict. If no tangible action occurred, the employer’s prevention and prompt correction efforts become relevant. Employers who can show robust training, an effective sexual harassment complaint process California, and a swift California sexual harassment investigation may still be liable, but juries often see lower culpability, which can curb damages and, by extension, the proportionality of fee awards.
How federal and state forums differ on fees
Some California cases proceed in federal court under Title VII alongside FEHA. Federal law also awards fees to prevailing plaintiffs, with prevailing defendants again needing to show frivolousness. But federal judges sometimes take a narrower view of fee multipliers, and expert fee recovery under Title VII is more limited unless justified under separate authority. Plaintiffs who value the broader FEHA cost recovery and state law multipliers often choose state court unless removal is unavoidable.
The Equal Employment Opportunity Commission process can overlap with California civil rights department sexual harassment procedures. Administrative complaints are not where fee awards occur, but the timing related to the California sexual harassment statute of limitations matters. FEHA generally requires filing with the Civil Rights Department (formerly DFEH) before suing, and timely filing preserves the right to seek later fees and costs in court.
Settlement structuring to address fees and taxes
Settlement agreements in sexual harassment California cases typically address attorney fees explicitly. Common approaches include a global figure with a separate line for fees and costs, or a lump sum inclusive of fees. The choice may carry tax consequences. Emotional distress damages not attributable to physical injury are taxable as income, though they are not wages. Back pay is wages, subject to withholdings. Attorney fees paid by the defendant directly to plaintiff’s counsel under a fee-shifting statute may still be treated as income to the plaintiff, with an above-the-line deduction available under section 62(a)(20) for certain unlawful discrimination claims. The tax treatment is fact-specific, so parties often consult tax professionals during mediation.
Independent contractors, third parties, and fee exposure
Independent contractor sexual harassment California protections exist under FEHA, reflecting expanded coverage beyond traditional employees. Fee-shifting applies there too. Third party sexual harassment California claims arise when clients or customers harass an employee. Employers can be liable if they fail to take reasonable steps to protect the worker. The complexity of these relationships adds witnesses and factual disputes, increasing the hours reasonably expended and supporting substantial fee awards when plaintiffs prevail.
Coworker sexual harassment California claims require proof that the employer knew or should have known of the conduct and failed to act. Cases hinging on reporting sexual harassment California and whether the employee used internal processes often involve careful reconstructions of who said what and when. Those reconstructions drive deposition counts and document review, which later drive fee petitions.
Evidence choices that influence eventual fee awards
Not every piece of evidence is worth the cost to obtain. In sexual harassment evidence California practice, targeted digital forensics can authenticate text messages or social media direct messages, but full device imaging can be overkill unless spoliation or deletion is suspected. Medical records should be narrowed to relevant periods to reduce motion practice over privacy. For plaintiffs, documenting contemporaneous complaints to HR, calendar notes, and corroborating witnesses makes the case cheaper to prove and harder to defend. For employers, preserving Slack, Teams, and email data early prevents costly spoliation disputes that often grow fee claims.
Mediation, arbitration, and their distinct fee dynamics
California sexual harassment mediation is where many cases resolve. Mediators often push both sides to sanity-check fee projections. Plaintiffs arrive with time summaries to date, a forecast through trial, and expert budgets. Defendants arrive with their own cost estimates and the 998 angles. The split between damages and fees becomes a focal point. Where a plaintiff’s documented fees already exceed projected damages, parties may craft a settlement with a structured fee payment to bridge the gap.
Sexual harassment arbitration sexual harassment lawyer california California has its own fee rules. California law requires employers to bear unique forum costs in mandatory employment arbitrations that employees would not bear in court. That means the employer must pay arbitrator fees and administrative charges. FEHA fee-shifting still applies to prevailing plaintiffs after an arbitration award, and courts can confirm awards that include attorney fees. Defendants sometimes argue for reduced multipliers in arbitration, but that depends on the arbitrator’s assessment and the agreement’s terms.
