Court Opinion

ID: 9350656
Source: CourtListenerOpinion
Date Created: 2022-12-27 23:03:40.847609+00
Date Added: 2024-06-11T16:57:40.683612
License: Public Domain

STATE OF LOUISIANA

                           COURT OF APPEAL

                              FIRST CIRCUIT

                             NO. 2022 CA 0392

    FRANK J. DIVITTORIO, JENNIFER LEE, AND ELSBET SMITH

                                  VERSUS

                           SEALE & ROSS, PLC

                             Judgment Rendered.        DEQ 2 7 2022

                             Appealed from the
                         21" Judicial District Court
                     In and for the Parish of Tangipahoa
                             State of Louisiana
                           Case No. 2019- 0003801

           The Honorable Brenda Bedsole Ricks, Judge Presiding

Kenneth C. Bordes                  Counsel for Plaintiffs/Appellees
New Orleans, Louisiana             Frank J. Divittorio, Jennifer Lee,   and

                                   Elsbet Smith

Craig J. Robichaux                 Counsel for Defendant/ Appellant
Cameron D. Robichaux               Seale & Ross, PLC
Mandeville, Louisiana

           BEFORE: McDONALD, WELCH, AND LANIER, JJ.

Z4;
LANIER, J.

       Appellant, Seale & Ross, PLC ( Seale & Ross),         challenges the Twenty -First

Judicial District Court' s May 18, 2022 judgment in favor of the appellees, Frank

DiVittorio andElsbet Smith. The appellees, Frank DiVittorio, Jennifer Lee, and

Elsbet Smith, have filed an answer to the appeal. For the reasons that follow, we

affirm in p art, reverse in part, and render. We also grant the appellee' s answer to

the appeal, in part, and deny it in part.

                     FACTS AND PROCEDURAL HISTORY

       The plaintiffs, Mr. DiVittorio, Ms. Lee, and Ms. Smith were employed by

Seale &   Ross as associate attorneys, until they resigned in December of 2016. 1 On

January    19,    2017,   the plaintiffs    each   emailed   Seale &   Ross,   requesting

compensation they alleged was due them for their work while employed by Seale

  Ross. The emails made reference to a formula used by Scale &           Ross to compute

compensation for associate attorneys. Based on the formula, the plaintiffs claimed

their compensation was comprised of 15% of collections from cases that originated

with each attorney, plus 30 to 35% of collections from the production (or work) of

the attorney. Also, the plaintiffs claimed they were eligible at the end of the year

to receive a production bonus of 10% of collections over their expected production

potential, an amount that is set earlier in the year.

       The plaintiffs alleged they were owed " settle        up" payments, which is the

difference between collections from their expected production and their actual

production.      The plaintiffs claimed that after Seale & Ross closed its books on

2016, the amounts oftheir settle up payments could be calculated and remitted to

them. Thep laintiffs alleged that Seale & Ross did not make any further payments

to them.

 Mr. DiVittorio' s and Ms. Smith' s effective date of resignation was December 31, 2016. Ms.
Lee' s effective date of resignation was December 5, 2016.

                                               K
      The plaintiffs collectively filed a petition forjudgment against Seale &        Ross

for unpaid wages, penalties, and costs on December 4, 201 9. 2 The plaintiffs made

the aforementioned allegations, and further Claimed that Seale & Ross failed to p ay

wages pursuant to La. R. S. 23: 631, known as the Louisiana Wage Payment Act.

They alleged that Seale & Ross withheld wages in bad faith, and as a result, Seale

  Ross was liable to the plaintiffs for penalties and attorney fees.

      Trial was held on the matter on March 31, 2021. A hearing on the award of

attorney fees was held on July 19, 2021.          On September 13, 2021, the trial court

signed a judgment, which: ruled that the plaintiffs' production bonuses were non -

discretionary wages that were withheld by Seale &         Ross in bad faith; awarded Ms.

