Altice, J.
Case Summary
Family Dental Care, P.C. (Family Dental) breached its employment contract with Christine Mousa, DDS (Dr. Mousa) and, in bad faith, failed to pay her wages that were due of nearly $23,000. The parties stipulated below that, prior to Family Dental’s termination of the employment contract, Dr. Mousa had earned such wages. Following a bench trial, the trial court awarded Dr. Mousa damages in the amount of $94,465.82, which included unpaid wages plus prejudgment interest, other damages related to the premature termination of the contract, and liquidated damages. The trial court, however, denied Dr. Mousa’s request for attorney fees.
On appeal, Family Dental challenges only the award of $45,995.24 in liquidated damages. Family Dental argues that Ind. Code § 22-2-5-2, which provides for statutory liquidated damages for an employer’s bad faith failure to pay wages, was inapplicable because Dr. Mousa failed to submit her claim to the Indiana Department of Labor (the DOL) before filing suit. Dr. Mousa responds that exhaustion of administrative remedies here would have been futile because her claim for unpaid wages exceeded the $6,000 threshold for processing by the DOL. Thus, Dr. Mousa contends that the trial court properly awarded statutory liquidated damages and, on cross appeal, argues that the trial court was required to also award attorney fees under I.C. § 22-2-5-2.
We affirm in part, reverse in part, and remand.
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Although the trial court’s order does not reference any statute, it is apparent, and the parties agree, that the liquidated damages were awarded under I.C. § 22-2-5-2. This statute, commonly referred to as the Wage Payment Statute…
Because Dr. Mousa was terminated by Family Dental, her wage claim, filed after her involuntary separation, clearly fell under the WCA, and her suggestion to the contrary is without merit. See Hollis, 941 N.E.2d at 540. Further, Dr. Mousa stipulated below that she failed to file a claim with the DOL prior to filing her complaint with the trial court. [Footnote omitted.] Dr. Mousa argues, however, that her claim would have been automatically denied by the DOL because it exceeded $6,000 and, thus, “exhausting her administrative remedies was not only futile, but administrative remedies were unavailable.” Appellant’s Brief at 5. Accordingly, Dr. Mousa claims that she was entitled to take her wage claim straight to court and seek attorney fees and liquidated damages under the Wage Payment Statute. We cannot agree.
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The fact that Dr. Mousa’s claim exceeded $6,000 does not negate the need for a letter of referral for her counsel to seek redress for her under the Wage Payment Statute…
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We share the dissent’s concern regarding the imprecise language used by the DOL on its online wage claim form, which indicates that the DOL cannot accept or process claims in excess of $6000. This is misleading to a lay person, and the DOL should clarify that while it is not permitted by law to take assignment of such claims for administrative resolution, it can still investigate and refer the claims to the attorney general for initiation of civil action by the attorney general or a private attorney designated by the attorney general. Regardless, however, the statutory language is clear – in the context of the WCA, only the attorney general or the designee of the attorney general may proceed under the Wage Payment Statute.
In sum, we find Dr. Mousa’s futility argument unavailing. Liquidated damages and attorney fees under the Wage Payment Statute were not available to her because she bypassed the DOL, resulting in her attorney never being designated by the Attorney General to seek such relief. Thus, we conclude that the trial court erred in awarding liquidated damages to Dr. Mousa but that it properly denied her request for attorney fees. On remand, the trial court is directed to reduce the damages award accordingly.
Judgment affirmed in part, reversed in part, and remanded.
Mathias, J., concurs. Bailey, J., dissents with opinion.
Bailey, Judge, dissenting.
I agree with the majority opinion, as far as it goes. That is, it is clear that the Wage Claims Act (“WCA”) applies to Mousa’s wage claim because she was involuntarily separated from her employment. [Footnote omitted.] See, e.g., Walczak v. Labor Works-Ft. Wayne LLC, 983 N.E.2d 1146, 1149 (Ind. 2013). It is also clear that the WCA requires that claimants exhaust their administrative remedies by filing their claims with the Indiana Department of Labor (“the DOL”) before filing a lawsuit seeking payment of their claims. Id.; Ind. Code § 22-2-9-4; see also 610 Ind. Admin. Code 6-2-2 (regarding initiation of an investigation). However, as a matter of equity, I would affirm the trial court’s order awarding Mousa liquidated damages because it would have been futile for her to seek an administrative remedy, as shown by the uncontested fact that the DOL refuses to even accept for processing any wage claim over $6,000.00. And, for the same reason, I would reverse the trial court’s denial of Mousa’s attorney fees and costs.
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