EEOC Remains Active/ Highly Aggressive in 2016

Already this year, the EEOC has introduced two very significant measures that are sure to delight plaintiff lawyers while causing serious concerns for employers and their management-side attorneys, including your friends here at Wessels Sherman.  The more troublesome new measure is the EEOC’s proposal to significantly modify the information employers must report each year as part of the agency’s EEO-1 reporting requirements.  Specifically, starting in September of 2017 the proposal is to require employers to include additional information in their annual EEO-1 reports to the government, setting out pay ranges and hours worked for their employees.  It takes little imagination to think of how a federal governmental agency such as the EEOC might use this kind of information if employers are made to disclose it, annually.  Another new proposal involves new guidelines on retaliation prohibited under the various laws administered by the EEOC, such as Title VII, ADA, ADEA and EPA.  These guidelines are designed to educate the public on how the EEOC views retaliation claims, which continue to be the fastest growing type of claim filed with this agency.  No doubt they also will educate more plaintiffs on how to sue.  

According to the EEOC the additional data gathered under its proposed new EEO-1 reporting requirement, would be used to assess discrimination complaints of all types (race, sex, age, disability, religion, national origin, etc.).  If in the course of such investigations it identifies any pay disparities in the employer’s EEO-1 reports, the EEOC would expand its investigation to include scrutiny of the employers wage and hour practices. Under this scenario, while investigating an individual applicant’s or employee’s charge of discrimination the EEOC would look at the employer’s EEO-1 reports for any indication of disparity among all employees regarding pay or hours worked.  The data could be used to launch a full-scale investigation into potential “systemic pay discrimination,” followed by class-action claims in the discretion of the EEOC’s investigator and Regional Director.  Obviously, if the proposal goes through and employers are required to disclose pay and hour ranges in their annual EEO-1 reports, employers can expect more lawsuits along with dissemination of information that is otherwise regarded as proprietary and confidential.  

The EEOC’s proposed revisions to its guidance on retaliation claims are the first since 1998.  This new guidance broadens the definition of the sorts of “adverse employment actions” employees can challenge as the basis for a claim of unlawful retaliation.  For instance, terminating an employee has always been regarded as the consummate unlawful “adverse employment action” if done in retaliation for an employee’s exercise of rights under Title VII, ADA, ADEA, etc.  But what if an employee claims retaliation based on less severe actions, such as denying a requested vacation, or being spoken to more harshly by a supervisor?  Different courts have addressed this question with different results and, as one might expect, the EEOC’s proposed definition is very employee friendly, and even includes non-work related actions, as long as they might deter reasonable individuals from engaging in protected activity.  In addition, the proposed new guidance attempts to usurp the role of courts to determine how evidence is weighed to prove retaliation by connecting an employee’s protected activity (e.g., complaining of discrimination, participating in an investigation, etc.) to a challenged adverse employment action.  This guidance states that an employee can discredit the employer’s explanation for taking the adverse action and show a causal connection between the protected activity and the adverse action through a “convincing mosaic” of evidence that would support a claim of retaliation.

Both of these actions are just proposals at this point, and interested employers and other parties can submit comments before any final action is taken.  Comments will be accepted on the pay data proposal through April 1, and on the retaliation proposal through February 24.  Employers are advised to use 2016 to audit in preparation for the possibility that employers may be essentially open to inspection by the federal government, in 2017.

Questions? Contact Mr. Sherman at (952) 746-1700 or at jasherman@wesselssherman.com. 

U.S. Supreme Court Rules that Courts, Not EEOC, Decide Whether the EEOC Satisfied its Legal Obligation to Attempt to Resolve Alleged Unlawful Employment Practices Prior to Filing a Lawsuit

May 2015

By: James B. Sherman, Esq.

On April 29 the Supreme Court ruled in Mach Mining, LLC v. EEOC, that the Equal Employment Opportunity Commission (EEOC) cannot police its own compliance with statutory requirements that it “conciliate” its investigative findings before it can sue employers in court.  Mach Mining involved an employer’s appeal of a very unfavorable ruling by the Seventh Circuit Court of Appeals in Chicago, which held essentially that the EEOC answers to no one in regards to whether it has satisfied its statutory obligation to explore informal resolution of claims with employers.  The Supreme Court’s decision to review this matter created great anticipation among employment attorneys and employers alike, hoping for a more favorable outcome.  Employers unfortunate enough to have found themselves pursued by the EEOC routinely find that little effort is made to avoid litigation, especially in what the agency designates as “priority cases.”  Ultimately, the Supreme Court reversed the appellate court and held that whether the EEOC has satisfied its mandate to conciliate before it litigates, is a matter for the courts and not the EEOC to decide.  While this was welcome news to employers and their legal counsel, it is tempered by the Court’s conclusion that the EEOC’s conciliation efforts are subject only to very limited review by the courts. 

The underlying facts in Mach Mining involved a woman who filed a charge with the EEOC claiming that she was not hired as a coal miner because of her sex.  After conducting an investigation, the EEOC determined that there was substantial evidence to conclude that the employer illegally discriminated against the woman and other female applicants on the basis of their sex.  The EEOC sent a letter to the employer informing it of this determination and stated that it would begin conciliation.  Approximately a year later, the EEOC sent another letter stating that conciliation was unsuccessful, and filed suit against the employer.  The Court’s decision does not state what, if anything, happened in the time between the two letters, but the employer asserted that the EEOC did not fulfill its obligation to attempt to resolve the matter before filing its lawsuit. 

Conciliation involves attempts to resolve employment claims through “informal methods” prior to resorting to litigation.  Title VII of the Civil Rights Act, which prohibits workplace discrimination and harassment on the basis of race, sex, religion, etc., as well as the ADA (disability) and ADEA (age), all contain the same mandate that when an EEOC investigation results in a finding of “substantial evidence” that a violation has occurred, the EEOC must not initiate a lawsuit until after it first conciliates with the employer in an effort to resolve the matter short of litigation.  The statutory language clearly indicates that Congress wanted the EEOC to resort to litigation as a last resort, only after first trying to resolve cases through informal means.  Although the Court held that the EEOC does not have the final word on whether or not it has fulfilled its duty to conciliate, judicial review will be extremely limited: The EEOC must inform the employer about the specific allegation, describing what the employer has allegedly done and what employee or class of employees have suffered as a result (this will generally be covered in the letter announcing that it found reasonable cause).  Additionally, the EEOC must try to engage the employer in some form of conversation to give the employer an opportunity to remedy the alleged wrong.  An affidavit from the EEOC stating that it did both of these and it was unsuccessful will generally be sufficient to show that it fulfilled its obligation to conciliate, and a court’s review is limited to determining whether these two things happened—it will not go into the substance of any conversations.

Many employers and their lawyers argue that today the EEOC has become much more litigious than in the past, as well as more aggressive in pursuing claims to court with more creative legal theories.  Is it possible now that it knows its behavior is subject to judicial scrutiny the EEOC will be ever so slightly more reasonable in conciliating claims with employers?  Time will tell.

Questions? Please contact James B. Sherman at (952) 746-1700 or jasherman@wesselssherman.com.