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EEOC Ordered to Pay Big Fees for Pursuing Criminal-History Suit

Posted by Molly DiBiancaOn October 9, 2013In: EEOC Suits & Settlements, Hiring

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The EEOC suffered another defeat this week, being ordered again to pay the fees and costs incurred by an employer after the EEOC’s claims turned out to be without merit.  IN EEOC v. Peoplemark, Inc., A split 6th Circuit affirmed an award of approximately $750,000 in fees and costs incurred by a temp agency in defending against one of the EEOC’s criminal-history cases.  The EEOC contended that the temp agency’s company-wide policy barring employment to individuals with felony records had a disparate impact on Black candidates. Attorney's fees

The temp agency, PeopleMark, had offices in five states.  In 2005, a Black candidate, Sherri Scott filed a Charge of Discrimination, alleging that she had been denied employment because she had a felony conviction.  In fact, Scott had two felony convictions and had been released from prison less than a month before she applied for a job with PeopleMark. 

And it gets worse. 

The EEOC “investigated” the Charge, issuing multiple subpoenas and obtaining more than 15,000 pages of documents.  Although the evidence did not seem to support the allegations in the Charge, EEOC disagreed and filed suit.  The suit, asserted on a class of individuals, alleged that the company's policy prohibited the hiring “of any person with a criminal record,” which disparately impacted Black applicants.

The trouble, though, was that PeopleMark did not have such a policy. Then the EEOC identified approximately 250 individuals it contended to be within the class of aggrieved persons.  Well, as it turned out, PeopleMark had hired 57 of the individuals and some others did not have a criminal background in the first place.

The EEOC eventually agreed to dismiss the case but, as you may imagine, PeopleMark was not exactly satisfied and it sought sanctions in the form of fees and costs incurred in the litigation in the amount of approximately $1.3 million. 

In March 2011, the U.S. District Court for the Western District of Michigan granted the motion and awarded approximately $750,000 in fees to PeopleMark.  On appeal, the 6th Cir. affirmed, finding that the employer was entitled to recover fees from the time that the EEOC learned or should have learned that PeopleMark did not have the policy as the EEOC had alleged.

EEOC v. Peoplemark, Inc., No. 11-2582 (6th Cir. Oct. 7, 2013).

See also

EEOC Faces Petition for $5.5m in Fees

W.D. Pa. Finds EEOC Failed to Conciliate

What Does “Good Faith” Mean to the EEOC?

When the EEOC Goes Too Far—Part 2

When the EEOC Goes Too Far

EEOC v. Ruby Tuesday

EEOC Faces Petition for $5.5m in Fees

Posted by Molly DiBiancaOn March 25, 2013In: EEOC Suits & Settlements

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Employers are wary of litigating against the EEOC. And for good reason. Many employers who have faced the EEOC in the courtroom have complained that the agency uses guerilla litigation tactics. One commonly heard complaint occurs in the context of class actions, when the EEOC refuses to disclose the identity of the claimants on behalf of whom the EEOC seeks relief.

Recently, though, some courts have heard these complaints and agreed with the employer. Different courts have reacted, differently, though. Only a few have gone so far as dismissing the EEOC’s case.

One of the first courts to take this course was the U.S. District Court in Iowa. In EEOC v. CRST Van Expedited, Inc., the EEOC filed suit on behalf of 270 female truck drivers, claiming that they were subject to a hostile work environment. The district court dismissed the claims of all but two employees. The company settled the remaining claim for $50,000.

The EEOC appealed but the 8th Circuit held that the EEOC’s failure to conduct a complete investigation and conciliation prevented it from representing certain claimants and affirmed the dismissal of the EEOC’s suit as to those employees.

With that significant victory under its belt, the employer has decided to see if it can keep its winning streak alive. On March 18, 2013, CRST filed a petition seeking $5.5 million in fees and expenses incurred in defending the EEOC’s suit. In support of its petition, the employer points to some troubling facts:

· 150 depositions were taken during the litigation;

· 115 of the 270 claimants were dismissed for failing to appear for deposition;

· 7 summary-judgment motions were filed;

· 88 claims were dismissed as meritless; and

· 67 claims were dismissed for the EEOC’s failure to conciliate.

These facts should be enough to scare any employer, although it remains to be seen whether they will be sufficient to warrant an award of fees. We’ll be sure to keep you posted.

See also

W.D. Pa. Finds EEOC Failed to Conciliate

What Does “Good Faith” Mean to the EEOC?

