Gottlieb v. Kenneth D. Laub & Co., 82 N.Y.2d 457 (1993)
The statutory entitlement to attorney’s fees in wage claim actions under New York Labor Law § 198(1-a) applies only to claims based on violations of the wage payment provisions within Article 6 of the Labor Law, not to common-law contract claims for unpaid wages.
Summary
Seymour Gottlieb, a real estate salesman, sued his former employer, Kenneth D. Laub & Co., to recover commissions owed under a written employment agreement. Gottlieb’s claim was based on common-law contract principles, not on any specific provision of Article 6 of the New York Labor Law. He sought attorney’s fees and liquidated damages under Labor Law § 198(1-a). The New York Court of Appeals held that § 198(1-a)’s provision for attorney’s fees applies only to wage claims based on violations of Article 6 of the Labor Law, which establishes specific requirements for wage payments, and not to general contract claims for unpaid wages. The Court reasoned that the legislative intent behind § 198(1-a) was to enhance enforcement of the Labor Law’s substantive wage enforcement provisions, not to create a new remedy for all contract disputes involving wages.
Facts
Seymour Gottlieb worked as a real estate salesman for Kenneth D. Laub & Co. for 17 years. His compensation was based on a percentage of commissions earned by the company on transactions he was involved in, as defined by a written agreement. After his termination in 1987, Gottlieb sued to recover commissions he claimed were due from three specific transactions. He did not allege any violation of the specific wage payment requirements detailed in Article 6 of the New York Labor Law.
Procedural History
Gottlieb initially prevailed at trial, and the Supreme Court awarded him attorney’s fees under Labor Law § 198(1-a). However, the Supreme Court set aside the jury’s finding of willfulness regarding the withholding of commissions. The Appellate Division affirmed the award of attorney’s fees. The Court of Appeals granted leave to appeal, limiting the issue to the applicability of Labor Law § 198. The Court of Appeals then reversed the portion of the Appellate Division order holding that Labor Law § 198 (1-a) applies.
Issue(s)
Whether the attorney’s fees provision of Labor Law § 198(1-a) applies to any wage claim action or only to those brought for violations of the wage payment law, Article 6 of the Labor Law.
Holding
No, because the plain language, legislative history, and purpose of section 198(1-a) indicate that the intent of the statute is limited to wage claims based upon violations of one or more of the substantive provisions of Labor Law Article 6.
Court’s Reasoning
The Court reasoned that the language of Labor Law § 198(1-a), referring to an employer’s