Practical Considerations for General Counsel to Decrease Liability & Manage EEOC Investigations

Practical Considerations for

General Counsel to Decrease

Liability & Manage EEOC

Investigations

Speaker Info Eric S. Dreiband, Partner, Jones Day

Eric Dreiband represents companies in all aspects of civil rights, employment discrimination, whistleblower, and wage and hour investigations, litigation, and counseling.

Eric previously served as the general counsel of the U.S. Equal Employment Opportunity Commission. He directed the federal government's litigation of Title VII of the Civil Rights Act of 1964 and several other federal employment antidiscrimination laws. He also issued the Regional Attorneys' Manual, which established the policies of EEOC's litigation program.

Prior to his EEOC service, Eric served as deputy administrator of the U.S. Department of Labor's Wage and Hour Division. He directed the federal government's enforcement of the Fair Labor Standards Act, the Family and Medical Leave Act, and other laws. For his contribution to the DOL's efforts to update its overtime regulations, he received the Secretary of Labor's Exceptional Achievement Award. Eric also received the Secretary of Labor's Compliance Assistance Award for leading the DOL's efforts to increase compliance with the federal child labor laws.

From 1997 to 2000, Eric served in the Office of Independent Counsel Kenneth W. Starr. The Federal Deposit Insurance Corporation awarded him a special commendation after he led the investigation and successful prosecution of a former associate attorney general of the United States.

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Practical Considerations For

General Counsel to Decrease

Liability & Manage EEOC Investigations

Eric Dreiband

[email protected]

AGENDA

• Strategies for Responding to EEOC

• EEOC Successes, Failures & Likely Future Trends in

Systemic Cases m.”).

EEOC Investigations

• Charge Of Discrimination

• Commissioner’s Charges

• Directed Investigations

• Equal Pay Act

• Age Discrimination in Employment Act

3

On-Site Investigations

• Conduct during on-site investigation

Resolutions

•

Relationship with investigator

•

Political solutions

•

Avoid scorched-earth strategies

5

Resolutions

•

Mediation

•

Predetermination settlement

•

Cause finding

•

Conciliation

Conciliation Process

• Letter of Determination

• Conciliation

• Re-arguing the merits

• Conciliation Agreement

• Scope of Litigation

• Make a record

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Retaliation

•

Conduct during investigation

•

EEOC Litigation Priority

•

Communication with investigator

Obtaining Information

From The EEOC

•

Communicate with the investigator

•

Post-Investigation

•

Freedom of Information Act

•

Compliance Manual Section 83

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EEOC Litigation

• Regional Attorney’s Manual –www.eeoc.gov

• EEOC Individual and Class Cases

• Settlement

• Consent decree “practice”

• Confidentiality

• Scope of Release

EEOC’s

Strategic Enforcement Plan

• Fiscal Years 2013-2016 • Priorities:

• Eliminating systemic barriers in recruitment and hiring • Immigrant, migrant, and other vulnerable workers • Emerging issues : ADA Amendments Act; Lesbian,

Gay, Bisexual, and Transgender issues; pregnancy and forced unpaid leave

• Compensation & gender

• Access to the legal system –retaliation & releases

• Harassment

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EEOC’s

Strategic Enforcement Plan

• Prioritization of charges

• Category A charges will be those that raise priority

issues

• Individual disability, harassment and retaliation

charges will only be included in Category A if they present strong vehicles for development of the law.

• Priority issue and systemic cases will be given

precedence for litigation.

• Delegation of litigation authority to the General

Counsel.

Recruitment and Hiring

•

Exclusionary policies and practices

•

Channeling/steering of individuals into specific

jobs

•

Use of screening tools

•

Pre-employment tests

•

Criminal history and credit background

checks

•

Date of birth screens on online applications

EEOC &

Criminal Background Checks

• Focus on disparate impact

• Race & National Origin

• Blanket prohibitions on hiring convicted felons may

generate EEOC interest.

• EEOC has pursued employers that have broad

prohibitions on hiring applicants with conviction records.

EEOC Guidance on Consideration

of Arrest & Conviction Records

• Issued on April 25, 2012

• Cites national conviction statistics

• Flips the burden of proof by placing the burden on

employers

• Affirmative defense -“job related for the position in question and consistent with business necessity.”

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EEOC Guidance on Consideration

of Arrest & Conviction Records

• Two circumstances when an employer will meet the defense: • The employer validates per the Uniform Guidelines on Employee

Selection Procedures

• The employer develops a “targeted screen” considering at least

– The nature of the crime – The time elapsed – The nature of the job

– AND then provides an opportunity for an “individualized

assessment” for people excluded by the screen to determine

whether the policy as applied is job-related and consistent with business necessity.

