EEOC Remains Active/Highly Aggressive in 2016

Already this year, the EEOC has introduced two very significant measures that are sure to delight plaintiff lawyers while causing serious concerns for employers and their management-side attorneys, including your friends here at Wessels Sherman.  The more troublesome new measure is the EEOC’s proposal to significantly modify the information employers must report each year as part of the agency’s EEO-1 reporting requirements.  Specifically, starting in September of 2017 the proposal is to require employers to include additional information in their annual EEO-1 reports to the government, setting out pay ranges and hours worked for their employees.  It takes little imagination to think of how a federal governmental agency such as the EEOC might use this kind of information if employers are made to disclose it, annually.  Another new proposal involves new guidelines on retaliation prohibited under the various laws administered by the EEOC, such as Title VII, ADA, ADEA and EPA.  These guidelines are designed to educate the public on how the EEOC views retaliation claims, which continue to be the fastest growing type of claim filed with this agency.  No doubt they also will educate more plaintiffs on how to sue.  

According to the EEOC the additional data gathered under its proposed new EEO-1 reporting requirement, would be used to assess discrimination complaints of all types (race, sex, age, disability, religion, national origin, etc.).  If in the course of such investigations it identifies any pay disparities in the employer’s EEO-1 reports, the EEOC would expand its investigation to include scrutiny of the employers wage and hour practices. Under this scenario, while investigating an individual applicant’s or employee’s charge of discrimination the EEOC would look at the employer’s EEO-1 reports for any indication of disparity among all employees regarding pay or hours worked.  The data could be used to launch a full-scale investigation into potential “systemic pay discrimination,” followed by class-action claims in the discretion of the EEOC’s investigator and Regional Director.  Obviously, if the proposal goes through and employers are required to disclose pay and hour ranges in their annual EEO-1 reports, employers can expect more lawsuits along with dissemination of information that is otherwise regarded as proprietary and confidential.  

The EEOC’s proposed revisions to its guidance on retaliation claims are the first since 1998.  This new guidance broadens the definition of the sorts of “adverse employment actions” employees can challenge as the basis for a claim of unlawful retaliation.  For instance, terminating an employee has always been regarded as the consummate unlawful “adverse employment action” if done in retaliation for an employee’s exercise of rights under Title VII, ADA, ADEA, etc.  But what if an employee claims retaliation based on less severe actions, such as denying a requested vacation, or being spoken to more harshly by a supervisor?  Different courts have addressed this question with different results and, as one might expect, the EEOC’s proposed definition is very employee friendly, and even includes non-work related actions, as long as they might deter reasonable individuals from engaging in protected activity.  In addition, the proposed new guidance attempts to usurp the role of courts to determine how evidence is weighed to prove retaliation by connecting an employee’s protected activity (e.g., complaining of discrimination, participating in an investigation, etc.) to a challenged adverse employment action.  This guidance states that an employee can discredit the employer’s explanation for taking the adverse action and show a causal connection between the protected activity and the adverse action through a “convincing mosaic” of evidence that would support a claim of retaliation.

Both of these actions are just proposals at this point, and interested employers and other parties can submit comments before any final action is taken.  Comments will be accepted on the pay data proposal through April 1, and on the retaliation proposal through February 24.  Employers are advised to use 2016 to audit in preparation for the possibility that employers may be essentially open to inspection by the federal government, in 2017.

Questions? Contact Minnesota Attorneys at (952) 746-1700 or email chbeggan@wesselsherman.com to arrange a consultation.

Recent Court Decisions Demonstrate the Value of Knowledgeable Defense Counsel in Employment Cases

Employers rightly are concerned with legal expenses; however, acting as one’s own lawyer in responding to EEOC, MDHR and other agency charges of employment discrimination, retaliation or other workplace claims can be a risky proposition.  Things can sometimes go terribly wrong when these claims are mishandled (e.g. when a single claim blows up into a class-action lawsuit on behalf of multiple “similarly situated” individuals). Of equal importance, however, is when important defenses are not raised, forfeiting opportunities for victory on procedural technicalities and other grounds.  Calendar year 2016 has begun with several poignant examples of clever defense strategies that secured dismissal of employment lawsuits for employers.

In two recent cases, the Eighth Circuit Court of Appeals, which covers Minnesota, Iowa, Nebraska, Arkansas, Missouri and the Dakotas, dismissed employment discrimination lawsuits because the plaintiffs in those cases failed to disclose their pending discrimination claims, when they filed for bankruptcy proceedings.  The court held in each of these cases that allowing the plaintiff to pursue recovery of money damages based on employment discrimination claims they failed to disclose to creditors in bankruptcy, would be inconsistent with their representations to the bankruptcy court.  As a result, the court held that the plaintiff’s must be stopped from proceeding with their employment claims.  This is not an uncommon scenario in employment litigation, so employers named as defendants should always keep in mind the potential for dismissing a complaint on grounds that the plaintiff has filed for bankruptcy without disclosing his or her workplace lawsuit.

In another interesting case, a former employee filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) and cross-filed it with the Minnesota Department of Human Rights (MDHR).  The EEOC took five years to investigate the charge before dismissing it and issuing a right-to-sue!  Shortly after that, the MDHR also dismissed the charge, and the plaintiff filed a civil action, alleging violations of Title VII of the Civil Rights Act of 1964 (Title VII) and the Minnesota Human Rights Act (MHRA).  On the employer’s motion the court dismissed the MHRA claims due to the five-year delay between the filing of the charge and the dismissal.  While recognizing that the result may seem harsh, the court noted that the plaintiff could have requested a dismissal and right-to-sue letter earlier.  Although the plaintiff is still free to pursue his Title VII claims, this partial dismissal is significant because the MHRA provides much more favorable remedies to a successful plaintiff.

In another case, a plaintiff’s claims were dismissed because the plaintiff failed to file his case within 90 days after receiving his right-to-sue from the EEOC.  Under Minnesota state court rules, an action is begun, or “commenced” when a summons and complaint are served on the opposing party.  Thereafter, the rules provide that the case does not have to be filed with the court until a reasonable amount of time after service, not to exceed one year.  In this case, the plaintiff served but did not file his complaint within the 90 day period following the EEOC’s dismissal of the underlying charge.  The defendant moved the court to dismiss the complaint because the EEOC’s right-to-sue letter specifies, based on language in Title VII itself, that a civil action must be filed within 90 days.  The court agreed, noting that federal law trumped Minnesota rules of civil procedure in this regard.

In each of the above cases, plaintiffs’ employment lawsuits were dismissed over what plaintiff lawyers no doubt would complain are “technicalities,” without the court reaching the merits of their claims.  Obviously these recent decisions serve notice to plaintiffs and their counsel of the need to understand the many state and federal procedural nuances of employment law.  Just as important, however, is the need for defense counsel and lawyers who advise employers, to recognize these defenses when they present themselves.

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Questions?  Arrange to speak to an experienced employment attorney from Wessels Sherman by contacting Christine Beggan at (952) 746-1700 or email chbeggan@wesselssherman.com.