I think you should talk to another lawyer and see if they would be willing to take your case on a contingency fee and also represent you on the BS (as you state) counter lawsuit. I think a lawyer would need to hear all the details of the case to determine if they would be interested in stepping in the case. I'm assuming as an apartment manager you were provided a reduced rate apartment but you were not paid minimum wage (which would be labor code violation). Talk to a lawyer over the phone and provide them more details about what the claims you are being sued for.
No doubt you had a deal with your lawyer whereby the lawyer agreed to prosecute your wage claim for a percentage of the recovery on that claim. A counterclaim in a case like yours is likely unrelated to the wage claim and is based on some other legal basis for the former employer to sue you, like property damage or fraud. Your original agreement with your lawyer probably never promised to prosecute your wage claim AND defend you against an unrelated cross-complaint. That means your attorney is not duty-bound to defend you because you have no agreement in that regard.
It is unreasonable to expect that an attorney will prosecute your claims for one negotiated amount, and then when a counterclaim comes along to expect the attorney to defend that claim for free, i.e., for the same money, unless it was part of your original deal.
Your bottom line is this: you need to defend against the counterclaim even if it is BS. If you do not, you will default and lose. You need an attorney to defend you against that claim. You either retain and pay your present attorney to do that, or you retain and pay someone else to do that.
Your alternative is to settle now to avoid the cost of defending the cross-complaint. The settlement will not be for what you want because you now have to deal with the defense and exposure of the cross-complaint.
You are in a tight spot, but you need to decide what you want to do. It is not reasonable to expect your present attorney to simply defend the new claims for no additional money.
Good luck to you.
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Your lawyer is definitely not required to defend you on the counterclaim free of charge. It's impossible to say how much of an overlap there is between the two claim, and how much extra work the counterclaim will require -- though it will clearly require some.
I assume you have no insurance that would provide a defense on the counterclaim.
It sounds like you need to be aggressively looking for other counsel, negotiating an arrangement with current counsel on representation for the counterclaim, or settling this case.