On November 18, 2014, the EEOC released its 2014 Performance and Accountability Report (“PAR”). The Report is an annual scorecard of sorts for the EEOC. It reflects the progress of the EEOC’s continued efforts to follow enforcement priorities outlined in its 2012 strategic enforcement plan (“SEP”) (read more here), including its systemic litigation initiative.
The Report ought to be required reading for any corporate counsel involved in compliance efforts relative to workplace laws. Upon reviewing the Report, one might ask if the Commission is doing its job in fair and effective fashion.
By way of background, the launch of the SEP underscored the EEOC’s efforts to champion bigger, more media-focused “systemic” cases, including pattern or practice cases where the alleged discrimination “has a broad impact on an industry, occupation, business, or geographic area.” In the SEP, the EEOC set forth a goal to ensure that systemic cases make up at least 20% of its annual litigation docket and at least 22% to 24% of its litigation docket by 2016.
In its 2014 PAR, the EEOC reported that it has continued to implement its SEP and has met, partially met, or exceeded its target results. Or so the Commission claims…
The EEOC’s Overall Results
The EEOC’s results reflect a mixed bag for employers, with fewer systemic lawsuits filed (17 in 2014, compared with 21 in 2013), but more on-going systemic lawsuits in the court system (57 in 2014, compared with 54 in 2013), and far more pre-lawsuit settlements (78 in 2014, compared with 63 in 2013).
Overall, we do not expect the EEOC to back off its systemic initiative in 2015, and but to be more aggressive in pursuing those cases that fit within its agenda. So numbers aside, these metrics reflect an agency committed to “big impact” lawsuits that “send a message” to the employer community.
In its 2014 PAR, the EEOC reported that, in fiscal year 2014, the EEOC filed 133 merits lawsuits, 17 (13%) of which were systemic suits. At the end of fiscal year 2014, the agency had 228 cases on its active docket, of which 57 (or 25%) involved challenges to systemic discrimination. As a percentage, this represents the largest proportion of systemic suits on the EEOC’s active docket since tracking began in 2006. Yet, at the same time, the numbers are down, not up. One explanation is that the EEOC has pursued expensive, time-consuming cases, and it lacks the resources to increase its docket.
With respect to investigations, the agency reported that it, in fiscal year 2014, it completed 260 systemic investigations. The EEOC resolved 78 (30%) of those by voluntary agreements, including 34 pre-determination settlements before any findings of discrimination and 44 conciliation agreements. The EEOC secured $13 million in monetary relief.
These numbers are down from fiscal year 2013 in several categories. In 2013, the EEOC reported that it had filed 131 merits lawsuits, 21 (16%) of which were systemic suits. At the end of fiscal year 2013, the EEOC had 231 cases on its active docket, of which 54 (23%) involved challenges to systemic discrimination. And, by the end of 2013, the EEOC had launched 300 systemic investigations, resulting in 63 settlements or conciliation agreements that recovered approximately $40 million.
According to the PAR, based on the volume of systemic charges currently in investigation, the EEOC expects the quantity of systemic lawsuits and their representation on its total docket to remain high. As defense counsel in many of these cases, we sense the EEOC means what it says.
As we discussed in previous blog posts (read more here), the SEP also reinforced the Commission’s efforts to continue addressing emerging and developing legal theories. To that end, in 2014, the EEOC launched a series of novel attacks that sought to expand the reach of Title VII. Those efforts, to put it mildly, met some resistance. One view is that these efforts to “push-the-envelope” backfired, and represented wasteful expenditures of time and costs, with little to nothing to show for it.
For example, most notably, on October 7, 2014, in EEOC v. CVS Pharmacy, Inc., Case No. 14-CV-863 (N.D. Ill.), Judge John Darrah of the U.S. District Court for the Northern District of Illinois dismissed the EEOC’s efforts to challenge provisions of CVS’s settlement agreements, holding that there is no separate cause of action for “resisting” employment laws. (Read more here.) On November 6, 2014, in EEOC v. Honeywell International, Inc., Case No. 14-CV-4517, 2014 U.S. Dist. LEXIS 157945 (D. Minn. Nov. 6, 2014), Judge Ann Montgomery of the U.S. District Court for the District of Minnesota denied the EEOC’s request for a preliminary injunction to prevent Honeywell from levying penalties against employees who refuse to participate in Honeywell’s corporate wellness program. (Read more here.)
Thus far, the EEOC has experienced more defeats than successes when it comes to expanding the frontiers of employment discrimination laws.
Implications For Employers
Although the EEOC filed fewer systemic cases in fiscal year 2014, and completed fewer systemic investigations, it settled a higher number of systemic cases pre-litigation — but for less money. We expect the trends revealed by the 2014 numbers to continue. We expect the EEOC to continue to search for and to initiate systemic investigations, but to focus its efforts and invest its resources on those cases that it views as priority cases, including those that seek to expand the reach of Title VII. In spite of several stunning defeats, we do not expect the EEOC to back down on its systemic initiative in 2015. Rather, we anticipate that those defeats will inspire the EEOC to more aggressively pursue those actions that fit within its agenda.