Smith $12, 828.42 in production bonus wages and $ 39, 961.       80 in p enalties; awarded

Mr. DiVittorio $3, 516. 78 in production bonus wages and $ 38, 399. 40 in penalties;

and, awarded the plaintiffs $ 43,    862. 50 in attorney fees, as well as any judicial

interest owed. 3 The trial court denied all other claims made by the plaintiffs.

      In its reasons for judgment, the trial court found that the origination bonuses

claimed by the plaintiffs were discretionary, as the attorney compensation system

of Seale &   Ross stated thatthebonus "may" be paid to associate attorneys at the

end of the year and did not fit the definition of "wages" under La. R.S. 23: 632.

However, the trial court found the production bonus was a non -discretionary wage

as defined by La. R.S. 23: 632, because the production bonus was actually a

p ayment for work done by the attorney that the attorney would reasonably have

expected to receive at the end of the year. The trial court held that Seale & Ross

owed the plaintiffs their production bonuses, and that Seale & Ross withheld these

wages in bad faith because another attorney who left emp loyment the same year as

the plaintiffs was paid his production bonus, while the plaintiffs were not.

2 The petition was fax filed. on December 3, 2019.
3 Ms. Lee was not awarded a production bonus or penalties; however, the trial court found she
was entitled to a share of the lump sum attorney fee award because of the time and work
expended by her counsel, who was also counsel for Mr. DiVittorio and Ms. Smith.

                                              3
       On September 28, 2021, Seale & Ross appealed the September 13, 2021

judgment. The plaintiffs answered the appeal on April 18, 2022. On May b, 2022,

this Court issued a Rule to Show Cause Order in response to the September 13,

2021 judgment because it lacked proper decretal language because it did not

adequately identify the name of the party in whose favor the relief was awarded.

See D' Luca v. Kirkland, 2020- 0713, 0714 ( La. App. 1 Cir. 2119121), 321 So. 3d

4111 413. The trial court supplemented the record with an amended judgment

signed May 18, 2022, which rectified the decretal language by sp ecifying to which

parties the relief was rewarded. Although the record had already been lodged with

this Court, out of an abundance of caution to preserve their rights on appeal, the

p laintiffs filed a motion to appeal the May 18, 2022 judgment on .Tune 27, 2022. 4

                             ASSIGNMENTS OF ERROR

       Seale &   Ross asserts the following assignments of error:

       1.   The trial court erred in finding that Seale & Ross' s discretionary bonus
            system was instead mandatory and thus constituted wages. This finding
            is inconsistent with the trial court' s finding that each plaintiff s terms of
            employment regarding comp ensation made clear that all bonuses were at
            the employer' s discretion, and that Seale & Ross had declined to pay the
            bonuses. Thus, the moneyjudgmentinfavor ofMr. DiVittorio and Ms.
            Smith is erroneous. In reaching this erroneous conclusion, the trial court
            committed numerous legal errors in interpreting the plain language of
            Seale & Ross' s bonus system.

       2.   After concluding that the bonuses were wages, the trial court further
            erred in finding that bonuses, which could only have come due several
            weeks after the end of plaintiffs' employment, were " then due under the
            terms   of employment"        at the time of the plaintiff's'   terminations.

            Therefore, that portion ofthe judgment which awarded attorney fees and
            penalties is erroneous because to support an award of attorney fees and
            penalties, thewages must bethen dueunder the terms of employment at
            the time of termination as required under La. R.S. 23: 631.

       3.   The trial court erred in awarding penalty wages under La. R. S. 23: 632.
            That statute only allows penalty wages when an employer' s dispute of a
            wage claim is not made in good faith. Seale & Ross relied on its written
            procedures that had been in effect for many years, the controlling legal

4 The petition was fax filed on June 20, 2022.

                                                 4
           precedents, and the advice of outside counsel rejecting the plaintiffs'
           demandsfor bonus payments.       Any finding that Seale &    Ross was not

           acting in good faith is manifestly erroneous.

