The EEOC’s Fiscal Year will end on September 30. And, as is usually the case, most EEOC District Offices will make a special effort to close out as many pending charges as possible, without compromising the investigative or conciliation processes, in order to increase the number of Charge Resolutions for the current Fiscal Year. This special effort usually takes the form of one or more of the following types of action by the EEOC Investigator:
- The EEOC Investigator assigned to process the charge will call the employer and suggest a settlement upon more reasonable terms than the Commission might have offered earlier in the year. This is particularly so if the case involves only issues of individual harm to one charging party and the facts in the case are debatable.
- The EEOC Investigator will call or write to inform the employer that the Commission will deem conciliation to have failed if the parties cannot come to some agreement by a date certain, which will usually be a relatively short time, for example ten days. This is particularly so if the case involves a small potentially- affected class and conciliation efforts have been protracted over several months.
- The EEOC Investigator abruptly calls the employer for a predetermination conference, advises the Employer’s Representative that the EEOC intends to issue a Reasonable Cause finding and asks if the employer has any additional evidence to prove that the law has not been broken.
The foregoing should not be read to imply that the EEOC never offers reasonable settlements when there is no pressure to close out the current Fiscal Year. In fact, the EEOC likes to think that all of its settlement offers are very reasonable. However, if the charge has been pending for over a year, or so, and it is August or September, the employer would be well advised to look for some action by the EEOC to move the charge along.
Obviously, this could work to an employer’s favor or disfavor depending on the circumstances. The question is whether it would be to the employer’s advantage dollar- wise to settle the charge at this point or allow conciliation to fail risking a lawsuit either by the Charging Party or the EEOC. Obviously, legal counsel should be consulted about this decision. Either way, among the considerations that an employer must make are:
- Whether the employer believes, based on solid legal grounds, that no violation has occurred and there is no fear of a “reasonable cause finding” or subsequent “failure of conciliation.” (As to this option it should be remembered that the EEOC’s “reasonable cause findings” are just that, only a reasonable cause to believe that the law has been violated, not a court judgment that in fact a violation has been found.)
Whether it is possible that a violation did occur, and, whether (in the long run or short run) it would cost more to litigate the issues in the charge or to settle it now.
hus, there is usually no easy answer, but as a starting point it might be of interest to compare the monetary relief obtained on behalf of charging parties through the EEOC’s administrative process to the amounts obtained the Commission obtained through litigation it prosecuted over the past three fiscal years. The following tables show the differences between the average amounts obtained from both sources by the EEOC during Fiscal Years 2012 through 2014:
Click here to view table.
The Table shows that of the cases resolved by Employers and the EEOC through the Administrative Process during Fiscal Years 2012 through 2014, the settlements ranged, from $19,062 to $21,098 per cases resolved.
As to cases litigated the result is significantly different as shown in Table 2:
Click here to view table.
As might be expected, the average amount obtained by the EEOC per case through litigation is considerably higher than the average amount obtained per case resolved during the administrative process. This is because the EEOC litigates very few cases and, of the cases it chooses to litigate, it typically chooses cases where a policy, practice, or bad actor has affected a large class of employees.
Accordingly, employers should be comforted by the fact that the EEOC does not and cannot litigate every reasonable cause finding leading to a failed conciliation. In fact, for FY 2012 through 2014, EEOC statistics showed that there were 2,616; 2,078; and 1,714 Failures of Conciliation. In those same years the EEOC only filed 122, 131, and 133 Merit Suits, respectively. Fewer than 10% of the Failures of Conciliation were litigated by the EEOC.
Does this mean that there is a 90% chance that an Employer will be “off the hook” even if conciliation fails? No, because of course there is always the prospect of a lawsuit brought by a private attorney. Reliable statistics as to the number of private lawsuits filed compared to the number of failures of conciliation on a yearly basis are not readily available. However, it is clear that, collectively, significantly more lawsuits are filed by the private bar than the EEOC.
Thus, there is no simple answer as to when, if at all, to settle. That is a question that in the end should be carefully deliberated by an Employer and its legal counsel. The strength of the EEOC’s case after weighing all of the relevant evidence as well as the “nuisance value” of avoiding the vagaries of litigation should of course be important factors in this determination.
On the other hand if the case involves an EEOC Priority Issue (currently for example “LGBT” issues), or a significant affected class of employees or is systemic in nature, the EEOC, probably, will be less interested in settling early without major concessions, including press releases. But it never hurts to try to settle a charge on your own terms, if possible, especially during August or September, the end of the EEOC’s fiscal year.