When the EEOC Goes Too Far—Part 2

When the EEOC Goes Too Far

EEOC v. Ruby Tuesday

EEOC Sanctioned for Failure to Produce Social-Media Evidence

Posted by Molly DiBiancaOn March 8, 2013In: EEOC Suits & Settlements, Social Media in the Workplace

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EEOC v. Original Honeybaked Ham Co. of Georgia, Inc., is the subject of today’s post. I first wrote about this case in November, when the Colorado District Court granted a motion to compel the EEOC to turn over social-media content of claimant-employees. The court acknowledged that discovery of social-media content presents “thorny and novel issues.” But, finding that the postings were relevant to the issues in the case, the court ordered that it be turned over.EEOC

In an unusual twist, the court required the EEOC to turn over the log-in information and passwords of the claimants to a special master, who would make an initial determination of discoverability. I concluded that the decision was a well-reasoned attempt to balance the individual claimants' privacy interests with the defendant-employer's right to broad discovery of potentially relevant information. Faced with these two competing interests, the court crafted a fairly complex, multi-tiered, and dynamic process for the collection, review, and production of the information from the employees' social-media accounts.

Fast-forward three months.

The employer files a motion for sanctions, alleging that the EEOC had failed to comply with the court’s order to produce the social-media data. The court granted the motion, finding that the EEOC had, in several material respects, made the discovery of claimants’ social media “more time consuming, laborious, and adversarial than it should have been.” In short, the court found that the EEOC had agreed to various discovery procedures only to later renege when the “higher-ups” at the EEOC learned about the parties’ agreement and didn’t, well, . . . agree.

In awarding the employer its reasonable attorney’s fees, the court had to use some judicial imagination, finding first that most of the sanctions rules did not apply because the EEOC had not litigated in bad faith. Instead, the discovery problems were more a result of bureaucracy, rather than intentional bad-faith tactics. Still, the court did find a rule that enabled it to award fees and, with any luck, send a strong message to the EEOC about the consequences of failing to cooperate (and keep its promises) during discovery.

No. 11-02560-MSK-MEH (D. Colo. Feb. 27, 2013).

Employees Must Turn Over Facebook Info For Harassment Claim

Discovery of EEOC Claimants' Social-Media Posts

W.D. Pa. Finds EEOC Failed to Conciliate

What Does “Good Faith” Mean to the EEOC?

When the EEOC Goes Too Far—Part 2

When the EEOC Goes Too Far

EEOC v. Ruby Tuesday

Call Me, Maybe. Discovery of Employee Identities

W.D. Pa. Finds EEOC Failed to Conciliate

Posted by Molly DiBiancaOn February 25, 2013In: EEOC Suits & Settlements

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In February 2012, the EEOC approved its Strategic Plan for fiscal years 2012-2016.  The Plan establishes a framework for achieving the EEOC's mission to stop and remedy unlawful employment discrimination by focusing on strategic law enforcement, education and outreach, and efficiently serving the public.  The second performance measure of the plan requires the EEOC to approve a Quality Control Plan. The QCP will revise criteria to measure the quality of agency investigations and conciliations throughout the nation.

The EEOC has requested input from interested parties regarding recommendations for quality indicia of investigations or conciliations or general recommendations for improving the quality of our intake process, investigations and conciliations.  The EEOC’s current interest in improving its conciliation track record likely is related to a recent string of cases challenging the sufficiency of the agency’s conciliation efforts.  One such case was issued last month by a federal court in Pennsylvania.

Background

The case began when a single employee filed a charge of unlawful discrimination based on sex and retaliation, which was later amended to allege age discrimination. The EEOC investigated the Charge, requested and received a significant amount of information from the defendant. Approximately 8 months later, the EEOC issued a Cause Finding in which it determined that the defendant had unlawfully discriminated against the Charging Party based on sex and that the defendant had engaged in a pattern and practice of discrimination based on age in 6 of its restaurants.

The EEOC advised the defendant that it would promptly seek to conciliate the dispute and sent a proposed conciliation agreement. By the time the defendant received the Determination and proposed conciliation agreement, it had only 7 days to respond.

The defendant asked for an additional 30 days to respond but the EEOC denied the request. Instead, the EEOC told the defendant that it had to provide its “best offer” within the next week. The EEOC also made its first monetary demand—approximately $6.5 million for an unspecified number of potential claimants.

The defendant made a counter-offer as to the Charging Party’s claims and an expressed willingness to engage in further negotiations. Six days later, the EEOC issued a Notice of Failure of Conciliation and, a week after that, filed suit. The parties engaged in discovery for the next three years.

The Employer’s Motions

The defendant filed a motion to dismiss and for summary judgment. In support of its motion to dismiss, the defendant argued that the EEOC’s complaint failed to allege sufficient facts as the basis for its claim. The court agreed and ordered the EEOC to file an amended complaint within 30 days.

