By: Michael Jacobsen, Christopher DeGroff, and Gerald L. Maatman, Jr.

Seyfarth Synopsis:  On April 10, 2019, the EEOC released its comprehensive enforcement and litigation statistics for Fiscal Year 2018.  The release arrived a few months later than usual – likely due to the recent government shutdown – but still packed a punch in several respects, including to the back-drop on retaliation and sex discrimination charges in the midst of the #MeToo movement, the number of merits lawsuits filed, and significant monetary recoveries, as well as a reduced charge inventory.  It is a must-read for all employers.

On April 10, 2019, the EEOC released its comprehensive enforcement and litigation statistics for Fiscal Year 2018 (available here).  In addition to enforcement and litigation activity, the data breaks down charge statistics by allegation and state – showing which charges are being filed the most and where.  Although the dip in total charges filed certainly stands out, so does the prominence of retaliation and sex discrimination charges in the #MeToo era.  The statistics are somewhat of a “report card” on the Commission’s activities, and also illustrates the continued increase in the number of lawsuits filed by the EEOC overall, as well as the number of systemic lawsuits filed specifically, and touts the substantial monetary recoveries that the EEOC continues to reel in from employers.  The data also mark the EEOC’s accomplishments in reducing its charge inventory.

Charges Are Down Overall

In total, 76,418 charges were filed in FY 2018.  Not only is this down from 84,254 charges in FY 2017, but FY 2018 saw the third fewest charges filed for all fiscal years going back to FY 1997 according to the EEOC’s data, above only FY 2006 (with 75,768 charges) and FY 2005 (75,428).  Further putting FY 2018’s drop to 76,418 charges in perspective, the number of charges filed exceeded 80,000 every other year starting in FY 2007, by 8,000 to 19,000 in most of them.

Consistent with this overall decline, there was a decrease in almost every category of charges in FY 2018 from FY 2017, with the exceptions of some modest increases in Equal Pay Act and genetic information charges at the very bottom of the list.  The category that decreased the most was race, by 3,928 charges – or almost 14% – from FY 2017 to FY 2018.

While generally down, however, these numbers are still sizable.  And outreach to the agency was consistent with prior years, as well, with the EEOC reporting that it addressed 519,000 calls to its toll-free number and more than 200,000 inquiries to its field offices in FY 2018, roughly in the ballpark of 540,000 calls and 155,000 inquiries in FY 2017, respectively.

Texas And Florida Are Still Hot, With California Getting Warmer

Looking at the states where the most charges were filed, the hot spots largely remained the same in FY 2018 as in FY 2017.  In fact, 9 out of the top 10 states in FY 2017 also made the cut for FY 2018, except for Alabama knocking Tennessee out of the number 10 spot. As in FY 2017, Texas (with 7,482 charge receipts) and Florida (with 6,617 charge receipts) were the top two states for charges in FY 2018.

Texas and Florida should come as no surprise, given their relative populations according to the most recent census data (found here). But population is not everything.  For example, Georgia (at number 4) surpasses states with higher populations, and Illinois and Pennsylvania each have more filings than New York.  And, although one might expect California to be number one given that it is the most populous state, its strong state discrimination statute tends to claim charges that may otherwise have been filed with the federal agency.  Nevertheless, while the top 10 list on the whole was fairly static from the prior fiscal year, California was a notable exception, leaping from having the sixth most charges filed in FY 2017 to the third most charges filed in FY 2018.

Retaliation Charges Remain In First, With Sex Discrimination A Notable Second

In total, 39,469 retaliation charges were filed with the EEOC in FY 2018.  As has been the case for the past five years, this made retaliation the most frequently filed charge in FY 2018.  Also noteworthy, retaliation charges crept over the 50% marker in FY 2018, continuing a steady annual increase from 42.8% of the total charges filed in FY 2014.

Behind retaliation were sex, disability and race charges, each approximately 32% of the total charges filed with the EEOC.  (As the EEOC notes, the percentages total more than 100 because some charges allege multiple bases.)

Sex discrimination charges (which would include pregnancy discrimination, gender discrimination, and sexual harassment) were particularly notable in that they edged out disability and race charges by a tenth of a percent to claim the number-two spot, after being the fourth most frequently filed charge in FY 2017.  Breaking down the data for sex charges further, there were 7,609 sexual harassment charges filed with the EEOC in FY 2018, making for a sizable jump of 13.6% over the prior fiscal year.

No doubt, these trends in sexual discrimination and retaliation charges were fueled by the “significant impact of the #MeToo movement,” as noted by Acting Chair Victoria A. Lipnic.  Indeed, the EEOC’s commitment in this area has not wavered in light of the increased visibility of workplace sexual harassment resulting high-profile media coverage in 2018.  As reported previously, the 41 sexual harassment lawsuits filed by the EEOC in FY 2018 marked a 5-year high.  And the EEOC also reported a total recovery of $56.6 million for alleged victims of sexual harassment in FY 2018.

EEOC Keeping Its Foot On The Gas

Overall, the statistics show that the EEOC filed 199 merits lawsuits in FY 2018, up from 184 merits lawsuits filed in FY 2017.  While not as dramatic a spike from the year before – in which the EEOC more than doubled the number of merits lawsuits it filed compared to the prior fiscal year – the appreciable growth in FY 2018 on top of that jump should not be overlooked.  The EEOC reports that 117 of those lawsuits were on behalf of individuals, 45 were non-systemic suits with multiple victims, and another 37 were systemic claims.

The EEOC labels a case as “systemic” if it “has a broad impact on an industry, company or geographic area.”  As such, these cases pose heightened exposure.  In terms of percentages, systemic lawsuits accounted for about 18.5% of the total number of filings, which is consistent with prior years (16% of all merits lawsuits in FY 2017 and 20% in FY 2016).  Looking at the numbers, however, the 37 systemic lawsuits filed in FY 2018 was up from 30 that the EEOC filed in FY 2017, 18 in FY 2016 and 16 in FY 2015.  As with the number of merits lawsuits filed, the number of systemic lawsuits may not have risen quite as dramatically as it did in FY 2017.  Nevertheless, employers should pay attention as the number continues to rise in FY 2018 even in the wake FY 2017’s spike.  Clearly, the EEOC is not shying away from pursuing these “bet-the-company” cases.

The EEOC boasted substantial recoveries to boot.   Specifically, the EEOC secured more than half a billion dollars ($505 million) in total relief for alleged discrimination victims in FY 2018.  This marks a substantial increase from $484 million in FY 2017 and $482.1 million in FY 2016.

Bringing Down The Backlog

Another priority of the EEOC in recent years has been reducing the large backlog of pending charges, which had been a longstanding issue for the agency.  In FY 2018, the EEOC resolved 90,558 charges.  This was down from 99,109 charges resolved in FY 2017 and 97,443 charges in FY 2016.  Nevertheless, the EEOC still decreased its charge inventory by 19.5%, to 49,607 in FY 2018, following up on FY 2017, in which the EEOC decreased its charge inventory by 16.2% to 61,621.  Indeed, as Acting Chair Lipnic noted for FY 2018, the data reflected the “lowest inventory of private sector charges in a dozen years.”  The EEOC attributed its success in this area to new strategies for prioritizing charges and resolving them more efficiently, and with the assistance of enhanced technology.

Implications For Employers

Despite the dips in overall charges filed, the EEOC’s enforcement efforts remain robust, and the EEOC continues to get results, as demonstrated by its recovery statistics.  And, by reducing its backlog, the EEOC is freeing up its resources for further enforcement efforts.  As noted in our other reports, clearly the EEOC is aggressively pursuing its strategic goals under the current administration.  Employers should keep an eye on these statistics, especially with retaliation and sex discrimination issues firmly in the forefront.  And, by continuing to set the culture in their workplaces through leadership and accountability, along with sound human resources practices such as sharp written policies, comprehensive training and robust response protocols, employers can guard against these issues, which clearly are not going away.

