Service Award (Incentive Award)

A service award, sometimes called an incentive award, is an additional payment that parties may ask a court to approve for a named plaintiff or class representative based on work, time, or burdens connected with representing a class.

It is separate from the ordinary settlement benefit available to eligible class members. A class representative may communicate regularly with counsel, help collect records, answer discovery requests, sit for a deposition, review settlement terms, or take on other responsibilities during the case. A request for a service award may describe those contributions, but the proposed payment is not automatic.

The judge reviewing the settlement decides whether an award is legally permitted and appropriate. Courts may consider the representative’s contribution, the requested amount, the effect on the settlement fund, and whether the payment could create a conflict with other class members. The Northern District of California’s settlement guidance says judges in that district have different perspectives on extra payments to class representatives. It asks parties seeking an award to describe the request and supporting evidence and to ensure that its size or conditions do not undermine the representative’s adequacy.

The availability of service awards also varies by jurisdiction. The Eleventh Circuit’s decision in Johnson v. NPAS Solutions held that the type of incentive award at issue was prohibited under binding precedent. Other courts may permit a properly supported request, subject to their governing law and review of the particular settlement.

A regular class member does not receive a service award merely by submitting a claim. The payment is considered only for a person serving in a representative role, and the settlement notice may list the proposed amount separately from class member benefits, attorneys’ fees, administration costs, and other deductions. Whether it comes from the common settlement fund or another source depends on the agreement and approval order.

If a notice lists a service award, remember that the amount shown may still be a request rather than a final award. The final approval materials and court order will show what the judge approved.