In support of its motion for summary judgment, the employer argued that the EEOC had failed to satisfy its duty to conciliate in good faith. The court acknowledged that the EEOC had great discretion to determine the extent of efforts needed to meet this duty. Even so, the court concluded that the so-called conciliation was insufficient.

The Court’s Decision

Particularly because of the break-neck speed of the process, the court found it difficult to “discern how the EEOC’s actions here would indicate a meaningful desire to actually engage in a process of ‘persuasion,’ ‘conference’ or ‘conciliation.’” As the court explained:

By any measure, a demand for the payment of more than $6 million dollars, coupled with nine days to either say “yes” or to make a “best and final” response in these circumstances (which includes, as noted above, a demand for more than a dozen significant affirmative remedial measures) is so devoid of reasonableness as to lead this Court to the conclusion that it was not a meaningful, good faith conciliation effort.

The court went on to explain that an “exchange of pointed letters does not evidence a sincere effort to reach a meeting of minds, especially in the context of an extraordinarily short set of response deadlines which were not driven by any externally imposed deadlines.” “Conciliation by letter,” the court concluded, will “rarely constitute ‘conciliation’” but, instead, were more akin to “surface bargaining.

Although the EEOC’s efforts were so fundamentally flawed, they were not sufficient to warrant dismissal of its case. Instead, the court concluded that, to dismiss the suit, after years of discovery, would be “wholly improvident.” Instead, the better course was to require that the parties now engage in the conciliation process—a process that should have occurred sooner.

Thus, the court stayed discovery to allow the parties 45 days to engage in conciliation under the court’s supervision.

(PDF) 2:09-cv-01330 (W.D. Pa. Jan. 22, 2013).

See also:

What Does “Good Faith” Mean to the EEOC?

When the EEOC Goes Too Far—Part 2

When the EEOC Goes Too Far

Give Me Some Credit! EEOC Credit-Check Case Dismissed

Posted by Lauren Moak RussellOn February 6, 2013In: Background Checks, EEOC Suits & Settlements, Hiring

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"Give Me Some Credit!" Maybe that's how the EEOC feels these days, after its high-profile suit against Kaplan Higher Education Corp. was dismissed on January 28, 2013. As readers may remember, the EEOC sued Kaplan in 2010, alleging that its pre-employment credit check policies had a disparate impact upon Black job applicants.

In a 23-page opinion, the U.S. District Court for the Northern District of Ohio dismissed the suit on Kaplan's Motion for Summary Judgment. The Court first excluded the expert witness testimony offered by the EEOC, holding that it was scientifically unsound. Expert witness testimony is key in disparate impact cases, because they rise and fall on the percentage of job applicants from a given classification as compared to the percentage of hires in the same classification. Among the key problems for the EEOC was that Kaplan, like many employers, does not collect demographic information on the race of job applicants. As a result, EEOC struggled to identify the races of those applicants that were rejected due to credit problems. In an effort to remedy the problem, the EEOC subpoenaed records from state DMVs, and used a team of "race raters" to review the DMV photos and assign races to the job applicants. The Court, not surprisingly, rejected this approach and the resulting expert witness analysis.

Next the Court addressed Kaplan's Motion for Summary Judgment. In the absence of any statistical evidence demonstrating an adverse impact caused by the use of credit checks, the Court held that the EEOC's case had to be dismissed.

There are several interesting considerations arising out of this litigation. First, as the Court's decision noted, the EEOC itself uses credit checks to vet job applicants! This should not come as a great surprise, as many employers use credit checks as one of a litany of tools at their disposal to identify the best-qualified candidates. Nonetheless, for an agency that has widely publicized the pitfalls of background checks in the hiring process, its adoption of the practice calls its hardline stance into question.

Second, the EEOC's past enforcement practices gave rise to many of its difficulties in this case. Many employment law attorneys discourage their clients from collecting race, gender, and other protected-characteristic data during the application process. In the past, the EEOC has used such information to support disparate hiring claims. Kaplan, in complying with EEOC best practices, deprived the EEOC of information that it needed to prove its case, thereby leading to the rejected "race rater" approach.

Finally, many employment law experts and EEOC-watchers are wondering if the Court's decision will put a damper on EEOC enforcement efforts directed at background checks. As readers of this blog know, background checks have been in the EEOC's cross-hairs for quite some time, with new guidance issued on the use of criminal background checks in April 2012. In light of the hurdles faced in this case, many are speculating that the EEOC may back off of its efforts to litigate these issues, focusing instead on conciliation efforts.

Only time will tell. In the meantime, employers can rejoice in a victory for the reasoned and supportable use of pre-employment credit checks.