Criminal Background Checks

• Pepsi Beverages -- $3.13 million settlement with EEOC–alleged that practice of rejecting individuals with arrest records or

convictions for minor offenses had adverse impact against African American applicants.

• EEOC v. Peoplemark, Inc. (W.D. Mich. 2011) –Dismissed and

EEOC sanctioned because employer offered employment to many convicted felons.

• EEOC v. Freeman (D. Md. 2013) –Dismissed because EEOC

did not offer admissible statistical evidence of adverse impact; EEOC alleged discrimination against Hispanics, men and African Americans.

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Credit Checks

• EEOC asserts that using credit history data in hiring decisions

can have an adverse impact against minorities.

• EEOC v. Kaplan Higher Education Corp., Case No. 1:10 CV

2882, 2013 BL 21834 (N.D. Ohio Jan. 28, 2013), appeal

pending.

• Alleged “defendants' use of credit reports in the hiring

process has an unlawful disparate impact on Black applicants.”

• Court granted summary judgment in favor of the defendant.

– “race rating” used by EEOC’sexpert was not reliable – EEOC failed to prove adverse impact

LGBT Coverage

• Macy v. Holder, EEOC Appeal No. 0120120821,

2012 WL 1435995 (E.E.O.C. Apr. 20, 2012)

• Discrimination against a federal employee

because of transgender status is discrimination because of sex and therefore presents a

cognizable claim under Title VII.

• Strategic Enforcement Plan –Lesbian, Gay,

Bisexual, and Transgender protections “as they may apply”

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ADA Amendments Act and

EEOC Regulations

• EEOC regulations

• Emphasize broad scope of protection.

• Available at www.eeoc.gov and 29 C.F.R. Part

1630

• Violation occurs when a covered entity takes a

prohibited action because of an actual or perceived impairment that is not both transitory and minor.

Physical or Mental

Impairment Regulations

• Any physiological disorder or condition, cosmetic

disfigurement, or anatomical loss affecting one or more body systems

• Any mental or psychological disorder • Examples

• Neurological or reproductive disorder • Immune and circulatory systems

• Emotional or mental illness • Learning disabilities

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Major Life Activities

Regulations

• Operation of bodily functions covered: Immune system; Normal cell

growth; Cardiovascular; Respiratory; Brain; Reproductive; Endocrine; Musculoskeletal

• Impairments that are episodic or in remission will qualify if the

impairment would substantially limit a major life activity when active

• Epilepsy • Asthma • Diabetes • Bipolar disorder

• Major depressive disorder

• Mitigating measures may not be considered to disqualify an individual

EEOC Regulations &

Specific Disabilities

• No “per se” list

• Non-exhaustive list of impairments that will “in virtually all cases”

be found to impose a substantial limitation on a major life activity

• Individualized assessment should be “particularly simple and

straightforward”

• Examples that will “virtually always” qualify: Deafness; Blindness;

Intellectual disability (formerly termed mental retardation);

Missing limbs and impairments that require a wheelchair; Cancer; Cerebral Palsy; HIV; Epilepsy; Muscular dystrophy;

Post-traumatic stress disorder; Diabetes; Major depressive disorder; Schizophrenia; Obsessive compulsive disorder; Bipolar disorder

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Leave Policies & the Americans with

Disabilities Act

• EEOC contends that employers must “modify” attendance and

leave policies to provide disabled employees with additional leave unless:

• Another accommodation would allow the employees to

perform the essential functions of their position; or

• Granting additional leave would cause an undue hardship. • EEOC may issue new guidance about the ADA and leave

policies.

• Courts do not always agree with EEOC.

EEOC & Leave

• EEOC v. Sears Roebuck & Co., No. 04 C 7282 (N.D.

Ill Sept. 29, 2009)

• EEOC alleged that Sears violated ADA by

automatically discharging employees after one year of workers’ compensation leave.

• Settled for $6.9 million and other relief

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EEOC & Leave

• EEOC v. United Parcel Service, Inc., Civil Action No.

09-C-5291 (N.D. Ill)

• EEOC alleges that UPS violated ADA by firing

employees who exceeded a 12-month leave policy.

EEOC & Leave

• EEOC v. Verizon, Case 1:11-cv-01832-JKB (D. Md.

2011)

• EEOC alleged that Verizon maintained attendance

plans that failed to accommodate certain individuals with disabilities

• Settled for $20 million and other relief

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EEOC & Pay Equity

• EEOC has enforcement authority for pay claims

under Title VII and Equal Pay Act.

• Several EEOC offices have started audits under the

Equal Pay Act

• EEOC can start investigation without a charge.

EEOC & Pay Equity

• EEOC may require employers to submit pay data to EEOC. • Paycheck Fairness Act

– Would authorize this approach. – Stalled.

• National Academy of Science evaluated “data sources,

methodological requirements, and appropriate statistical techniques for the measurement and collection of employer pay data.”