By: Gerald L. Maatman, Jr.Christopher J. DeGroffMatthew J. Gagnon, and Kyla J. Miller

Seyfarth Synopsis: We are once again pleased to offer our readers an analysis of the five most intriguing developments in EEOC litigation in 2018, in addition to a pre-publication preview of our annual report on developments and trends in EEOC-initiated litigation. This year’s book, entitled EEOC-Initiated Litigation: FY 2018, provides a comprehensive examination of the EEOC’s FY 2018 filings, and the major decisions handed down this year in pending EEOC litigation.

Each year, we conduct a thorough analysis of new lawsuits filed by the EEOC and major case decisions handed down by courts across the country in EEOC litigation. Our goal is to identify key trends regarding new areas of focus for the EEOC and significant procedural or substantive developments in EEOC litigation. We package those trends and developments into one comprehensive volume, EEOC-Initiated Litigation: FY 2018, which we provide to our clients so they can use that information in structuring their compliance programs and to avoid becoming a target of the EEOC’s enforcement agenda. Our annual report is targeted towards HR professionals, corporate counsel, and other corporate decision-makers.

This year, we have analyzed trends and developments in light of the strategic priorities identified by the EEOC itself in its Strategic Enforcement Plan. Over the years, we have consistently found that those strategic priorities guide the EEOC’s actual enforcement agenda. How the EEOC has interpreted and defined its agenda in light of those priorities is one of the key insights that we hope to provide in our annual report.

The full publication will be offered for download as an eBook. To order a copy, please click here.

As always, we like to take a moment at the end of the year to reflect on what we consider to be the most intriguing EEOC-related decisions and developments of the year. Here is our list of the “top five” most intriguing developments of 2018.

Intriguing Developments 1 and 2: Pleading Tactics

A pair of cases decided under the ADA brought some interesting insight into the relative advantages and disadvantages the EEOC enjoys at the pleading stage.

In EEOC v. UPS Ground Freight, Inc., the EEOC took the unusual and aggressive step of arguing, in a motion for judgment on the pleadings, that the language of a collective bargaining agreement established a prima facie case of a discriminatory policy under the ADA because it paid drivers disqualified for medical reasons less than what it paid drivers disqualified for non-medical reasons. The Court granted the EEOC’s motion, and issued a permanent injunction against the company, holding that the agreement’s language was plain and unambiguous, and that no case-by-case analysis was required because the language itself was enough to establish that unlawful discrimination was part of the employer’s “standard operating procedure.” This decision is remarkable for a number of reasons, but perhaps most especially because of the EEOC’s unusually aggressive – and successful – tactic to establish a prima facie case of liability at the very outset of the case. Employers should be wary of the EEOC using this tactic in future cases.

In EEOC v. Prestige Care, Inc., however, the EEOC did not fare so well.  The EEOC sued Prestige Care on behalf of 13 identified claimants for violations of the ADA, arguing that the employer followed policies that did not permit reasonable accommodations for qualified individuals. In a motion to dismiss, the employer argued that the EEOC’s complaint was deficient as to ten of the 13 claimants because it failed to allege they had impairments that affected a major life activity, or failed to identify essential job functions, and therefore had not alleged that they had plausible ADA claims. The EEOC argued that it was not required to do so because it has the unique and broad authority to bring lawsuits in its own name on behalf of a group of unnamed individuals. The Court disagreed, holding that the EEOC is not immune to normal pleading requirements. When the EEOC identifies additional victims who have allegedly suffered disability discrimination, it must plausibly allege that those individuals are protected by the ADA. In other words, despite the often lopsided relationship between employers and the agency during the investigative stage, the parties are on equal footing in the court system.

Intriguing Developments 3 and 4: LGBT Discrimination, The Debate Rages On

For the past several years, the EEOC has maintained that discrimination on the basis of sexual orientation or gender identity is a form of sex discrimination prohibited by Title VII because it is tantamount to discrimination for failure to adhere to perceived gender stereotypes. The U.S. Department of Justice under the Trump administration has conspicuously broke with the EEOC, arguing in a number of amicus briefs that Title VII does not cover those forms of LGBT discrimination. Nevertheless, the EEOC and private plaintiffs continue to rack up victories on this front. In Zarda v. Altitude Express, Inc., the Second Circuit ruled en banc that Title VII prohibits discrimination on the basis of sexual orientation. The Second Circuit has now joined the Seventh Circuit, the EEOC, and a number of district and administrative courts across the country that have interpreted Title VII to extend its prohibition of sex discrimination to sexual orientation.

Will the Supreme Court step in? With the federal circuits divided on this issue, not to mention the vastly divergent interpretations of Title VII by the agencies entrusted to enforce Title VII, many observers considered this issue ripe for review by the U.S. Supreme Court. And, in fact, the Supreme Court had set a date in November of 2018 to decide whether to grant review of three cases, including Zarda, which had addressed this issue. In November of 2018, the Supreme Court delayed consideration of that issue and then, abruptly, removed it from its calendar altogether. The original date had been set in September of 2018, before the bruising confirmation fight over Justice Kavanaugh. Some have speculated that this is evidence that the Supreme Court is trying to avoid controversial cultural issues during Kavanaugh’s first term to allow time for the dust to settle from his confirmation battle. In the meantime, employers are forced to contend with a confusing patchwork of interpretations regarding the scope of Title VII that can vary from Circuit to Circuit, and from District to District.

Intriguing Development 5: The #MeToo Movement Surges

Our last pick as a top 5 development of the year is actually an aggregation of the dozens of cases the EEOC filed alleging sexual harassment. As we previously reported here, one of the most striking trends of FY 2018 has been the huge spike in sex-based discrimination filings, especially those alleging sexual harassment. Lest there be any doubt as to whether this represents a significant shift in priorities, on October 4, 2018, just four days after the end of the EEOC’s 2018 fiscal year, the agency took the unusual step of announcing its preliminary FY 2018 sexual harassment data. Employers usually must wait until the EEOC releases its Performance and Accountability Report in mid-November to see that kind of data. The EEOC trumpeted filing 66 harassment lawsuits in FY 2018, 50% more than FY 2017. Given the intense focus on this issue, we strongly suspect that this trend is here to stay for the foreseeable future.

Despite predictions to the contrary, the EEOC has continued its “business as usual” aggressive litigation despite two years under the Trump administration. Changes are, however, afoot. The Senate has still not confirmed two Trump-nominated Republican Commissioners, including one who is set to become Chair of the Commission, or Trump’s pick to be the EEOC’s General Counsel. (One of those nominated to be a Commissioner, Daniel Gade, recently withdrew from consideration on December 21, 2018, citing the delays in the nomination process as the reason.) Eventually, the impact of the injection of new decision makers will be felt, perhaps dramatically. That makes it especially important for employers to monitor these developments in 2019. Of course, we will have our ear to the ground, and look forward to sharing our thoughts and prognostications with our readers throughout the new year!

Readers can also find this post on our Workplace Class Action blog here.

 

By Gerald L. Maatman, Jr., Christopher J. DeGroff, Matthew J. Gagnon and Alex W. Karasik

Seyfarth SynopsisOn November 15, 2018, the EEOC released its annual Performance and Accountability Report (‘PAR”) for Fiscal Year 2018 (here) – a year-end report card of sorts, and a critical publication for employers to consider as they analyze the EEOC’s activities over the past year, and its anticipated direction for the future.