Who Says I'm a Girly Man? Doth Sayeth the EEOC

Posted by Molly DiBiancaOn December 27, 2012In: Discrimination, Discrimination & Harassment, EEOC Suits & Settlements, Gender (Title VII), Harassment, Harassment, Other (Title VII), Harassment, Sexual

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The EEOC has enjoyed several victories in recent months. For example, the EEOC was granted summary judgment in a hostile-environment claim filed on behalf of a class of black construction workers. Even more recently, the EEOC was awarded summary judgment in an age-discrimination lawsuit against the City of Baltimore. But things haven't been all peaches and cream for the EEOC.

In EEOC v. McPherson Cos., Inc., a federal district court in Alabama granted summary judgment to the defendant-employer in a sexual-harassment lawsuit brought by the EEOC on behalf of an unnamed male employee. The employee worked in a warehouse with an all-male workforce.

The EEOC alleged that, after being subject to a constant barrage of "ugly talk," the employee complained to his supervisor about the allegedly hostile work environment. About a year later, the employee confronted his co-workers, who apologized and, thereafter, stopped directing rude comments his way. About a year after that, the employee complained to HR, which investigated the complaint, resulting in discipline for several workers and two supervisors. After this last complaint, the comments ceased.

The court held that the EEOC had failed to establish the existence of an unlawful hostile environment because it had not shown that the rude comments and "ugly talk" were of a sexual nature or that they were made "because of" the employee's gender.

The EEOC argued that the harassment was because of his gender and, specifically, because of his effeminate behavior. This can be a valid cause of action--when a male employee is treated badly because he acts "too girly." But, here, despite the EEOC's argument, the testimony of the employee himself contradicted this argument. Thus, the court dismissed the gender-discrimination and sexual-harassment claims.

The court also dismissed the EEOC's retaliation claim. The employee was terminated, along with 11 other employees, as part of a reduction-in-force 3 months after his complaint to HR. The court expressed that it was "hard to believe" that the EEOC "is seriously arguing that the entire RIF process was a subterfuge for fraud designed for the sole purpose of providing cover for retaliation."

EEOC v. McPherson Cos., Inc., No. 10-cv-2627 (N.D. Ala. Nov. 14, 2012).

Discovery of EEOC Claimants' Social-Media Posts

Posted by Molly DiBiancaOn November 27, 2012In: EEOC Suits & Settlements, Social Media in the Workplace

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In my previous post about EEOC v. Original Honeybaked Ham Co. of Ga.,, I described a somewhat ambiguous, if not unusual, procedure for the production and review of individuals' social-media accounts ordered by a Magistrate Judge. In short, the Judge's well-reasoned decision attempted to balance the individual claimants' privacy interests with the defendant-employer's right to broad discovery of potentially relevant information. Faced with these two competing interests, the court crafted a fairly complex, multi-tiered, and dynamic process to collect, review, and produce the information from the former employees' social-media accounts.

The EEOC has filed an Objection to that decision. (An "objection" is, to put it simply, an appeal of a magistrate judge's decision to the trial judge). The objection gives us a bit more insight but a lot more questions.

The EEOC acknowledges in its objection that, since the issuance of the discovery ruling, the Magistrate Judge had revised the procedure--perhaps more than once. This indicates, and the EEOC makes clear, that the court has been and is continuing to be flexible in working with the parties towards a workable procedure. Nevertheless, we do not know what the alterations were.

One of the changes, though, is described in the Objection. Specifically, the EEOC states that the Court eliminated the appointment of a special master and, instead, designated an EEOC employee with computer-forensic qualifications to perform the collection. Under the initial Order, the claims were to turn over their log-in and passwords to their Facebook accounts to the special master, which caused a big stir among commentators. Now that the data will be harvested by EEOC personnel, perhaps the password issue is an issue no more.

But none of this addresses my bigger question--why make the process so complicated? Particularly, I wonder whether it wouldn't have been easier to have the claimants download their account information by using the tool provided by Facebook precisely for that purpose. DIY e-discovery of social-media seems to me to be a better option than the process in this case--at least the version of the process outlined in the Order.

Employer Can Depose All 94 Claimants In EEOC Lawsuit

Posted by Molly DiBiancaOn November 24, 2012In: Discrimination, EEOC Suits & Settlements, Race (Title VII)

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Litigating against the the EEOC is difficult for several reasons. For one, unlike a lawsuit brought by an individual plaintiff, a suit brought by the EEOC has the resources of the entire federal government behind it. Perhaps because of the agency's bureaucratic structure, negotiating with EEOC counsel can be difficult during litigation, at times resulting in a total breakdown of communication. A recent decision by a federal court in Illinois illustrates what happens when the lawyers in an employment-discrimination lawsuit take the driver's seat to the exclusion of the individuals at the heart of the case.