      4.   Even if the trial court was correct in awarding penalty wages, the trial
           court erred in calculating the 90 -day wage p malty. The calculation ofthe
           penalty wages in the judgment used a 22 -day month to compute the daily
           wage rate, then used a 30 -day month in calculating the penalty. Also, the
           trial court improperly calculated the plaintiffs' daily wage rate.
           Application of the incorrect methodology and errors in calculations
           render the judgment erroneous.

       Additionally, in their answer to the appeal, the plaintiffs request that this

Court reverse the trial court' s finding that the origination bonuses were

discretionary, and instead, find thatthe origination bonuses were non -discretionary

wages improperly withheld pursuant to La. R. S. 23: 631, etseq. The plaintiffs also

request that Seale &       Ross be cast with all costs and attorney fees incurred in

conjunction with the instant appeal, pursuant to La. R. S. 23: 631, et seg.

                               STANDARD OF REVIEW

       A trial court' s determination of the existence or nonexistence of an oral

contract is a finding of fact governed by the manifest error or clearly erroneous

standardof review.        Steve Owens Construction, Inc. v. Bordelon, 2017- 1320 ( La.

App. 1 Cir. 2/ 27/ 18),   243 So. 3d 601, 604. An appellate court cannot set aside a

trial court' s factual findings in the absence of manifest error or unless those

findings are clearly wrong. Rosell v. ESCO, 549 So. 2d 840, 844 (La. 1989).     If the

factual findings are reasonable in light of the record reviewed in its entirety, an

appellate court may not reverse, even if convinced that, had it been sitting as the

trier of fact,   it would have weighed the evidence differently.         Steve Owens

Construction, Inc., 243 So. 3d at 604- 05.

                                      DISCUSSION

       When claiming the existence of an oral contract for the payment of money

above $    500. 00 in value, the party claiming such must prove the existence and

terms of the contract by at least one credible witness and other corroborating

                                             5
circumstances.      La. C. C. art. 18465; Seale & Ross, P.L. C. v. Holder, 2019- 1487

 La. App. 1 Cir. 813120), 310 So. 3d 195, 200. In proving the existence of an oral

contract, a party in the litigation may serve as his or her own witness in fulfilling

the requirements of La. C. C. art. 1846.          Seale & Ross, P.L. C., 3 1. 0 So. 3d at 200.

With regard to an oral contract, a plaintiff may offer his or her own testimony in

supportof his or her claim; however, the other circumstances that corroborate the

claim must come from a source other than the plaintiff. Id., at 200- 01.                 The other

corroborating circumstances need only be general in nature and independent proof

of every detail of the agreement is not required.            Id., at 201.

       Initially, we note that Seale & Ross admitted that the employment contracts

it had executed with the plaintiffs were unwritten, oral contracts, even though the

policies outlining the associate attorney compensation systcm and bonus system

were   written.   The employee handbook, which was emailed to all associate

attorneys on June 19, 2015, gave an explanation of the bonus program and stated

that a memo concerning the current bonus philosophy was available upon request.

Only Ms. Lee requested the memo concerning the bonus philosophy, but testified

she never received it. The plaintiffs acknowledged that they were advised by the

partners about the associate attorney compensation system that was used in

calculating their salaries. All parties acknowledged these oral contracts through

their own testimony, which is corroborated by the employee handbook and

compensation system, thereby satisfying the requirements of La. C. C. art. 1846.

       The record reflects that firm partners would meet annually with the associate

attorneys, around the beginning of each year, where an agreement was reached

5 Louisiana Civil Code article 1846 states:
               When a writing is not required by law, a contract not reduced to writing,
       for a price or, in the absence of a price, for a value not in excess of five hundred
       dollars may be proved by competent evidence.

               If the price or value is in excess of five hundred dollars, the contract must
       be proved by at least one witness and other corroborating circumstances.

                                                 0
concerning the associate' s salary for the next year, as well as bonuses to be paid at

the end of that year. The proposed salary andbonuses would then be voted on by

all the partners.