In its first year under the Strategic Plan for Fiscal Years 2018 through 2022 (“Strategic Plan” or “Plan”) (blogged about here), the EEOC reported significant increases in its outreach efforts and enforcement actions, as it highlighted new intake procedures, extensive training programs, and aggressive litigation.  Particularly noteworthy was the EEOC’s track-record relative to workplace sexual harassment litigation, which has become a top priority as the #MeToo movement has spotlighted the issue. 

The 2018 PAR is a “must read” for corporate counsel, as it provides valuable insights into the agency’s mission, as well as warnings that employers should heed. 

Raking In Recoveries

In FY 2018, the EEOC recovered more than $505 million for alleged discrimination victims.  This represents a significant jump from $484 million in FY 2017 (see more here), and $482.1 million in FY 2016 (see more here).  But while the total monetary relief figure ballooned, the relief obtained through mediation, conciliation, and settlement declined from $355.6 million in FY 2017 to $354 million in FY 2018.  Conversely, litigation recoveries jumped to $53.6 million in FY 2018 from $42.4 million in FY 2017 (the FY 2016 and 2015 numbers were $52.2 million and $65.3 million respectively, more closely mirroring this year’s figures).

Firing Up The Filings

The EEOC reported filing 199 merits lawsuits in FY 2018, a slight uptick from the 184 merits lawsuits it filed in FY 2017.  This included 117 suits on behalf of individuals, 45 non-systemic suits with multiple victims, and 37 systemic suits.  The EEOC labels a case “systemic” if it “has a broad impact on an industry, company or geographic area.”

For employers, the 37 systemic lawsuits is a particularly noteworthy figure.  In FY 2017, the Commission filed 30; in FY 2016 it filed 18; and in FY 2015 it filed 16.  The acceleration in systemic lawsuits illustrates that the EEOC is not backing down on its agenda of aggressively litigating “bet-the-company” cases.  Given the heightened financial exposure in systemic litigation, this is one trend employers should certainly heed.

Making Its Mark In The #MeToo Movement

Workplace harassment has never been more in the forefront of the EEOC’s focus than it is today.  The EEOC’s PAR emphasized that it reconvened the Select Task Force on the Study of Harassment in the Workplace for a public meeting, “Transforming #MeToo into Harassment-Free Workplaces,” to examine difficult legal issues and to share innovative strategies to prevent harassment.  The Commission reported that it recovered a whopping $70 million for the victims of sexual harassment through administrative enforcement and litigation in FY 2018, up dramatically from $47.5 million in FY 2017.  Unquestionably, given the increased visibility of workplace sexual harassment based on various high-profile media coverages in 2018, the Commission has turned up the heat on investigations and litigation in this area.

Balancing The Backlog

For several years, the EEOC has been working through its significant backlog of pending charges.  As EEOC Acting Chair Victoria Lipnic noted in the PAR, “[s]oon after I became Acting Chair in 2017 I made addressing the backlog a priority, and as an agency, we began to share strategies that have been particularly effective in dealing with the pending inventory, while ensuring we are not missing charges with merit.”  Chair Lipnic has made good on her word, noting the EEOC dramatically reduced its pending inventory in FY 2018 to 49,607 charges, a decrease of 19.5% from FY 2017 and 34% from FY 2015.  One area that remains ripe for improvement, however, is the backlog of Freedom of Information Act requests, as the PAR reports that the EEOC’s FOIA backlog increased by 185% at the end of FY 2017, but only decreased by 7% in FY 2018.

Portal To The Future

As part of its mission to facilitate the intake process, the launch of a nationwide online inquiry and appointment system as part of the EEOC’s Public Portal resulted in a 30% increase in inquiries and over 40,000 intake interviews.  These figures come as a result of the Commission’s recent commitment to enhance its Digital Charge System and allow technological advances to ease the burden caused by an increased volume of activity.

The Commission additionally noted that its outreach programs reached more than 398,650 workers, employers, their representatives and advocacy groups this past fiscal year at more than 3,900 events conducted by the EEOC.  This reflects the EEOC’s commitment to preventing workplace harassment through proactive measures, while simultaneously increasing public awareness about the mission of the Commission.

Implications For Employers

There were those who believed the EEOC’s enforcement efforts would downshift under the current administration.  Our year end reports, and the EEOC’s own PAR report card, demonstrates quite the opposite.  The EEOC has made it clear that it is ramping up across the board, not slowing down.  This includes a significant increase in filings, recoveries, and outreach efforts.  The EEOC’s PAR is a helpful resource for employers to chart the danger areas in today’s tumultuous political and social environment.  We will continue to report on the EEOC’s enforcement trends.  Stay tuned.

Readers can also find this post on our Workplace Class Action blog here.

By: Mark Wallin, Christopher DeGroff, and Gerald Maatman, Jr.

Seyfarth Synopsis:  The EEOC operates with limited resources, yet has the daunting responsibility of enforcing an alphabet soup of anti-discrimination laws.  The EEOC has become quite savvy at leveraging the press as a pulpit for publicizing its agenda, especially in litigation.  An employer need only visit the EEOC’s website to understand the role of media statement’s in the Commission’s enforcement process.

In the life-cycle of EEOC initiated litigation, the agency will almost invariably issue two media statements: one issued when the suit is filed, and another when the suit is resolved.  But not all media statements are the same.  Depending on the posture of the case, whether the case theories align with the EEOC’s strategic goals, and even how the EEOC views the employer, media statements can vary dramatically.  This post discusses what employers can expect from these releases, including typical language, elements, and timing.   

EEOC’s Publicity Philosophy

The EEOC has acknowledged that press coverage is part of its deterrent message and mission.  Notably, the Commission’s 2006 Systemic Task Force report provides that the “EEOC engage[s] in high impact litigation and publicity efforts that change the workforce status of affected groups and/or improve employment policies, practices, or procedures in affected workplaces.”  (See also opening statement of Sen. Alexander regarding the Commission’s apparent strategy, in filing certain lawsuits, to “achieve a maximum amount of publicity.”)

The EEOC’s litigation media statement is one of the tools in the Commission’s toolbox that it will wield with an aim to achieve its strategic enforcement goals.

Often Two Media Statements During The Course Of EEOC Initiated Litigation

In the life of a lawsuit initiated by the EEOC, there will ordinarily be two media statements. The first will be published when the suit is filed, and the second if the case is resolved.  Although all media statements published upon filing of a suit will have roughly the same cadence and tone, those published upon resolution can vary greatly.

Initial Media Statement

A media statement issued at the outset of the litigation tends to have a stern tone, regarding the alleged actions of the employer.  The statement will lead off with a general assertion of the legal claims lodged against employer, including the statute at issue.  For example, the statement may declare that a female employee suffered through a hostile work environment at the hands of her supervisor, in violation of Title VII.  The statement will then go on to recite the key allegations of discrimination, harassment, or retaliation proffered in the complaint.  These allegations are often delivered as fact, not issues that will be proven – or not – during the litigation.  Often times the statement will also describe the employer, perhaps sharing a website, states of operation, and a brief description of the work done by the business. Finally, the applicable District Director and/or one of the trial attorneys for the matter will offer a quote in the nature of a sound bite concerning the allegations, which will emphasize the Commission policy underlying its prosecution of the lawsuit.  In the most recent batch of EEOC filings, for instance, which occurred in September, combating sexual harassment and discrimination (“me too”) is the most common EEOC policy articulated. It is not surprising that many employers who have been the subject of the EEOC’s media statements have deemed the Commission’s tactics to be unfair and designed to apply extra-judicial pressure to settle litigation.