EEOC v. DHL Express (USA), Inc., was brought by the EEOC on behalf of 94 claimants, alleging that DHL discriminated against its African-American driver/dockworkers based on their race by giving them less desirable, more difficult, and more dangerous route and dock assignments than their Caucasian counterparts and by assigning African-American drivers to routes in predominately African-American areas.

DHL brought a motion to compel the EEOC to produce all of the claimants for deposition after the EEOC provided interrogatory responses that included an unsworn "vignette" for each claimant with the claimants' general allegations of discrimination. DHL argued that individual depositions were required because the vignettes were vague, filled with generalities, and, in several instances, inaccurate. DHL also argued that, because there is no standard as to what constitutes a "more dangerous assignment" and no objective criteria for what constitutes "less desirable," each claimant's individual testimony was necessary to establish its defense.

The court was not impressed by the "vignettes," finding that they failed to give any meaningful detail or specifics about the alleged discriminatory treatment. Instead, the court concluded that the additional 60 depositions (DHL had deposed 34 of the 94 claimants already), were necessary not to evaluate both potential liability and damages.

The lesson to be learned from this decision, in my opinion, relates mostly to litigation strategy. By submitting these "vignettes" in response to the defendant-employer's interrogatories, the EEOC seems to have forgotten about the individual employees whose claims were the basis for the lawsuit. Had the EEOC actually provided the sworn responses of the employees instead, the need for the employer to expend its resources to take an additional 60 depositions would not have been necessary. Or, perhaps, the EEOC should have formulated a clearer understanding of its allegations before filing its Complaint. Ah, a lawyer can dream, can't she?

EEOC v. DHL Express (USA), Inc., No. 10 C 6139 (N.D. Ill. Oct. 31, 2012).

Harassment Prevention: It's All Fun and Games . . . Until It's Not

Posted by Lauren Moak RussellOn November 4, 2012In: Discrimination & Harassment, EEOC Suits & Settlements, Harassment, Harassment, Other (Title VII), Race (Title VII)

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Workplace anti-harassment training can be summarized with the title of this post. The fact that an employee laughs at an inappropriate joke is not a legal defense to a later claim at harassment. Nor is an employee's failure to object to inappropriate workplace conduct. One employer recently learned this lesson the hard way.

In the case of EEOC v. Holmes & Holmes Industrial, Inc., the EEOC filed suit against a construction company on behalf of several Black employees, alleging hostile work environment claims. To succeed in a case alleging discrimination based on a hostile work environment, a plaintiff must prove that he or she was subject to (1) intentional discrimination, that was (2) severe or pervasive (3) and subjectively offensive to the plaintiff, and (4) that would be objectively offensive to a reasonable person in the plaintiff's position.

In support of its claims against Holmes & Holmes, EEOC asserts that the employee-claimants faced frequent, racially-charged comments from their managers and co-workers. EEOC also contended that supervisors frequently told racial jokes. In response, the employer argued that the employees engaged in similar conduct, frequently using racial slurs and terms.

Following the conclusion of discovery, the EEOC moved for summary judgment--and won! The Court granted partial summary judgment, concluding that the EEOC had proved elements one, two, and four of its claims. The Court's decision noted that the EEOC had brought the "rare case where there is no dispute as to the pervasiveness of the conduct in question. No reasonable jury could find that a reasonable African-American would not be offended by this conduct."

The Court rejected the employer's argument that the employees' participation in the misconduct indicated that it wasn't offensive. Instead, the Court left for the jury the question of whether the employees were willing participants in the harassment.
The employer now finds itself in the unenviable position of going to trial in a case with very bad facts.

The lesson to be learned may be easier said than done but absolutely essential in preventing litigation and limiting liability--inappropriate or off-color jokes do not belong in the workplace, regardless of who you seems to find them funny. Really, there's absolutely nothing funny about being suied for unlawful employment discrimination.

EEOC Wins Summary Judgment in Balt. Co. Pension Case

Posted by Molly DiBiancaOn October 22, 2012In: Age (ADEA), Benefits, EEOC Suits & Settlements

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EEOC was awarded summary judgment by a federal court in Maryland last week. The court found that Baltimore County's pension plan violates the ADEA in EEOC v. Baltimore County, Civil No. L-07-2500-BEL (D. Md. Oct. 17, 2012).

The Plan
All full-time employees under age 59 were required to participate in the Plan. Employees were required to contribute to the Plan at different rates based on the age at which they joined, so that the contribution would be sufficient to fund approximately one-half of his or her final retirement benefit, with the other half to be funded by the County. Older workers were required to contribute a higher percentage of their salary than younger workers because their contributions would have less time before retirement to accrue earnings. For example, a laborer who became a member of the Plan at age 25 was required to contribute 2.75%, whereas a laborer who joined at age 45 was required to contribute 4%. The Plan was changed in 2007 so that new employees were required to contribute at a flat rate, regardless of their age at the time they were hired.