       The definitions of" origination bonus" and "production bonus" are contained

in a document titled "       Associate Attorney Compensation System,"               which was

submitted as evidence by Seale &           Ross. However, none of the plaintiffs recalled

receiving that particular document. Regardless, the record shows that the plaintiffs

were aware ofhow their rates of compensation and bonuses were calculated and

distributed. The only information regarding bonuses that the plaintiffs admitted

receiving was contained in the employee handbook.                   The handbook describes the

bonus program as follows:

                 W] e have a bonus program structure that may actually allow
       additional      compensation        should       you [   exceed job requirements].
       While this programis discretionary to the firm and must dependon an
       evaluation by the partners of the firm of its ability to pay any
       bonuses[,] we make every effort to reward performance in excess of
       the requirements with recognition in form of a bonus.                    White not
       guaranteed, our track record has been quite good in rewarding such
       performance, A memo outlining the firm' s current attorney bonus

       philosophy is available upon request.

        The plaintiff's claimed in their petition thatthealleged bonuses that Seale &

Ross withheld from them were actually wages that were due pursuant to La. R. S.
                   6
23: 631 et seq.        As such, the plaintiffs argue, the wages due them were not

discretionary bonuses. In its reasons for judgment, the trial court analyzed both the

production bonuses and the origination bonuses to determine whether they were

wages due the plaintiffs or discretionary bonuses.

6 Louisiana Revised Statutes 23: 63 1 ( A)(1)( b) states:
        Upon the resignation of any laborer or other employee of any kind whatever, it
        shall be the duty of the person employing such laborer or other employee to pay
        the amount then due under the terms of employment, whether the employment is
        by the hour, day, week, or month, on or before the next regular payday for the pay
        cycle during which the employee was working at the time of separation or no later
        than fifteen days following the date of resignation, whichever occurs first.

                                                    7
      Based on the employee handbook emailed to all associate attorneys on June

19, 2015, the plaintiffs would have seen that bonuses were characterized as

discretionary. Although it is not clear whether the plaintiffs received written

definitions of origination and production bonuses, those definitions, as written in

the Associate Attorney Compensation System document, are as follows:

      Origination Bonus
      The firm may pay a bonus of 15% annually on deposited fees from
      files    on     which      the   attorney       is   the   originating   timekeeper.

      Approximately one half of this will be advanced to each attorney
      throughout the year (i.e, 1/ 2411, of the firm' s estimate of one-half of the
      total bonus will be paid at each pay period throughout the year)...               For
      attorneys with more than one year with the firm, the estimate used is
      the actual Originated Fees amount from the Tabs report for that
      timekeeper during the last completed calendar year.

      The Actual Originated Fee amount will be determined each January
      for the previous year, and any remaining unpaid bonus amount from
      the previous year will be considered each January for payment as a
      discretionary bonus.

      Production Bonus

      If an attorney exceeds his or her Deposit Requirements for the year
      the firm may pay a Production Bonus rewarding this achievement.
      The bonus is calculated as follows:
               1.    The attorney' s actual deposited fees arc used to recalculate
                     what that attorney' s base salary would have been based on
                     the actual total deposits. ( The actual deposits may entitle the
                     attorney to a higher or lower percentage of total fees than the
                     estimate used, etc.)

               2.    From this recalculated amount we subtract the base salary
                     actually] paid to the attorney. This difference is the amount
                     an attorney has exceeded his or her Requirement.
               3.    This difference is multiplied by 110% to arrive at            the total
                     Potential Production Bonus[.]
               4.    This Bonus is considered each January after actual financial
                     data from the previous year has been finalized.

      As      part    of the     Production   Bonus,        we review     actual    deposit
      performance         each   quarter,   and we will advance one half of any
      overage, up to $ 1, 000.00 at the end of each quarter. This amount will
      be subtracted from any annual Production Bonus payable; but once
      this quarterly payment has been paid it will not be due back to the
      Firm in the event that your actual bonus amount is less than the
      amount already paid out.