Media Statement Upon Resolution

When a suit is resolved, typically through an agreed upon consent decree (but occasionally after a rare trial win), the EEOC will publish yet another media statement.  The tone and content of this statement, however, can vary from highly aggressive to fairly measured, and can even verge on “friendly.”  The direction taken by the EEOC in this statement will depend largely on the resources devoted to the litigation, how contentious the litigation was, as well as whether the claims and allegations at issue align with the Commission’s strategic goals.  Some insight into the Commission’s process can be found in the Regional Attorney’s manual, published here. Notably, before the resolution of “significant litigation” a Regional Attorney is required to advise the Office of the General Counsel.  The Commission defines “significant” to mean a lawsuit “expected to involve significant monetary or injunctive relief”; “a favorable jury verdict or court decision”; or resolution which “is likely to receive national or significant local attention due to the notoriety of the defendant, ongoing media interest in the lawsuit and/or issues involved, or other factors that may have spurred significant media scrutiny.”  Whether or not the litigation is deemed “significant” may well play a role in the tone of the media release as well.

The more resources expended, and the more closely aligned the claims are with the Commission’s strategic goals, the more likely the EEOC will publish an aggressive media statement.  The hallmarks of such a statement will be not only the recitation of the most salacious of the allegations, but also a detailed description of the monetary and programmatic relief obtained in the consent decree.  For example, in a recent matter involving an Illinois restaurant, the EEOC’s media statement set forth that “numerous employees … were routinely sexually harassed by coworkers and managers, including offensive sexual comments, groping, physical threats, and, in one instance, attempted forced oral sex with a management employee.” The statement went on to detail the programmatic relief, followed by harsh admonishments from a Regional Attorney and District Director, specifically:

“Employers are responsible for preventing workplace harassment – and their failure to do so hurts both their employees and their bottom line,” said Andrea G. Baran, Regional Attorney for the EEOC’s St. Louis District. “Business owners and CEOs must be proactive and involved in making sure all managers and employees understand that harassment will not be tolerated, harassers will be punished, and those who report harassment will be protected from retaliation. Prevention starts at the top.”

Moving down the spectrum, the Commission may take a more measured tone where the litigation is less protracted and the claims are not necessarily consistent with its strategic goals. For instance, in a recent ADA case settled by the EEOC concerning an employer’s alleged discriminatory termination of a disabled employee, which had been pending less than a year, the media statement provided scant details concerning the claims brought. Further, after a short description of the programmatic relief contained in the lone statement of a Regional Attorney was far more benign:

“This settlement is both strong and just,” said Rudy Sustaita, regional attorney for the EEOC’s Houston District Office. “[The employer] has given us every indication that it intends to comply with the ADA in the future.”

And on occasion, it will even boarder on “friendly” — including a statement of appreciation to the employer for its cooperation in resolving the litigation. In a suit brought in Wisconsin, filed and settled within five months, the Commission was quoted as stating:

“We thank [the employer] for its commitment to settle this case before the sides incurred significant costs and its willingness to ensure a level playing field for its pregnant employees seeking job modifications, including light duty work, otherwise available to non-pregnant employees,” said EEOC Chicago Regional Attorney Gregory M. Gochanour. “The EEOC will continue to enforce the federal laws so that all pregnant employees have the same opportunities as non-pregnant employees to contribute to our thriving economy,” said Julianne Bowman, the EEOC’s District Director for the Chicago District Office.

Although “friendly” media statements are the exception, not the rule, the EEOC is more likely to publish such a statement to incentivize other employers to similarly resolve enforcement actions.

A Word On Conciliation Media Statements

Historically, the EEOC has generally issued media statements for lawsuits only, as conciliation is intended to be a confidential process.  Indeed, one of the chief reasons for employers to engage in pre-suit conciliation is the carrot of confidential resolution.  Interestingly, however, we have seen a trend of the EEOC issuing presumably agreed-upon media statement for matters settled in conciliation.  Accordingly, the employer has a degree of leverage in negotiating these publications.  As one might imagine, conciliation media statements are, thus, more positive in tone. Further, on occasion, the employer may also make a statement, which at minimum disclaims any liability — something rarely, if ever, allowed in a litigation media statement.

Elements Of A Media Statement

Regardless of the tone, EEOC media statements are consistent in their basic elements and structure.

First, there will be a headline crafted to be eye-catching, such as “Paramount Mailing Company Punished Female Employees for Complaining About Abuse, Federal Agency Charges.”  Below is a word cloud, highlighting the most common words and phrases employed by the EEOC in its 2018 headlines.  Not surprisingly, in the current environment, “Sexual” and “Harassment” play prominently.

Second, the media statement will include a statement of claims, describing the complained of discrimination, harassment, and/or retaliation, including factual and legal allegations.  The more aggressive press releases will set forth the most sensational and detailed allegations, whereas the measured versions may state the allegations in more bland terms, which can sometimes be so vague that it is difficult to divine what the claims were based upon in the first place.

Third, the Commission will include quotes from the relevant District Director and possibly a Regional Attorney involved in the litigation.  The tone of the EEOC’s quotes can vary greatly, depending on, among other things, the importance of the issue to the Commission’s strategic goals, the duration of the litigation, and resources expended.  Excluding conciliation media statements, on very rare occasions, the EEOC may allow a quote from the employer on the resolution of the lawsuit.  Although it is unlikely the Commission will agree to such a statement, if the litigation and settlement proceed amicably, it is certainly worth attempting to negotiate the point.

Finally, the media statement will conclude with a statement of the EEOC’s mission (e.g. “The EEOC advances opportunity in the workplace by enforcing federal laws prohibiting employment discrimination”).  Additionally, where applicable, the statement will indicate where the resolved litigation is among the EEOC’s strategic goals — “[p]reventing workplace harassment through systemic litigation and investigation is one of the six national priorities identified by the Commission’s Strategic Enforcement Plan (SEP).”  Media statements that make note of the SEP are more likely to be among the more aggressive.

Emerging Issues With Media Statements

As the Commission media strategy has evolved, it has made continued efforts to increase its audience and distribution of these statements for maximum effect. The EEOC has also been known to conduct press conferences announcing a new suit or trumpeting an EEOC victory. But now the EEOC also publishes many of its media statements on social media, like Twitter.  It has also taken to issuing relevant media statements in multiple languages depending upon the employees and employer at issue. For as long as the EEOC places a priority on publicity, it will no doubt continue to search for new ways to increase their audience.

Implications for Employers

For employers who find themselves involved in an EEOC enforcement action, it is important not to lose sight of the Commission’s use of its media statement as both carrot and stick.  The EEOC places considerable value on shining a spotlight on its enforcement efforts, especially those which advance its strategic goals.  While it is unlikely that the Commission will allow the employer too much say in the issued statement, when negotiating resolution with the EEOC, where possible, employers should use the Commission’s goal of publicity as a possible bargaining chip to achieve the best possible outcome for the inevitable media statement.  Moreover, by understanding the Commission’s strategic goals, employers will gain a greater awareness of what tone and tenor the EEOC’s statement will take upon resolution, and can prepare accordingly.

 

Readers can also find this post on our Workplace Class Action blog here.

By Christopher J. DeGroffMatthew J. Gagnon,  Gerald L. Maatman, Jr., and Kyla J. Miller

Seyfarth Synopsis: The uncertainty of a new administration’s impact on the EEOC that plagued FY 2017 is fading, but the results are not what some would expect. Not only has the EEOC brought a mountain of filings compared to the last four years, but also the agency has demonstrated a clear focus on sex-based discrimination and sexual harassment in the workplace in light of #MeToo, even surpassing FY 2017 numbers.

With a full fiscal year under its belt, the Trump Administration’s impact on EEOC-initiated litigation is still uncertain. With two Republican Commissioners and the General Counsel position still unconfirmed, it is difficult to discern if things will truly be “business as usual” under Trump or if those appointments, once confirmed, will change agency course. One thing is certain: the EEOC’s litigation program is not slowing down any time soon. Just as the waning months of FY 2017 showed a marked increase in filings, FY 2018 turned up the heat even more. Filings are up more than ever, with sex discrimination filings and #MeToo filings – i.e., complaints of sexual harassment – eclipsing previous years.

