Watkins v. Labor and Industry Review Com'n

• Decision Date: 27 March 1984
• Docket Number: No. 82-2084,82-2084
• Citation: 345 N.W.2d 482,117 Wis.2d 753
• Parties: , 40 Fair Empl.Prac.Cas. (BNA) 1195, 35 Empl. Prac. Dec. P 34,888 Gloria A. WATKINS, Petitioner-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Respondent.
• Court: Wisconsin Supreme Court

Page 482

345 N.W.2d 482

117 Wis.2d 753, 40 Fair Empl.Prac.Cas. (BNA) 1195,

35 Empl. Prac. Dec. P 34,888

Gloria A. WATKINS, Petitioner-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Respondent.

No. 82-2084.

Supreme Court of Wisconsin.

Argued Jan. 30, 1984.

Decided March 27, 1984.

Jeff Scott Olson, Madison (argued), for petitioner-appellant; Julian & Olson, S.C., Madison, on brief.

David C. Rice, Asst. Atty. Gen. (argued), with whom on brief was Bronson C. La Follette, Atty. Gen., for respondent.

Nola J. Hitchcock Cross and Podell, Ugent & Cross, S.C., Milwaukee, filed brief amicus curiae, for Milwaukee Dist. Council 48, American Federation of State, County & Municipal Employees, AFL-CIO.

WILLIAM A. BABLITCH, Justice.

Does the Wisconsin Fair Employment Act authorize the Department of Industry, Labor and Human Relations (DILHR) to award reasonable attorney's fees to the prevailing complainant in a discrimination action even though that Act contains no express statutory language authorizing such an award? This is the question raised by Gloria Watkins, the prevailing party in a racial discrimination action that she brought against her employer under this Act. She contends that the authority is implicit in the language of the Act and is necessary to carry out the legislative intent. Because the Act is designed both to discourage discriminatory practices in the work place and to make whole anyone discriminated against, and because the legislature specifically mandated in the Act that the Act shall be liberally construed, we hold that DILHR has the authority to award reasonable attorney's fees to a prevailing complainant. We reverse and remand the case to DILHR for proceedings consistent with this opinion.

In 1971, Gloria Watkins was employed as a case worker for the Milwaukee county department of public welfare. On May 25, 1971, Watkins filed a charge of unlawful racial discrimination against her employer under the Wisconsin Fair Employment Act ¹ with the Equal Rights Division of DILHR. In her complaint, Watkins alleged that on several occasions she had been discriminatorily denied the opportunity to transfer into a service zone position. Although such a transfer did not involve any pay increase, Watkins had requested the transfer because she believed that the work involved in a service zone position was more desirable.

Nearly ten years later, after a lengthy and protracted process, including hearings by DILHR, reviews by the Labor and Industry Review Commission (LIRC) and the circuit court, an appeal to this court (Watkins v. ILHR Department, 69 Wis.2d 782, 233 N.W.2d 360 (1975)), and further proceedings with DILHR, DILHR determined that the county had on several occasions discriminated against Watkins on the basis of her race in violation of the Fair Employment Act. Because there was no pay differential between Watkins' previous position and a service zone position, she received no monetary award. What Watkins essentially received was a decision confirming that she had been a victim of unlawful racial discrimination, and an order to her employer not to do it again. Watkins also received a bill from her attorney in the amount of $2,658.36. LIRC issued a decision and order denying her request for reimbursement of her reasonable attorney's fees because it concluded that DILHR was not authorized under the Act to award such fees to a prevailing complainant.

Watkins petitioned the circuit court for review of LIRC's decision and order. The court affirmed the decision and order issued by LIRC. Watkins subsequently appealed to the court of appeals. Watkins and LIRC then filed with this court a joint petition to bypass the court of appeals, which we granted.

Watkins contends that an award of reasonable attorney's fees to a complainant who prevails in an action brought pursuant to the Wisconsin Fair Employment Act is implicitly authorized under the Act. She points to the language of the statute, which directs that the provisions of the Act be liberally construed to accomplish its purposes. She argues that although the provisions of the Act do not expressly state that DILHR has the authority to award attorney's fees to a prevailing complainant, such authority should be inferred from the broad remedial language of former sec. 111.36(3)(b), Stats.1975. That provision, set out in full below, ² directs the Department to "make written findings and order such action ... as will effectuate the purpose of this subchapter...." Although sec. 111.36(3)(b) was subsequently amended, this language was not changed.