                                                  0
         The trial court noted that origination. bonuses " may" be given to attorneys

who are the originating timekeepers on new files. The trial court compared the

origination bonus system to the profit-sharing system found in Foshee v. Georgia

Gulf'Chemica& & Vinyls, L.L. C., 2009- 0530 (La. App. 1 Cir. 10/ 21109),       2009 WL

6316254 (unpublished opinion), affirmed, 2009- 2477 (La. 7/ 6/ 10), 42 So. 3d 346. )

In Foshee, this Court held that an employee with performance issues was not

entitled funds pursuant to his employer' s profit-sharing plan. The profit- sharing

plan was an incentive plan which was tied directly to the company' s operating

results and individual performance with no guarantee of payment and the

employee' s performance was deficient enough to lead to his termination. Foshee,

2009 WL 6316254 at * 5.

         In the instant case, the trial court found that the origination bonus, based on

its structure, was designed to incentivize attorneys to bring in new business. It was

not based on the attorney' s salary or later work done by the attorney on those new

files.   The trial court therefore determined that the origination bonus was not a

 wage"     and was wholly discretionary on the part of Seale & Ross. Finding no

manifest error in this conclusion, which is reasonably supported by the record, we

will not disturb the trial court' s ruling on this issue.   SceRosell, 549 So. 2d at 844.

As such, that portion ofthe plaintiffs answer to the appeal requesting reversal of

the trial court' s judgment as to the characterization of the origination bonus as

discretionary is denied.

         As to the production bonus, the trial court compared that bonus to the bonus

discussed in Williams v. Dutchtown Pharmacy, L.L. C., 2008- 2559 (La. App. 1 Cir,

9/ 11/ 09), 24 So. 3d221. In Williams, the plaintiffprovidedprofessional services to

the defendant, and, following his termination, filed suit against the defendant for

unpaid wages and bonus pay.        Id., at 223.   The defendant argued that the bonus

was discretionary.       The trial court found that the bonus was actually non -

                                             Z
discretionary because it was payable on a formula based on a percentage of total

sales for the year. Id., at 227,    Therefore, the plaintiff was entitled to pay based

uponthe formula andthe defendant' s gross sales receipts. Id., at 226. This Court

found that the trial court' s reasoning was not manifestly erroneous.     Id., at 227.

       Likewise, we do not find the trial court manifestly erred in its determination

that the production bonuses were actually wages.            Similar to Williams, the

plaintiffs' production bonuses were based on a formula. The bonus would be paid

at 110%   of the difference between the amount ofcollections the attorney agreed to

produce at the beginning of the year and the amount of collections the attorney

actually produced at the end of the year. The explanation ofthe production bonus

considers the attorney' s actual production in a recalculation ofhis or her salary.   A

salary,   or " wage,"   as defined by Black' s Law Dictionary,     111h Ed. ( 2019), is

 Payment for labor or services, [ usually]        based on time worked or quantity

produced; [specifically], compensation of an employee based on time worked or

output    of production." (    Emphasis added)_    As in Williams, we conclude the

production bonus in the instant case is based on actual work performed by the

plaintiffs, making it a non -discretionary wage. We will therefore not disturb the

trial court' s factual finding that the production bonuses were non -discretionary

wages.    See Rosell, 549 So. 2d at 844.

       In finding that the productionbonus was a non -discretionary wage, the trial

court then had to determine if the wage was due and owing. Pursuant to La. R. S.

23. 631( A)( 1)( b), Scale &   Ross had to pay the plaintiffs the amount that was due

them at the time of their resignation, underthc terms of their employment. Seale &

Ross argues that, since the plaintiffs resigned prior to the end of 2016, they were

not owed the productionbonuses, which were paid in January of 2017.           Like the

trial court, we disagree.      The record is abundantly clear that production bonus

wages were determined by collections made throughout the year; therefore, a

                                             10
production bonus wage was typically not p aid until January of the following year.

Desp ite the timing of the p ayment, the p roduction bonus wages in question related

to the work doneby the plaintiffs during 2016, up until their resignations.         If the

plaintiffs have not been paid for work they had done in 2016, that payment is due

and owing.