The total number of filings in FY 2018 demolished FY 2015 and 2016, and even surpassed FY 2017. (Compare here to here and here). This year, the EEOC filed 217 actions, 197 merits lawsuits and 20 subpoena enforcement actions.

Predictably, the EEOC waited until the last minute to push filings, with this past month showing the most filings compared to any other month this fiscal year. At the time of publication, 84 lawsuits were filed in September, including 45 in the last 3 days alone.  Notable this year, however, was the “ramp up” period in June, July and August, which accounted for 63 of the total filings. Almost half of those cases were brought in August. The total filings for the remaining months remain low, with the number of filings in October through February failing to hit double digits.

Filings in Chicago, Philadelphia and Los Angeles continue to top the charts, with 21, 21, and 17 total filings, respectively. These numbers remain relatively consistent to FY 2017, which showed 21 filings in Chicago, 19 in Philadelphia, and 22 in Los Angeles. On the lower end, the St. Louis and Memphis numbers were modest, with only 7 filings in St. Louis and 8 filings in Memphis. Of the remaining districts, the Phoenix and New York district offices rebounded after a slow FY 2017, each filing 6 more lawsuits in FY 2018 as compared to last year.

Sex Discrimination Takes Center Stage

Each fiscal year we analyze what substantive theories the EEOC is targeting. This year, Title VII claims remained the largest category of filings, on par with FY 2017, which boasted 53% of all filings. In FY 2018, Title VII filings accounted for 55% of all filings. Although FY 2016 showed a dip in Title VII filings at 41%, this year’s Title VII filings beat out FY 2015 and FY 2014 as well.

With a new Strategic Enforcement Plan in place to guide litigation activity for FY 2018-2022, many expected some shift in focus based on two notable changes from the old plan. Specifically, the new plan pledged to address discriminatory practices against those who are Muslim or Sikh, or individuals of Arab, Middle Eastern, or South Asian descent. Additionally, the new plan aims to expand the EEOC’s equal pay priority to include compensation discrepancies for race, ethnicity, age, and disability – moving beyond the EEOC’s focus on sex-based pay disparities. In fact, we have actually seen a decrease in Equal Pay Act filings, which could reflect the EEOC’s renewed focus on equal pay issues that affect other protected groups, which would not fall under the jurisdiction of the Equal Pay Act.

One trend has emerged this year – compared to FY 2017, race filings have decreased by 6 filings – with 18 filings in FY 2018 compared to 24 filings in FY 2017.

Perhaps the most striking trend of all is the substantial increase in sex-based discrimination filings, primarily the number of sexual harassment filings. As predicted, #MeToo added fuel to this area of the EEOC’s agenda, with 74% of the EEOC’s Title VII filings this year targeting sex-based discrimination. Compare this to FY 2017, where sex based discrimination accounted for 65% of Title VII filings. Of the FY 2018 sex discrimination filings, 41 filings included claims of sexual harassment. 11 of those filings were brought in the last three days of the fiscal year alone. The total number of sexual harassment filings was notably more than FY 2017, where sexual harassment claims accounted for 33 filings.

EEOC’s #MeToo Harassment Filing Surge

Implications For Employers

The dramatic increase in filings should be an eye-opener for employers in an era when many thought the EEOC might be hitting the brakes. Instead, the EEOC is increasing its enforcement activity, with a particular focus on sex discrimination and sexual harassment. The EEOC still strongly advises employers should update and aggressively enforce their EEO Policies. Now, more than ever, employers need to be on top of their game to avoid becoming the next target of EEOC-initiated litigation.

As most of our loyal readers know, this blog is merely a preview of the more extensive analysis of EEOC trends and developments affecting EEOC litigation that we publish at the end of the calendar year. Stay tuned for our in-depth analysis of FY 2018 filings, and particular danger areas for employers in this shifting political climate.

Readers can also find this blog post on our EEOC Countdown blog here.

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis: A federal district court in Kansas recently granted the EEOC’s motion for judgment on the pleadings in an ADA lawsuit brought against UPS and an employee union, holding that a policy in Defendants’ collective bargaining agreement where drivers who are disqualified for medical reasons can only be compensated at 90% of their rates of pay for temporary non-driving jobs, while drivers disqualified for non-medical reasons such as DWI’s are compensated at a 100% rate, was facially discriminatory.

This ruling should serve as a wake-up call to employers in regards to ensuring their policies relative to medical disqualifications and compensation are ADA-compliant.

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Case Background

In EEOC v. UPS Ground Freight, Inc., No. 2:17-CV-2453, 2018 U.S. Dist. LEXIS 125625 (D. Kan. July 27, 2018), the EEOC brought suit under the ADA regarding UPS’s collective bargaining agreement (“CBA”) with its employees’ union, which provided that for employees with CDL’s (commercial drivers’ license) whose CDLs are suspended or revoked for non-medical reasons, including convictions for driving while intoxicated, those employees would be reassigned to non-CDL required (non-driving) work at their full rate (100%) of pay. However, for drivers who become unable to drive due to medical disqualifications, including drivers who are individuals with disabilities within the meaning of the ADA, UPS provided full-time or casual inside work at only 90% of the rate of pay.

The EEOC argued that the language of the CBA established a prima facie case of a discriminatory policy because it paid drivers disqualified for non-medical reasons 100% of their pay rate, while paying drivers disqualified for medical reasons 90% of the appropriate rate of pay for the work being performed. Id. at 5. UPS responded by arguing that judgment on the pleadings was inappropriate because: (1) the EEOC relied upon a selective and erroneous interpretation of the CBA; (2) the CBA contained ambiguities that precluded judgment; (3) “whether the CBA works to the benefit or detriment of a medically disqualified driver depends entirely on the particular factual scenario in each case,” which required the Court to engage in a case-by-case analysis to determine if an employee has been discriminated; and (4) the CBA did not limit the opportunities available to individuals with disabilities, but provided additional opportunities beyond what the ADA required. Id.

The Court’s Decision

The Court granted the EEOC’s motion for judgment on the pleadings.

First, the Court held that the CBA’s language was plain and unambiguous, and further, that it was “immaterial whether medically disqualified drivers have other options; paying employees less because of their disability is discriminatory under any circumstance.” Id. at 5-6. Further, the Court held that the alleged ambiguities that precluded judgment in the EEOC’s favor were attempts to create confusion where none existed. Specifically, the Court opined that UPS’s arguments were “red-herrings because they fail[ed] to address the pertinent issue — pay at less than 100% based on disability.” Id. at 6.

Turning to UPS’s argument that a case-by-case impact analysis was required to show that the policy was facially discriminatory, the Court rejected this argument, explaining that “[a]t the liability stage in a pattern-and-practice claim, the plaintiff must show that unlawful discrimination is part of the employer’s ‘standard operating procedure.’” Id. The Court further explained that under this standard, the government must establish a prima facie case of a discriminatory policy, but it was not required to offer evidence that each individual who may seek relief was a victim of the policy. As such, the Court held that the EEOC met its burden in establishing that the CBA was facially discriminatory.

Finally, the Court rejected UPS’s argument that he CBA did not limit the opportunities available to individuals with disabilities. The Court instead held that UPS did not provide a legitimate reason for paying medically disqualified drivers performing “inside work” less than those disqualified for other reasons under the CBA, and therefore failed to overcome the EEOC’s prima facie case of discrimination. Id. at 7.