In the United States, a prevailing litigant ordinarily is not entitled to collect a reasonable attorney's fee from the opposing party as part of his or her damages or costs. Alyeska Pipeline Co. v. Wilderness Society, 421 U.S. 240, 241, 247, 95 S.Ct. 1612, 1613, 1616, 44 L.Ed.2d 141 (1975). This is the "American rule". We have previously cited this rule as the applicable rule in Wisconsin. See, e.g., Cedarburg L. & W. Comm. v. Glens Falls Ins. Co., 42 Wis.2d 120, 124-25, 166 N.W.2d 165 (1969). However, in Cedarburg, we recognized that there are various exceptions to and modifications of this rule. Id. We also noted that the American rule does not apply when there are contractual or statutory provisions authorizing the recovery of attorney's fees by a prevailing litigant. See 42 Wis.2d at 124, 166 N.W.2d 165.

In determining whether there was statutory authorization for an award of reasonable attorney's fees, federal courts have construed provisions containing broad remedial language to allow recovery of attorney's fees despite the absence of express statutory language allowing such an award. In Smith v. Califano, 446 F.Supp. 530 (D.D.C.1978), the court held that Title VII of the Civil Rights Act of 1964, 42 U.S.C. sec. 2000e et seq., conferred authority upon a federal administrative agency to allow an award of attorney's fees to successful plaintiffs. Although the court acknowledged that Title VII does not expressly provide that the agency may award attorney's fees, it nevertheless concluded that such power was authorized under sec. 717(b), 42 U.S.C. sec. 2000e-16(b), which requires the agency to "enforce the provisions [prohibiting employment discrimination] through appropriate remedies, including reinstatement or hiring of employees with or without back pay, as will effectuate the policies of this section...." Similarly, in Krodel v. Young, 576 F.Supp. 390, 33 Empl.Prac.Dec. (CCH) p 34,061 (D.D.C.1983), the court held that an award of attorney's fees to a plaintiff who prevailed in an action brought pursuant to the Age Discrimination in Employment Act, 29 U.S.C. sec. 621 et seq., was authorized under sec. 633a(c) of the Act, which allows an aggrieved person to bring a civil action "... in any Federal district court of competent jurisdiction for such legal or equitable relief as will effectuate the purposes of this chapter."

LIRC argues that the language of sec. 111.36(3)(b), Stats., lacks sufficient specificity to authorize an award of attorney's fees to a prevailing complainant. We have recognized that the provisions of the Fair Employment Act do not expressly refer to an award of attorney's fees. Yanta v. Montgomery Ward & Co., Inc., 66 Wis.2d 53, 62-63, 224 N.W.2d 389 (1974). LIRC cites Yanta as authority for the proposition that the provisions of the Act do not confer upon DILHR the power to award reasonable attorney's fees to a prevailing complainant. We do not agree that Yanta supports that proposition.

In Yanta, the plaintiff was discharged from her employment. She initially filed a complaint with DILHR, alleging a violation of the Fair Employment Act. DILHR found the discharge to be an act of sex discrimination and awarded prospective relief only, ordering the defendant to reinstate the plaintiff and to cease and desist from further discrimination. The plaintiff subsequently commenced a civil action in circuit court, alleging that her discharge was discriminatory, and seeking damages that included back pay and attorney's fees. ³ On appeal, the plaintiff argued that the provisions of the Fair Employment Act created a private civil cause of action to recover for injuries arising out of employment discrimination. The primary issue therefore was whether the plaintiff's complaint stated a cause of action.

We held that the plaintiff's complaint stated a cause of action insofar as it sought damages for lost wages while the plaintiff was unemployed. We also held that the plaintiff's right to damages was limited to the right to seek recovery for lost wages, rather than for emotional harm, harm to reputation, or attorney's fees, stating: "The statutes [the Fair Employment Act] expressly refer to harm from loss of wages; they do not refer to emotional or reputation harm or attorney's fees." 66 Wis.2d at 62-63, 224 N.W.2d 389.

The concern in Yanta, therefore, was with the narrow issue of whether the plaintiff could maintain a private civil cause of action in court under the Fair Employment Act. In deciding this issue, we looked to the express language of the Act to establish the parameters of that cause of action, including the type of damages that would be allowable in a private civil action brought in court. Yanta did not involve an action brought directly under the Act in the administrative agency statutorily authorized to hear that action. Thus, in Yanta, we did not reach the issue presented in this case of whether that agency has the power to award attorney's fees to a prevailing complainant under the language of sec. 111.36(3)(b), Stats.1975, which specifically authorizes DILHR to "order such action ... as will effectuate the purpose of this subchapter...."

We now turn to the language of the statute itself. Section 111.36(3)(b), Stats., does not expressly authorize DILHR to award attorney's fees to a prevailing complainant. However, we have recognized that an administrative agency's powers...