         The wages were due to plaintiffs on or before their next regular payday after

resignation, or no later than fifteen days following resignation, whichever came

first. La. R. S. 23: 631 ( A)( 1)( b). As it is clear that the plaintiffs were never paid,

the trial court had to make a determination, under La. R. S. 23: 632, as to whether

Seale &    Ross withheld payment in good faith. In order for the employer to be held

liable for penalty wages, the employer' s actions musthavebeen motivated through

bad faith, or he must be found to have acted in an arbitrary or unreasonable manner

given the circumstances.      Leprettre v. RCS, LLC, 2016- 0382 ( La. App. 3 Cir.

11/ 16/ 16), 206 So. 3d 1215, 1220. The trial court noted that while the plaintiffs

were not paid the purported production bonus wages, another attorney, Patrick

Reso, who also resigned in 2016 around the same time as Ms. Lee, was paid both a

production bonus and an origination bonus.

         Whether or not there is an equitable defense to penalty wages depends on the

particular facts ofeach case. Leprettre, 206 So. 3d at 1220, quotin       Pace v Parker

Drilling Co. &     Subsidiaries, 382 So. 2d 988, 990 (    La. App.    1 Cir. 1980),      writ

denied, 383 So. 2d 1016 ( La, 1980). A trial court' s determination of whether an

employer is arbitrary or in bad faith for purposes of imposing penalty wages is a

question of fact and is, therefore, subject to the manifest error standard ofrevicw.

Scarbrough v. LynmarHoldings, LLC, 2021- 1566 ( La. App.            1 Cir. 8/ 31/ 22),

So. 3d       12022   WL 3905772, * 2, writ denied, 2022- 01474 ( La. 11122122),

So. 3d ,       2022 WL 17101472.

                                            it
      At trial, the plaintiffs submitted into evidence an email dated March 16,

2017 from Kenneth Ross, then a partner at Seale & Ross, to Mr. Reso, which

confirmed that Scale &       Ross owed Mr. Reso money for his collections and

originations for the year 2016. Mr. Ross informed Mr. Reso that he would receive

a check for $ 10, 560.07   as final p ayment. At trial, Mr. Ross testified that Mr. Reso

was also a partner at Seale &       Ross at the time he resigned in 2016. He also

testified that Seale &   Ross traditionally has not paid bonuses to employees after

they left the firm.

       Leslie Bolner, another partner at Seale &       Ross, testified at trial that Mr.

Reso did not receive bonuses for 2016; rather, he was paid for work he had done in

2016 with "funds that came in the next year." While the email from Mr. Ross to

Mr. Reso does not classify the payment as a bonus, the email does state that the

payment is for " the collection side as well as the origination side." Regardless of

whether Seale &   Ross considered the funds due Mr. Reso to be a bonus, the funds

were due to Mr. Reso for work he performed in 2016. Since wages are equivalent

to the amount then due under the terms of employment, Mr. Reso received a wage

after resigning from Seale & Ross, while, the plaintiffs did not.      See Slaughter v.

Board ofSup' rs of Southern University and Agr. and Mechanical College, 2010-

1049 ( La. App.    1 Cir. 812111), 76 So. 3d 438, 450, writ denied, 2011- 2110 ( La.

1113/ 12), 77 So. 3d 970.

       Seale &   Ross established at trial that at the start of 2016, the firm was

experiencing cash flow issues and wouldhave to pay substantially lower bonuses

to its employees. In January of 2017, at the meeting of partners, partner Glen

Galbraith moved that "       discretionary bonuses"    be denied to the plaintiffs and

Patrick Reso, and the motion passed. Mr. Galbraith testified at trial that his

reasoning behind the motion was to " figure out how to find enough money to pay

bonuses to the people that were still there."     Despite the motion passing, Mr. Rcso

                                             12
was nevertheless paid for his work, while the plaintiffs were not. Despite the cash

flow issues, it would have been possible for Seale &              Ross to pay bonuses to all its

attorneys, even though the bonuses would have been reduced.                       We therefore

conclude the trial court did not manifestly err in finding Seale &            Ross' s refusal to

pay bonus wages to the plaintiffs to be arbitrary and unreasonable.