In regards to injunctive relief, the Court held that the EEOC demonstrated that its claim warranted a permanent injunction. Id. at 7-8. Noting that monetary damages cannot prevent future harm, the Court opined that “[t]he only ‘hardship’ UPS Freight will suffer is paying medically disqualified drivers more (100% pay rate), which is the same rate it already pays its other, non-disabled employees.” Id. at 8. After further holding that the public interest will not be harmed by a permanent injunction prohibiting UPS from discriminating on the basis of disability, the Court ordered the next collective bargaining agreement is to prohibit the same discriminatory practice. Accordingly, the Court granted the EEOC’s motion for judgment on the pleadings and thereby granted its motion for injunctive relief.

Implications For Employers

For employers who provide alternative work assignments to employees with medical disqualifications, this ruling should serve as an eye-opener. It is crucial that businesses examine the compensation for such employees to confirm they are not being compensated at a disproportionally lower rate than other non-medically disqualified employees who are reassigned. Accordingly, a best practice for employers is to routinely examine their policies regarding medical disqualification and compensation to ensure they are complying with the ADA, in order to prevent EEOC-initiated litigation.

Readers can also find this post on our Workplace Class Action blog here.

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis: In an EEOC-initiated systemic lawsuit alleging that a senior living and nursing facility operator violated the Americans With Disabilities Act (“ADA”) by failing to offer employees light duty as a reasonable accommodation and ignoring its obligation to engage in an interactive process, a federal district court in California recently granted in part the employer’s motion to dismiss the claims of eight specifically identified claimants, holding that the EEOC failed to sufficiently allege that these individuals had a disability or could perform essential job functions.

For businesses facing EEOC-initiated litigation relative to disability discrimination, this ruling provides a blueprint for attacking such claims at the pleading stage.

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Case Background

In EEOC v. Prestige Care, Inc., Case No. 1:17-CV-1299, 2018 LEXIS 119305 (E.D. Cal. July 17, 2018), the EEOC brought a systemic lawsuit on behalf of thirteen identified claimants for violations of the ADA. Prestige manages nursing care facilities and senior assisted living facilities in California, Oregon, Washington, Alaska, Idaho, Montana, Nevada, and Arizona. Id. at *3. The EEOC alleged that Prestige implemented and followed policies that violated the ADA, including: (1) a “100% healed/100% fit for duty” return to work policy; (2) not offering light duty as a reasonable accommodation; and (3) ignoring its obligation to engage in an interactive process. Id. The EEOC argued that these policies did not permit reasonable accommodations for qualified individuals.

In its motion to dismiss, Prestige argued that the EEOC’s complaint was deficient as to ten of the thirteen claimants identified by the EEOC since it failed to allege they had impairments that affected a major life activity, or failed to identify essential job functions. Id. Without such allegations, Prestige argued there were no plausible ADA claims with respect to the ten claimants. In response, the EEOC argued that dismissal was inappropriate because the allegations stated plausible claims, including on behalf of unnamed individuals. Further, the EEOC argued that it would be premature to dismiss without the benefit of discovery as to the specific individuals.

The Court’s Decision

The Court granted Prestige’s motion to dismiss the EEOC’s claims as to the eight claimants while denying Prestige’s motion as to two claimants. The Court first addressed the EEOC’s arguments (1) that no challenge with respect to claimants was appropriate because it was not a proxy for any individual claimant or charging party; (2) Rule 23 does not apply to the Commission’s lawsuits or when a § 706 claim is pursued; and (3) the EEOC is not required to identify each member of the class to recover. Id. at *5. Noting that “none of these positions adequately address the issue at hand,” the Court explained that Prestige did not argue that Rule 23 applied in this case, nor did it attempt to impose any of Rule 23’s requirements on the EEOC. Further, Prestige did not argue that the EEOC must identify each person for whom recovery is sought. Rather, Prestige was simply raising the question of how to review the allegations concerning the persons that the EEOC chose to identify. As such, the Court held that when the EEOC pursues a systemic claim under § 706 and chooses to identify additional persons who have suffered some form of disability discrimination, the allegations must plausibly show that those “additional individuals” are protected by the ADA. Id. at *6.

The Court then addressed the sufficiency of the allegations as to each of the ten identified claimants that were the subjects of the motion to dismiss. In moving to dismiss the claims of eight of the ten claimants, Prestige primarily challenged the allegations by arguing (1) the EEOC did not identify or allege that a major life activity was affected; (2) the essential functions of the job were not identified; and (3) there were no indications that the aggrieved individual could have performed the essential functions of the job with or without accommodation. Id. at *8-11. For several claimants, the Court held that while the EEOC would identify a physical impairment in its complaint, for instance, plantar fasciitis, it failed to adequately identify a major life activity that was substantially affected by the condition (such as walking or standing, for the claimant with plantar fasciitis). Id. at *17. Regarding the EEOC’s failure to plead the essential job functions, by way of example, the Court noted that for a laundry worker claimant with PTSD and anxiety, the EEOC failed to identify any essential functions of the job, and therefore could not show she was qualified. Id. at *22. Accordingly, the Court granted the motion to dismiss eight of ten identified claimants.

In denying the motion to dismiss as to two of the ten claimants, the Court explained that the allegations were sufficient to plausibly show that the claimants were “qualified individual[s] with a disability.” Id. at *18-19. For instance, the Court held that for a claimant who disclosed a nerve condition that was adversely affected by standing for longer than 15 minutes and lifting heavy objects, the EEOC alleged that Prestige still hired him as a cook, and therefore believed that he could perform the essential functions of that position. As such, the Court held that dismissal of this claimant as a class member would be inappropriate. Id. at *19. Accordingly, the Court denied the motion to dismiss two of the ten claimants.

Implications For Employers

This ruling provides an excellent framework for employers in regards to attacking disability discrimination claims where the EEOC identifies multiple claimants. Employers can rely on the Court’s analyses relative to (1) how the EEOC often failed to identify a major life activity that was substantially affected by the physical impairment it identified; and (2) how the EEOC frequently failed to provide any information whatsoever about essential job functions in its pleading.

But despite dismissing eight of the ten claimants, it is noteworthy that the dismissals were without prejudice. Id. at *22-23. The Court held that the EEOC may file an amended complaint that addresses and corrects the deficiencies with respect to these eight alleged claimants. As such, even though the employer emerged largely victorious in this battle, the Court nonetheless afforded the EEOC a second bite of the apple to remedy its largely deficient pleading.

Readers can also find this post on our Workplace Class Action Blog here.

 

By Scott Rabe and Sam Schwartz-Fenwick

Seyfarth Synopsis: In landmark decision, the Second Circuit joined the Seventh Circuit in holding that Title VII prohibits discrimination on the basis of sexual orientation as a subset of sex discrimination. The ruling is important for all employers given the stakes in this litigation over the scope of federal workplace bias laws.

In a landmark decision in Zarda v. Altitude Express, Inc., No. 15-3775, the Second Circuit ruled en banc that Title VII prohibits discrimination on the basis of sexual orientation as a subset of discrimination on the basis of sex. The Second Circuit has now joined the Seventh Circuit, the EEOC, and a number of district and administrative courts across the country that have interpreted Title VII to extend its prohibition of sex discrimination to sexual orientation.  Chief Judge Katzmann authored the decision for the plurality, in which four judges joined in full, five judges joined in part, and to which three judges dissented.  In total, eight of the thirteen judges issued an opinion.

In Zarda, a former skydiving instructor sued his employer, alleging that he was terminated from his job after he revealed to a customer that he was gay.  Specifically, he alleged sex discrimination under Title VII and asserted that his employment was terminated because he failed to conform to male sex stereotypes because he was gay.  The district court dismissed Zarda’s Title VII claim at the summary judgment stage, holding that, although there was sufficient evidence to permit his claim for sexual orientation discrimination to proceed under New York law, which explicitly prohibits discrimination on the basis of sexual orientation, plaintiff had failed to establish a prima facie case of gender stereotyping under Title VII based on his sexual orientation.  The district court explained that in reaching this decision it was constrained by Second Circuit precedent in Simonton v. Runyon and Dawson v. Bumble & Bumble, which held that Title VII did not prohibit discrimination on the basis of sexual orientation. On appeal, the Second Circuit reversed, and in doing so, explicitly stated that it was overturning its prior opinions in Simonton and Dawson.