The Litigation
In 2007, the EEOC filed suit on behalf of older County employees who had been hired under the original terms of the Plan. The District Court granted summary judgment to the County in 2008, finding that the Plan did not violate the ADEA because the disparate contribution rates were justified by a permissible financial consideration--the time value of money. The Court reasoned that the system was not based on age but on the number of years an employee had until reaching retirement age. The EEOC appealed and the Fourth Circuit vacated the judgment and remanded the case.

The Decision
On remand, the District Court determined that there are no non-age-related financial considerations that justify the disparity in contribution rates. In other words, the Court concluded that the County charged different contribution rates to different employees based on age and, therefore, age is the "but-for" cause of the disparate treatment in violation of the ADEA.

See also, EEOC press release.

Fighting Back: Bullies and Obesity

Posted by Molly DiBiancaOn October 3, 2012In: Disabilities (ADA), EEOC Suits & Settlements, Hiring, Jerks at Work, Off-Duty Conduct

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Some people are real jerks. Anyone who deals with the general public for a living knows that this is an indisputable fact. For those who work in sales or service positions know that the theory "the customer is always right" can be a bitter pill to swallow. Every waiter, store clerk, and receptionist has had a moment where they had to swallow very hard to resist firing back at an irate and/or irrational customer who's decided to take out his or her frustrations on whoever happens to be in their line of vision. Most of the time, it is not possible or not wise to fight back.

But, sometimes, it is.

Take, for example, Jennifer Livingston, a TV news anchor in LaCrosse, Wisconsin. A viewer with, apparently, way too much time on his hands, took it upon himself to write Ms. Livingston a note to express his displeasure with her weight. "Obesity is one of the worst choices a person can make and one of the most dangerous habits to maintain," wrote the viewer. "I leave you this note hoping that you'll reconsider your responsibility as a local public personality to present and promote a healthy lifestyle."

I think it's fair to say that Ms. Livingston didn't find the viewer's "concern" all that heartwarming. Heck, it may have even hurt her feelings. But, instead of hiding her pain, she elected to take a different approach and responded to the comments on the air. Her response took the form of an articulate call to arms in which she accused the viewer of being a bully.

I think the story is inspiring for a number of reasons but it also highlights a few different current issues in employment law.

First, there's the continuing discussion surrounding bullies in the workplace or, as I like to call them, "jerks at work." Legislation has been introduced in numerous states over the past five or so years that would, in short, make it unlawful to be a jerk at work. I think there are obvious problems with trying to legislate "jerkiness" but I also recognize the high costs that jerks can have on workforce morale, creativity, and overall productivity. This post at Above the Law provides a recent summary of the various legislative efforts.

Second, there's the as-yet-unresolved question of whether obesity is a disability under the Americans With Disabilities Act (ADA). Historically, courts have been unwilling to include obesity as a protected disability. With this precedent in mind, some employers have refused to hire applicants who are obese and charge higher health-care premiums for overweight employees. But the EEOC has said that the ADA does protect individuals who are morbidly obese. A case filed last year by the EEOC asserting that "severe" obesity was a protected disability under the ADA, recently resulted in a $55,000 settlement for the employee. And a recent decision by the Montana Supreme Court seems to further support that the trend has shifted towards protecting obesity as a disability.

EEOC Announces Plan for Class Warfare

Posted by Molly DiBiancaOn September 22, 2012In: EEOC Suits & Settlements

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Why should employers care about what the EEOC has on its to-do list for the next four years? Well, you've heard the phrase, "keep your friends close and your enemies closer," right? Kidding, just kidding, people! Geez!

But, seriously. The EEOC is working on a revised draft of its Strategic Enforcement Plan (SEP) for 2012-2016 and employers should pay close attention. The SEP offers employers important insight into the priorities of the EEOC. So don't look a gift horse in a mouth. exercising their rights constitute systemic barriers to the legal system.

Class Warfare is EEOC's Top Priority
Okay, so maybe this is an overly dramatic way to describe the EEOC's top priority. So sue me. As termed by the EEOC, "System Initiative" translates roughly to a continued focus on class litigation intended to eradicate several types of systemic discrimination:

1. Hiring. The SEP identifies class-based hiring discrimination as a main focus, including discriminatory pre-employment tests, background screening, and date-of-birth screening.

2. Protection of "immigrant, migrant, and other vulnerable workers." Particular areas of focus in this regard include disparate pay, job segregation, harassment, trafficking, and discriminatory-language policies.