       Because we affirm the finding that Seale &             Ross did not act in good faith,

the plaintiffs were entitled to penalty wages pursuant to La.                     R. S.   23: 632. 7

Therefore, we must next determine if the trial court correctly calculated the p enalty

wages assessed against Seale & Ross. Pursuant to the evidence submitted, Ms.

Smith was awarded $ 12, 828. 42 in owed production bonus wages and $ 39, 961. 80

in penalties (plus judicial interest). Mr. DiVittorio was awarded $3, 516. 78 in owed

production bonus wages and $ 38, 399. 40 in penalties ( plus judicial interest).

Because the evidence indicates there was no excess salary tobepaid to Ms. Lee at

the end of 2016, she received no award for unpaid wages.

       Pursuant to La. R. S. 23: 632( A), penalty        wages axe to be assessed at ninety

days' wages at the employee' s daily rate of pay, or else full wages from the time

the emp loyee' s demand for p ayment is made until the emp loyer shall p ay or tender

7 Louisiana Revised Statutes 23: 632 states, in pertinent part:
       A. Except as provided for in Subsection B of this Section, any employer who
          fails or refuses to comply with the provisions of [ La.] R. S. 23: 631 shall be
          liable to the employee either for ninety days wages at the employee' s daily
           rate of pay, or else for full wages from the time the employee' s demand for
           payment is made until the employer shall pay or tender the amount of unpaid
           wages due to such employee, whichever is the lesser amount of penalty
           wages.

       B. When the court finds that an employer's dispute over the amount of wages due
           was in good faith, but the employer is subsequently found by the court to owe
           the amount in dispute, the employer shall be liable only for the amount of
           wages in dispute plus _judicial interest incurred from the date that the suit is
           filed. if the court determines that the employer's failure or refusal to pay the
           amount of wages owed was not in good faith, then the employer shall be
           subject to the penalty provided for in Subsection A of this Section.

       C. Reasonable attorney fees shall be allowed the laborer or employee by the
           court which shall be taxed as costs to be paid by the employer, in the event a
           well-founded suit for any unpaid wages whatsoever be filed by the laborer or
           employee after three days shall have elapsed from time of malting the first
           demand following discharge or resignation.

                                                  13
the unpaid wages, whichever is lesser. Ms. Smith' s and Mr. DiVittorio' s initial

demands to Seale &   Ross for p ayment ofunp aid wages was made on January 19,

2017, via email. The initial judgment ordering payment of unpaid wages was

signed September 13, 2021.         Ninety days'    wages will therefore be the lesser

amount of penalty wages.        Ms.    Smith' s base yearly salary for 2016 was

 71, 23$. 48, and Mr. DiVittorio' s was $ 89, 319. 60.    However, due to the actual

collections attributedto each attorney, Ms. Smith' s " shouldhavebeen" salary was

 96, 565.00, andMr. DiVittorio' swas $ 99, 950. 00. Since the " should have been"

salary reflects what Seale &   Ross deemed as the actual value of the plaintiffs'

work and therefore constitutes a "     wage",     these salaries are to be used in the

calculation for penalty wages rather than the base salaries.

      Seale &   Ross argues the trial court incorrectly used a 22 -day month to

calculate the daily wage rate, then used a 30 -day month to calculate the penalty

wages.    The trial court adopted the formula found in Wortham v. Acadia

Healthcare, LLC, 201.4- 0718 (La. App. 3 Cir. 3118115), 160 So. 3 d 602, 608, writ

denied, 2015- 0767 (La. 611115),   171 So. 3d 264 ( salary divided by twelve months

divided by twenty-two working days in a month times ninety).       W c find this to be a

reasonable formula for calculating penalty wages and will not disturb it.         In so

calculating, however, we find the trial court made an error in its calculation.    Ms.