In the plurality opinion, Judge Katzmann explained that sexual orientation discrimination should be treated as a subset of sex discrimination for several reasons.  He observed that “sexual orientation is defined by one’s sex in relation to the sex of those to whom one is attracted,” that “sexual orientation discrimination is . . . based on assumptions or stereotypes about how members of a particular gender should be, including to whom they should be attracted,” and that “sexual orientation discrimination is associational discrimination because an adverse employment action that is motivated by the employer’s opposition to association between members of particular sexes discriminates against an employee on the basis of sex.”   The plurality also found compelling that, while the consensus among federal circuits and the EEOC in 2000 at the time of Simonton was that Title VII did not protect against discrimination on the basis of sexual orientation, the EEOC and the Seventh Circuit both changed their stance on this issue and judges across the country continue to analyze this evolving issue.

The main dissent, written by Judge Lynch and joined in part by two circuit judges, argued primarily that under a strict textual interpretation of Title VII, the statute did not protect against discrimination on the basis of sexual orientation, as it is clear Congress could have but did not include sexual orientation as a protected class.  This is the same rationale employed in 2017 by the Eleventh Circuit in Evans v. Georgia Regional Hospital, which held in a divided opinion that Title VII’s prohibition on sex discrimination does not encompass discrimination on the basis of sexual orientation.

The Second Circuit’s decision widens the circuit split on this issue.  Further, the diverse array of opinions among the judges on the Second Circuit mirrors the nationwide divergence in views regarding the protections that Title VII affords employees based on their sexual orientation.  While the EEOC has now taken the clear position that discrimination against workers because they are lesbian, gay, or bisexual is sex discrimination under Title VII, the U.S. Department of Justice has issued guidance and sought to enforce an interpretation of Title VII that discrimination on the basis of sexual orientation is not prohibited under Title VII as sex discrimination.  Circuit, district, and administrative courts are also split.  With the circuit divide, complicated by vastly divergent interpretations of Title VII by the very agencies entrusted to enforce Title VII, the issue is poised for review by the U.S. Supreme Court.

Implications For Employers

In light of the current uncertainty regarding the ultimate interpretation of Title VII as it applies to sexual orientation, as well as gender identity, see our prior post, and because numerous state and local laws already explicitly prohibit discrimination on the basis of sexual orientation, employers should regularly review their policies to ensure that adequate protections are provided to employees on the basis of their sexual orientation or gender identity.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of Seyfarth Shaw’s Workplace Policies and Handbooks Team or the Labor & Employment Team.

 

By: Gerald L. Maatman, Jr.Christopher J. DeGroffMatthew J. Gagnon, and Kyla Miller

Seyfarth Synopsis: We are once again pleased to offer our loyal blog readers a breakdown of the five most intriguing developments in EEOC litigation in 2017, in addition to a pre-publication preview of our annual report on developments and trends in EEOC-initiated litigation. This year’s book, titled EEOC-Initiated Litigation: FY 2017, provides a comprehensive examination of the EEOC’s FY 2017 filings (from October 2016 through September 2017), and the major decisions handed down this year in pending EEOC litigation.

In our view, every employer should be monitoring EEOC activity – it is the surest way to avoid becoming the EEOC’s next target. That is why we conduct a thorough analysis of all EEOC activity every year to keep our readers up to date on current trends and, hopefully, provide a peek inside the EEOC’s decision-making process. Our annual report is targeted towards HR professionals, corporate counsel, and other corporate decision-makers. We hope that it proves useful as they attempt to steer clear of EEOC-initiated litigation in FY 2018.

This year, we have once again categorized our analysis of substantive developments in line with the EEOC’s strategic priorities. This year is the first year of the EEOC’s new Strategic Enforcement Plan, which covers Fiscal Year 2017 through 2021. The new SEP advances the same six strategic priorities as the previous strategic plan. It has been our experience that analyzing developments in EEOC litigation in light of the SEP priorities provides a better understanding of the EEOC’s focus and agenda.

The full publication will be offered for download as an eBook. To order a copy, please click here.

As always, we like to take a moment at the end of one year, and the beginning of the next, to look back at the most intriguing decisions and developments of the year.

Here is our list of the “top five” most intriguing developments of 2017.

A Year Of Transition: Litigation On Track Despite Changes On The Way

FY 2017 was a year of transition for the EEOC. It is still too early to tell how the changed political landscape will impact the future of EEOC litigation given the important positions that remain vacant for high-level agency personnel. But this did not stop the EEOC from charging full speed ahead. Total merits filings were up more than 100% over FY 2016. In fact, the EEOC filed more lawsuits in September than it did in all of FY 2016 combined. Although the 2017-2021 Strategic Enforcement Plan maintains its focus on the same six strategic enforcement priorities, it added two substantive areas as emerging issues, including complex employment relationships and “backlash discrimination” against Muslims, Sikhs, and other persons of Arab, Middle Eastern, or South Asian descent. Those are important issues to watch in FY 2018 and beyond. Our analysis of these issues can be found here.

A New Standard Of Review For EEOC Subpoena Enforcement Actions

In McLane Co. v. EEOC, the U.S. Supreme Court clarified the scope of review for appellate courts reviewing a lower court’s decision to enforce (or not) an EEOC administrative subpoena. In McLane, the Supreme Court held that such decisions are reviewable under the abuse-of-discretion standard, which is more akin to a hands-off type of review. The decision clarified that the District Courts should subject EEOC subpoenas to a searching, fact-intensive review, and that their judgment in this respect should be respected by the appellate courts. Although ostensibly a win for the EEOC, the decision makes it clear that the District Court cannot simply presume the relevance of information or documents the EEOC seeks with its administrative subpoenas. Instead, a District Court must give serious consideration to issues of relevancy and burden when deciding whether or not to enforce an EEOC subpoena. Our analysis of this trend can be found here.

Developments In Religious Discrimination Law: Accommodations May Be Required For Wide Swath Of Beliefs

In EEOC v. Consol Energy, Inc., the Fourth Circuit expanded the scope of religious accommodation requests employers must consider. In Consol, the EEOC alleged that the defendants refused to provide an employee with a religious accommodation by subjecting him to a biometric hand scanner to clock in and out of work. The employee believed a hand scanner was used to identify and collect personal information that would be used by the Christian Anti-Christ to identify followers with the “mark of the beast,” as described in the New Testament Book of Revelation. The Fourth Circuit affirmed the judgment of the District Court against the employer, finding that a religious accommodation was necessary. Our discussion of this development can be found here.

Sexual Harassment In The Workplace: Focus on “Manager”

Given all the recent news about sexual harassment in the workplace, and the fast developing #MeToo movement, we suspect that the EEOC is already preparing for an uptick in sexual harassment complaints in FY 2018. But recent decisions show that not all complaints alleging sexual harassment are a slam dunk for employees. In EEOC v. Autozone, Inc., the Sixth Circuit affirmed a U.S. District Court’s grant of an employer’s motion for summary judgment after finding that the harassing managerial employee was not a “supervisor” under Title VII. The employer was thus not liable for the employee’s actions. The Sixth Circuit held that just because someone is titled a “manager” does not necessarily mean that they are “supervisors” under Title VII. They must have the authority to take an employment action against the complaining employee. A further discussion on this development can be found here. We expect decisions in FY 2018 will dramatically reshape the landscape of harassment law, with the EEOC leading the way.

