Know Your Rights: California Supreme Court Clarifies Cost-Shifting Rules Under CCP § 998
Protecting Employees from Costly Legal Traps – WorkRight Law, APC Is Here to Help
What Happened?
On March 20, 2025, the California Supreme Court issued a significant decision in Madrigal v. Hyundai Motor America, Case No. S280598. The Court clarified that under California Code of Civil Procedure Section 998, if a plaintiff rejects a settlement offer and later settles for less—even before trial—they may be liable for the defendant’s post-offer costs.
Why This Matters to You
If you’re an employee considering legal action against your employer for violations such as discrimination, harassment, or wage theft, understanding Section 998 is crucial. Employers can use this statute to pressure you into accepting low settlement offers by threatening you with the risk of paying their legal costs if you don’t secure a better outcome.
Understanding Section 998
Section 998 is designed to encourage settlement by penalizing parties who reject reasonable offers. If you refuse a settlement offer and later obtain a less favorable result, you may be responsible for the other party’s costs incurred after the offer was made.
How Employers Use Section 998
Employers may strategically use Section 998 offers to minimize their liability. By making an early settlement offer, they create a risk for you: if you reject the offer and don’t achieve a better result, you could be on the hook for their post-offer costs. This tactic can deter employees from pursuing valid claims.
WorkRight Law, APC Is Here for You
At WorkRight Law, APC, we specialize in representing employees in disputes against their employers. We understand the complexities of Section 998 and can help you navigate these challenges. Our team is dedicated to ensuring that your rights are protected and that you’re not unfairly burdened by legal technicalities.
Take Action Now
If you’re facing workplace violations and are concerned about the implications of Section 998:
Consult with Us: Before responding to any settlement offers, let us review them to ensure your interests are safeguarded.
Know Your Rights: We’ll educate you on how Section 998 works and how it may impact your case.
Strategic Representation: Our attorneys will develop a strategy that considers all legal nuances, including potential cost-shifting provisions.
Contact WorkRight Law, APC Today
Don’t let legal complexities deter you from seeking justice. Reach out to WorkRight Law, APC, for a consultation. We’re committed to standing by your side and advocating for your rights.