Smith' s " should have been" salary of $96, 565. 00, divided by twelve, divided by

twenty-two, then multiplied by ninety equals $ 32, 919. 89.   Mr. DiVittorio' s " should

have been" salary of$99, 950.00, divided by twelve, divided by twenty- two, then

multiplied by ninety equals $      34, 073. 86.   We therefore amend these awards

accordingly.

       As to attorney fees, La. R.S. 23: 632( 0) mandates an award of reasonable

attorney fees in the event that a plaintiff files a "   well- founded" suit for unpaid

wages.   See Kern v. River City Ford, Inc., 98- 0407 (La. App. 1 Cir. 2/ 19199),    754

                                           14
So. 2d 97$, 985. A suit is considered" well- founded" when the employee brings a

successful suit and recovers unpaid wages.             Haber v. Ocean Canyon Properties,

Inc.,   2017- 1472 ( La. App. 1 Cir. 5131118), 251 So. 3d 454, 460.

         A hearing on attorney fees was held before the trial court on July 19, 2021,

following an objection by Seale & Ross to the amount of attorney fees requested

by the plaintiffs. Specifically, Seale & Ross objected to any attorney fees being

owed to Ms. Lee, since she did not recover wages in her lawsuit. The trial court

nevertheless initially awarded a lump sum attorney fee of $47, 850. 00, which was

159. 5 hours of work at $ 300 an hour. The fee agreement between plaintiffs and

their counsel was 40 p ercent oftotal recovery or statutory attorney fees, whichev er

was greater."    The trial court reasoned that although Ms. Lee did not recover, she

was essentially a witness for the other two p laintiffs, and by prep wring Ms. Lee' s

case for trial, she was also prepared as a witness. The court then reduced the one-

third of the attorney fee attributable to Ms. Lee by twenty- five percent.9

         We disagreethat Ms. Lee should share in the award of attorney fees.                   Her

suit does not meet Haber" s definition of "well- founded," since she did not recover

unpaid wages, and therefore, she is not entitled to attorney fees. Although the trial

court did not state the exact amount of attorney fees it attributed to Ms. Lee, the

trial court' s calculation appears to be twenty- five p ercent of one third of the lump

sum award ($47, 850. 00).       We find the trial court abused its discretion in awarding

attomeyfees to Ms. Lee.         We find it reasonable to award two- thirds of the lump

sum,     one third attributable to Ms. Smith and one third attributable to Mr.

DiVittorio, bringing the total award ofattorney fees to $ 31, 900.00.             In addition, we

grant the plaintiffs' answer to the appeal, in part, and award $4, 000.00 in attorney

fees in conjunction with the instant appeal to Ms. Smith and Mr. DiVittorio.

8 The lump sum of $47,850. 00 is the greater number.
4 In following the trial court' s mathematical rationale, the resulting attorney fee award should be
 43, 619.58. However, the trial court awarded $ 43, 862. 50 in attorney fees.

                                                 15
                                       DECREE

       The judgment of the Twenty -First Judicial District Court, insofar as it

awards unpaid wages in theamountof$ 12, 828. 42to Elsbet Smith and $ 3, 516. 78

to Frank DiVittorio, is affirmed. The district court' s award ofpenalties is amended

to $32, 919. 89   in favor ofMs. Smith and $ 34,073. 86 in favor o fMr. DiVittorio, and

affirmed as amended. The district court' s award of attorney fees is reversed, and is

this Court renders an award of $31, 900. 00 in attorney fees in favor of Ms. Smith

and Mr. DiVittorio only. We partially grant the appellee' s answer to the appeal,

and   award $     4, 000. 00 to Ms. Smith and Mr.     DiVittorio in attorney fees in

conjunction with this appeal.        Costs of this appeal are assessed against the

appellant, Seale & Ross, PLC.

       AFFIRMED          IN   PART,     REVERSED        IN   PART;     RENDERED;
ANSWER TO APPEAL GRANTED IN PART AND DENIED IN PART.

                                            E