• August 2012 Report questioned EEOC’sability to handle the data

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EEOC’s Other Priorities

• EEOC’sGuidance on Reasonable Factors Other Than Age

• Protecting Older Workers Against Discrimination Act - Legislation to

Overturn Gross v. FBL Financial Group

• Waivers and Releases

• Overly broad waivers identified as an issue in Strategic Enforcement

Plan

• Family and Caregiving Responsibilities

• January 2011 issued “Employer Best Practices for Workers with

Caregiving Responsibilities.”

• EEOC has given increased attention to discrimination against

caregivers, which EEOC asserts may be largely rooted in stereotypes based on gender and/or race.

Procedural Issues

• How broad a subpoena can the EEOC enforce?

• What is the proper scope of an EEOC lawsuit based

on the Commission’s pre-suit investigation?

• Has the EEOC satisfied its duty to engage in good

faith conciliation before filing a lawsuit?

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EEOC Subpoena Authority

• Title VII confers on the EEOC the power to issue administrative

subpoenas during investigations.

• Respondent who oppose subpoena must file a petition to revoke

or modify the subpoena

• File with the District Director who issued the subpoena • Must be filed within 5 days of receipt of subpoena

• Failure to file petition may foreclose ability to oppose subpoena

enforcement.

• Petition process is not available for Age Discrimination in

Employment Act and Equal Pay Act cases.

EEOC

Subpoena Cases

• EEOC v. Randstad, 685 F.3d 433 (4th Cir. 2012)

• Fourth Circuit Court of Appeals reversed district court order

denying enforcement of EEOC subpoena

• EEOC v. Kronos, Inc., 694 F.3d 351(3d Cir. 2012)

• On case’s 2nd visit to the Third Circuit, Court reversed and remanded for yet further consideration of EEOC subpoena

• Involves third-party administrative subpoena to vendor that

develops assessment tests.

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EEOC Conciliation

• “If the Commission determines after [its] investigation that there is reasonable cause to believe that the charge is true, the Commission shall endeavor to eliminate any such alleged unlawful employment practice by informal methods of conference,

conciliation, and persuasion.” –42 U.S.C. 2000e-5(b)

• Recently, the EEOC has come under fire for failing to

EEOC’s Failure to Investigate

• EEOC v. Dillard’s Inc., 2011 BL 184685 (S.D. Cal. 2011)

• EEOC investigated discrimination in one store.

• EEOC’s conciliation efforts focused on two individuals who worked at that one store.

• EEOC then filed a nationwide class action against the retail

chain.

• The Court dismissed the nationwide suit based on the failure

to provide notice to the company and/or conciliate the broader claims and allowed the EEOC to proceed only on claims as to the one store.

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EEOC’s “Sue First,

Ask Questions Later” Strategy

• EEOC v. CRST Van Expedited, Inc., 679 F.3d 657 (8th Cir.

2012)

• Sexual harassment class action.

• District court dismissed claims on behalf of 67 class

members because the EEOC failed to investigate or attempt to conciliate their claims before EEOC sued.

• 8th Circuit affirmed.

• District court sanctioned EEOC $4.7 million for violating

EEOC’spre-suit investigation and conciliation requirements

More “Sue First, Ask

Questions Later” Cases

• EEOC v. Swissport Fueling, Inc., No.

CV-10-02101-PHX-GMS, 2013 BL 4628 (D. Ariz. Jan. 07, 2013) – Dismissed claims for 21 claimants not identified before EEOC sued

• EEOC v. The Original HoneyBaked Ham Co. of

Georgia, Inc., No. 1:11-cv-02560-MSK-MEH, 2013 BL

10024 (D. Colo. Jan. 15, 2013) –court limited EEOC’s case to one supervisor who allegedly sexually

harassed women.

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Deference to EEOC

• EEOC v. Cintas Corp., 699 F.3d 884 (6th Cir. 2012), petition for cert. pending

• Failure to hire sex discrimination case • District court

• Dismissed EEOC’snationwide claim and limited the case to the

State of Michigan.

• Dismissed EEOC’sclaims for 13 individuals because EEOC did not

investigate or conciliate the claims before EEOC sued.

• Sixth Circuit reversed

• EEOC satisfied its pre-suit obligations.

• It is inappropriate for a district court to inquire into the sufficiency of

EEOC’S ADMINISTRATIVE

PROCEDURE ACT ARGUMENT

• EEOC claims that its pre-suit conciliation process is

not subject to judicial review because the

Administrative Procedure Act commits concliation to EEOC’s “discretion” and makes it unreviewable.

• Several courts have rejected EEOC’sposition and

none have accepted it.

• EEOC v. Mach Mining is pending before the U.S.

Court of Appeals for the Seventh Circuit and may decide this issue.

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Questions