Timelines and filing deadlines that affect fees
The filing deadline sexual harassment California regime changed with AB 9, lengthening the time to file an administrative charge with the Civil Rights Department to three years for events after the change. Counsel use the extra time to build cases carefully, but elongated timelines can increase discovery volume and the fee lodestar. On the defense side, earlier preservation instructions and internal audits mitigate that growth. A crisp California sexual harassment case timeline, focused on key episodes and corroboration, contains cost and aligns with a later argument that fees are reasonable in light of results achieved.
When defendants can actually win fees
There are cases where a defendant can recover fees under FEHA. Think of a claim with no factual basis, contradicted by video evidence, or dismissed on summary judgment after the plaintiff ignored dispositive admissions. Courts do not hesitate to protect defendants against truly groundless claims. Still, employers should tread carefully. Fee motions against employees who brought plausible claims but lost after a close credibility contest are rarely successful and can provoke judicial criticism.
In the narrow window where a defense fee award is possible, documentation matters. Identify the precise point in the litigation when it became clear the claim was frivolous, show how you communicated that to opposing counsel, and quantify the incremental fees caused by the refusal to dismiss. Courts are more receptive when the record shows a measured approach rather than a victory lap.
How policy trends shape the fee landscape
California’s Legislature has repeatedly strengthened protections for victims of sexual harassment at work California. Extensions of limitations periods, restrictions on NDAs regarding factual bases, and expanded coverage for independent contractors and smaller employers all reinforce FEHA’s remedial purpose. Those trends support robust fee awards to prevailing plaintiffs. At the same time, courts encourage proportionality. When a plaintiff wins nominal damages after rejecting a generous 998, expect the fee award to be trimmed. When a plaintiff proves supervisor sexual harassment California with serious emotional distress and lost income, enhanced multipliers are more likely.
Practical guidance for employees and employers
For employees thinking about a sexual harassment claim California, or asking what is considered sexual harassment in California, fee rules are your ally. They allow you to hire a California sexual harassment attorney on contingency and pursue a case without paying upfront. But fee recovery is not automatic. Keep detailed records, follow internal reporting channels if safe to do so, and cooperate with your lawyer on discovery. If you receive a 998 offer, evaluate it carefully against realistic trial outcomes.
For employers, treat the fee variable as a primary risk, not an afterthought. Train supervisors in line with AB 1825 and SB 1343, update your California workplace harassment laws compliance, and enforce a clear complaint process. When a complaint surfaces, move fast and document every step of your sexual harassment investigation California. If litigation begins, consider early mediation. Calibrate a 998 offer that accounts for fees to date and a sober estimate of what the next year of litigation will cost. In motion practice, be selective and credible. Judges notice when you took the shortest path to the truth.
A brief note on arbitration agreements and fee carve-outs
Many employers use arbitration agreements. California courts scrutinize them for unconscionability and compliance with Armendariz principles, including adequate discovery and neutral arbitrators. Agreements cannot require employees to bear forum fees they would not pay in court. They also cannot strip statutory remedies, including fee-shifting. Attempts to contract around FEHA fee provisions generally fail. Employers should review agreements to ensure they are enforceable and aligned with California labor code sexual harassment protections and public policy.
Where fees meet damages and settlements
Sexual harassment damages California include economic losses, emotional distress, and, where justified, punitive damages. Attorney fees sit alongside those remedies. When cases settle, parties often agree on a combined number that includes compensation for damages and a separate amount for fees and costs. In some California sexual harassment settlements, parties stipulate to a confidential fee amount while the judgment reflects a single figure. The structure can affect perception, taxes, and enforceability. What matters most is clarity: spell out whether fees are included or in addition, how costs and expert fees are handled, and whether the court will retain jurisdiction to enforce payment.
Final thought
Fee-shifting is not a sideshow in California sexual harassment litigation. It is the engine that powers civil rights enforcement and the lever that moves settlements. Employers who understand the fee dynamics make smarter choices about policy, training, and early resolution. Employees who understand them can evaluate risk, demand fair terms, and keep faith with the process. In a field where cases often turn on hard memories rather than perfect documents, the fee rules ensure that truth can still find a forum.