3. "Emerging Issues" identified in the Draft Plan include:

a. ADA Amendments Act issues

b. LGBT coverage under Title VII sex discrimination provisions

c. Accommodating pregnancy when women have been forced onto unpaid leave after being denied accommodations routinely provided to similarly situated employees.

4. Preserving Access to the Legal System. This is the big one, folks. There are two components to this initiative. Both should get your attention.

a. Prioritization of the investigation of retaliation claims. Not only is retaliation the most commonly asserted claim but it is also the most difficult to defend. Per the SEP, the EEOC believes that retaliation is a barrier to justice because it discourages employees from exercising their rights. (Hard to argue with that, really).

b. "Systemic barriers" to justice. Think, "settlement and severance agreements." The EEOC says that "overly broad waivers" and releases that unfairly discourage employees from exercising their rights constitute systemic barriers to the legal system.

Implementation
The EEOC does not envision the Plan as a one-size-fits-all approach. To the contrary, it will require that each District develop a District Complement Plan to the SEP by March 29, 2013. These localized Plans are to identify how that particular Office will implement the SEP priorities, as well as identify its own local enforcement priorities.

3d Cir Confirms EEOC's Broad Subpoena Power

Posted by Molly DiBiancaOn September 17, 2012In: EEOC Suits & Settlements

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The EEOC's subpoena power is broad. But just how broad has been the subject of debate in recent years. On September 14, 2012, the Third Circuit Court of Appeals issued an opinion that definitely falls on the "broad powers" end of the spectrum.

The case, EEOC v. Kroger, involves allegedly discriminatory assessment tests used by Kroger as part of its hiring process. The tests were created by a company called Kronos, Inc. The district court ruled that the EEOC could not subpoena materials from Kronos that did not directly relate to the test it had developed for Kroger.

The EEOC appealed the decision and the 3d Circuit overturned it. The 3d Circuit ruled that Kronos had to produce such documents "even if not directly linked to Kroger" because they could "reveal that the assessment had an adverse impact on disabled applicants or they could assist the EEOC in evaluating whether Kroger's use of the test constituted an unlawful employment action."

Two points to note from this case. First, the general dangers associated with assessment tests used for hiring. Employers are on the hook for tests that they do not create. The entity that the employer hires to create valid tests may be a credible, legitimate authority but, at the end of the day, it's not that company's problem when the employer is sued.

Second, this case presents yet another example of the aggressive litigation tactics employed by the EEOC. The Charge that initiated the litigation was filed in June 2007--more than 5 years ago. Yet, here we are, reading an appellate court opinion on discovery issues. (This, by the way, is the second time a discovery decision was appealed to the 3d Cir.). Once the EEOC pulls the litigation trigger, there's virtually no way to get it to back down.

See also:
What Does "Good Faith" Mean for the EEOC?
When the EEOC Goes Too Far
When the EEOC Goes Too Far, Part II

What Does "Good Faith" Mean for the EEOC?

Posted by Molly DiBiancaOn August 27, 2012In: EEOC Suits & Settlements

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The District of Hawaii is the latest federal court to address the obligations of the EEOC during conciliation before it files suit. In EEOC v. La Rana Hawaii, LLC, the court determined that the Ninth Circuit's decision in EEOC v. Pierce Packing required a "genuine investigation, reasonable cause determination and conciliation [as] jurisdictional conditions precedent to suit by the EEOC." The court explained that, in light of this precedent, the EEOC must actually investigate the claims of discrimination and harassment and attempt to resolve the claims through good-faith conciliation.

The court next considered whether the EEOC's conciliation efforts in this case adequately satisfied Title VII's pre-suit requirement. The court acknowledged that the Ninth Circuit has not yet articulated a standard for determining the sufficiency of conciliation. Nevertheless, the court found that the EEOC had failed to conciliate in good faith by failing to provide the defendants with enough information with which they could evaluate the EEOC's claims.

Specific problems that the court identified included the EEOC's "obstinate refusal" to provide the defendants with any specific information about the class members or the allegedly unlawful acts. This refusal constituted a failure to demonstrate a "willingness to work toward settlement." The court found that the EEOC's "take-it-or-leave-it" offer further demonstrated the insufficiency of its efforts.

Having found that the EEOC failed to satisfy its pre-suit conciliation obligation, the court explained that the EEOC should be provided the opportunity to cure any defect in the process. As a result, the court stayed the case pending the completion of a good-faith conciliation by the parties. The court instructed the EEOC to provide the defendants with information necessary to make an informed decision about the case. For example, the EEOC must provide the number or identity of the claimants that it had identified during its investigation, as well as information about the specific incidents of harassment or discrimination.