EEOC’s Penchant For Expanding Pattern Or Practice Cases

In FY 2017, the EEOC continued to try to expand its powers to prosecute large-scale pattern or practice cases. In EEOC v. Bass Pro Outdoor WorldLLC, a District Court in Texas was willing to reign it in. In that case, the EEOC attempted to add claims on behalf of individuals who had not yet applied to work for Bass Pro at the time the EEOC tried to conciliate its claims against Bass Pro. Title VII requires the EEOC to attempt to resolve charges of discrimination against an employer through means of conciliation before it seeks redress in the courts. In this case, the District Court was unwilling to allow the EEOC to add claimants on behalf of whom it could not have conciliated prior to bringing its lawsuit. A closer look at this development can be found here.

Although we are almost a full year into the Trump Administration and Republican control of Congress, it is still unclear what those political developments will mean for the future of EEOC litigation. The enforcement priorities are the same as the past four years. But how the EEOC chooses to interpret those priorities will undoubtedly change as high-level positions are filled by the Trump Administration. This makes FY 2018 a year of uncertainty as we await those changes in EEOC leadership. We look forward to keeping our readers apprised of these changes as they occur!

Readers can also find this post on our Workplace Class Action blog here.

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis:  In an ADEA action brought by the EEOC alleging that the New Mexico Department of Corrections failed to promote correctional officers over the age of 40, a federal district court in New Mexico denied the employer’s motion to dismiss but ordered the EEOC to file a supplemental pleading identifying previously unnamed aggrieved parties.

For employers facing EEOC age discrimination claims, this ruling provides insight into how to attack allegations relative to unidentified aggrieved individuals and to flush out the true size and scope of an EEOC systemic lawsuit.

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In EEOC v. State of New Mexico, Dep’t of Corrections, No. 15-CV-879, 2017 U.S. Dist. LEXIS 198770 (D.N.Mex. Dec. 4, 2017), the EEOC alleged that from January 2009 to at least December 2014, the New Mexico Department of Corrections (“NMDC”) denied employment opportunities to three specific workers and a group of unidentified aggrieved individuals aged 40 and over on the basis of their age.  The NMDC moved to dismiss with respect to the unidentified aggrieved individuals, arguing those claims were insufficiently plead, and further, that the EEOC failed to provide sufficient notice about any additional aggrieved individuals during the pre-filing conciliation period.

The EEOC moved to convert the motion to dismiss to a motion for summary judgment after the NMDC attached to its motion exhibits relating to the EEOC’s investigation and conciliation.  Judge Kenneth J. Gonzales of the U.S. District Court for the District of New Mexico denied both motions, but  ordered the EEOC to file a supplemental pleading listing the names of each aggrieved party.

Employers can use this decision in ADEA litigation to argue that the EEOC should identify any unnamed aggrieved individuals at the outset of litigation. In this respect, it is a key ruling for employers.

Case Background

The EEOC alleged that the NMDC failed to promote three correctional officers to various positions at the Central New Mexico Correctional Facility because they were over the age of 40.  The former warden allegedly told the officers that “while [two Claimants] were qualified for the [position], he selected a 31-year-old candidate because he was looking for someone with ‘longevity.’”  Id. at *2.  The EEOC also alleged that the warden: (1) made many of the decisions to deny employment opportunities to older workers; (2) used ageist comments about longevity, preferring younger workers, and not promoting employees near retirement; and (3) instilled a culture of age discrimination that continued to be applied by the NMDC.  As such, the EEOC sought an injunction requiring policy changes and money damages for any individual adversely impacted by the discrimination.

Arguing that the EEOC failed to provide sufficient notice about any additional aggrieved individuals during the pre-filing conciliation period, the NMDC moved to dismiss the amended complaint.  In support of its motion, NMDC sought to offer several exhibits, including: (1) requests for information propounded on the NMDC by the EEOC; (2) the EEOC’s letter to the NMDC’s employees soliciting information or claims; and (3) letters and e-mails between the parties relating to EEOC’s efforts at conference, conciliation, and investigation.  Id. at *5.  The EEOC argued that if the Court was willing to entertain evidence regarding pre-filing communications, then the motion to dismiss should be converted to a motion for summary judgment.  Id. at *3.

The Court’s Decision

The Court denied the NMDC’s motion to dismiss, denied the EEOC’s motion to convert the convert the motion to dismiss to a motion for summary judgment, and ordered the EEOC to file a supplemental pleading listing the names of each aggrieved party involved in this lawsuit.  First, the Court addressed the NMDC’s argument that the exhibits were “implicitly referenced” in the EEOC’s allegations regarding its pre-filing investigation.  Id. at *5.  The Court rejected this argument, opining that “implicit, subtle, or passing references to extraneous evidence” did not justify their inclusion.  Id.  As such, the Court excluded the NMDC’s exhibits, and therefore denied the EEOC’s motion to convert.

Second, the Court addressed the NMDC’s argument that the Court should consider the lack of actual pre-litigation notice as part of the notice pleading inquiry, including its knowledge about the potential number of claimants, facilities, and wrongdoers.  Id. at *6.  According to the NMDC, any potential recovery should be limited to the claimants the EEOC actually knew about when conciliation concluded in September of 2013.  The Court held that it would allow the parties to amend their pending summary judgment motions to supplement any evidence and arguments regarding actual pre-litigation notice and timeliness, but that “a motion to dismiss typically is not the correct vehicle for determining whether a claim is barred based on when it arises.”  Id. at *7.

Third, the Court addressed the NMDC’s argument that the EEOC failed to meet the pleading standards defined in Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009), and Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).  The Court opined that there is no binding case law addressing how much information the EEOC’s complaint must provide about unidentified parties.  Id. at *9.  Further, it instructed that courts are more permissive about the class-type allegations where the complaint is very specific about the charging parties.  Id. at *10 (citations omitted).  Applying these principles, the Court held that the complaint stated a plausible claim for relief on behalf of the unidentified aggrieved individuals since it described the types of discrimination at issue (age); the group of workers (NMDC workers over the age of 40); and the duration of the discriminatory conduct (since 2009 and ongoing).  Id.  Accordingly, the Court denied the NMDC’s motion to dismiss.

Finally, at oral argument, the EEOC offered to file an amended complaint to satisfy the party plaintiff rule, if the Court found it applied.  Id. at *12.  Instructing that the ADEA incorporated the requirements of 29 U.S.C. § 216(c), the Court ordered the EEOC to identify each aggrieved individual in the record by filing a supplemental pleading.  Id. at *11-12.  The Court also permitted the NMDC the option to file a response, but advised that the Court would prefer to address additional substantive arguments through the summary judgment proceedings.  Accordingly, the Court denied the NMDC’s motion to dismiss, denied the EEOC’s motion to convert the convert the motion to dismiss to a motion for summary judgment, and ordered the EEOC to file a supplemental pleading listing the names of each allegedly aggrieved worker on whose behalf the EEOC sought recovery.

Implications For Employers

In its Strategic Enforcement Plan for Fiscal Years 2017-2021, the EEOC identified eliminating barriers in recruitment and hiring as one of its six priorities (as we blogged about here).  One of the prime areas where the EEOC has been targeting employers involves age discrimination.  This litigation should put employers on notice that promotional and hiring decisions will be closely scrutinized by the EEOC.

Further, although the Court did not reach the issue of whether the EEOC fulfilled its conciliation obligations with respect to the unnamed group of allegedly aggrieved individuals, this employer’s attack of the EEOC’s failure to fulfill its pre-suit obligations under Title VII resulted in the Court ordering the Commission to file a supplemental pleading identifying such individuals.  Although the employer’s motion to dismiss was denied, employers can cite to this ruling in ADEA litigation when arguing that the EEOC should “put its cards on the table” and disclose who exactly is part of the lawsuit.

Readers can also find this post on our Workplace Class Action blog here.