EEOC v. La Rana Hawaii, LLC.pdf

See also:
When the EEOC Goes Too Far
When the EEOC Goes Too Far--Part II

When the EEOC Goes Too Far--Part II

Posted by Molly DiBiancaOn August 8, 2012In: EEOC Suits & Settlements

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In my post, When the EEOC Goes Too Far, I wrote about an opinion from the Middle District of North Carolina, issued in June. In that case, EEOC v. PBM Graphics, Inc., the court found that the EEOC had caused an unreasonable delay in pursuing its claims, based on a 5+-year-long investigation and seemingly superficial conciliation efforts. The court ordered the parties to engage in limited discovery to determine whether the EEOC's delay had prejudiced the defendant-employer. If so, the court ruled, the employer would be entitled to have the complaint dismissed in accordance with the doctrine of laches.

A laches defense to overzealous claims by the EEOC seems to be gaining traction. A decision issued yesterday by the Western District of North Carolina went farther than the PBM Graphics decision and actually dismissed the case based on this defense.

The facts are similar in both cases. Like the complaint in PBM Graphics, the claims asserted in Propak Logistics were based on the employer's alleged practice of hiring Hispanics and refusing to hire non-Hispanic persons for non-management positions. Similar to the multi-year delay in PBM Graphics, there was a nearly seven-year delay between the time of the initial Charge and the filing of the Complaint. A few other important, albeit unsettling facts, include:

  • the EEOC did not interview the Charging Party until six months after he'd filed his Charge and did not interview him for a response to the employer's position statement until a year after it had been submitted;
  • the EEOC referred the Charge to the DOJ, which initiated and completed its investigation in less than a year, resulting in a No-Cause Finding;
  • there was a four-and-a-half-year delay between the Charge filing and the EEOC's attempt to conduct additional interviews of the relevant decisionmakers;
  • the Charging Party's federal lawsuit was dismissed with prejudice two months before the EEOC issued its Cause Finding;
  • the Charging Party requested a Right-to-Sue-Letter no less than four times;
  • there was a two-year delay between the time the EEOC designated the Charge as a class claim and the first interview of a potential class member;
  • the employer's VP of HR was deposed more than eight years after the Charge was filed; and
  • the facility at which the Charging Party had worked (for all of two months) closed in 2008.
And, as in PBM Graphics, here the employer also filed a motion to dismiss on several grounds, including on the defense of laches. The court denied the motion to dismiss based on failure to state a claim and gave the parties three options: (1) agree to proceed with discovery; (2) have the court consider the motion as a motion for summary judgment; or (3) submit additional briefing and evidence.

The EEOC apparently conceded that there had been a delay. (Indeed!!) This is where we left off in PBM Graphics--the court ordered the parties to engage in limited discovery on this issue. Here, though, the court found that the record contained sufficient evidence to answer the question.

The court explained that, for the purpose of laches, evidence of prejudice may include unavailability of witnesses, change in personnel, and the loss of pertinent records. The court also pointed out that there were periods when the EEOC "took little or no action toward completing the investigation," during which the "back pay meter has been running" as the defendant-employer could be liable for that period. Because back pay is an equitable remedy within the court's discretion, though, the court considered this to be further evidence of potential prejudice.

Finding that the employer had established its laches defense by proving that it "suffered material prejudice as a result of the EEOC's unreasonably lengthy delay," the court explained:

The fact remains, however, that Propak no longer conducts business at the facility at which the alleged discrimination occurred. The purported class of individuals allegedly discriminated against last existed in 2004 and it is uncertain that these individuals could even be identified at this late date. Meanwhile, for the last eight years, Propak has been embroiled in both the EEOC investigation and two lawsuits stemming therefrom, during which time it has continuously incurred attorney's fees. The interests in vindicating Propak's conduct has been served while it appears to be impossible to vindicate the private interests of unidentified and unavailable class members.

Legal music to my ears. The case is a stellar example of a victory of common sense and fairness. It seems that the employer had excellent legal representation, who continued to assert the company's defenses instead of throwing in the towel and being cooperative to a fault. And that was rewarded by the court, which recognized that there are limits to the EEOC's power--i.e., there is a difference between an investigation and a persecution.

I have no doubt that many employers will find this to be an important and valuable resource in their arsenals to defend against the EEOC when it goes too far.

As a side note, the court found that the EEOC's failure to provide its damages calculations to the employer was evidence of an unreasonable delay. This appears to support the use of a laches defense where a defense of failure to conciliate may not be successful, particularly in jurisdictions like the Fourth Circuit that require only the most minimal effort by the EEOC to meet its statutory burden to conciliate in good faith.

EEOC v. Propak Logistics, Inc., No. 1:09cv311 (W.D.N.C. Aug. 7, 2012).