I’ve got a new post up at Cato (“Sixth Circuit: You’re Drunk, EEOC, Go Home“) on the Equal Employment Opportunity Commission’s spectacular loss yesterday at the Sixth Circuit in the Kaplan case. As I comment, the victory for the defendant is
all the more impressive because one of the three judges on the opinion is liberal lion Damon Keith, about as sympathetic a judicial ear as the EEOC could normally hope for. It’s a sharp setback for the agency’s dubious “disparate impact” campaign against employer use of credit and criminal records in hiring. And it’s also part of a pattern of rebuffs and defeats the EEOC has been dealt by judges across the country since President Obama turned the agency on a sharp leftward course with his appointments.
The Sixth Circuit has actually been one of the EEOC’s better circuits in recent years. For example, it reversed a Michigan federal judge who in 2011 had awarded $2.6 million in attorneys’ fees to Cintas, the employee-uniform company, and reinstated the lawsuit. In doing so, the appellate panel nullified what had been the lower court’s findings of “egregious and unreasonable conduct” by the agency, including a “reckless sue first, ask questions later strategy.” The commission hailed the reversal as one of its big legal wins — although when one of your big boasts is getting $2.6 million in sanctions against you thrown out, it might be that you don’t have much to brag about.
For some other recent EEOC courtroom setbacks, check our roundup of last month. If you wonder why the commission persists in its extreme aggressiveness anyway, one answer may be that the strategy works: most defendants settle, and the commission hauled in a record $372 million in settlements last year. Yet here and there, as with Kaplan, defendants decide to put up a fight, with instructive results. When will Congress begin to hold the commission accountable? More: Hans Bader, CEI.
To end an employment lawsuit, or more often simply as part of a non-litigious parting, employers often offer a severance package part of which consists of various terms releasing all claims and covenanting not to sue, requiring confidentiality and cooperation in the case of future litigation, and so forth. Now, in a lawsuit against CVS, the Equal Employment Opportunity Commission is taking the position that many such clauses constitute “retaliation” for protected activity and are legally invalid. Jon Hyman of Ohio Employer’s Law Blog notes that the clauses under challenge are generic ones widely used in severance packages and explains why in his view the “case has the potential to be most significant piece of litigation the EEOC has filed in recent memory.” Daniel Schwartz at Connecticut Employment Law Blog also calls the suit “a big deal: “My gut tells me that the courts are not likely to view the government’s arguments with favor. … But for employers, that is of little solace.” More: Ameet Sachdev/Chicago Tribune (“the EEOC brought the suit even though CVS expressly protected employees’ rights under discrimination laws”), Joshua Feinstein, JD Supra (“the potential for havoc is great”), Hope Eastman/Paley Rothman (“a major shock to employers”)
As mentioned yesterday, the federal Equal Employment Opportunity Commission has either had a stretch of really, really bad luck in court lately, or else it’s been caught out by a series of judges for outrageously aggressive litigation sometimes crossing over into misconduct. Among the recent cases, the Sixth Circuit upheld a fee award of $750,000 to a company that the commission had sued over a purported policy of not hiring convicted felons. Here’s Molly DiBianca of the Delaware Employment Law Blog:
The EEOC “investigated” the Charge, issuing multiple subpoenas and obtaining more than 15,000 pages of documents. Although the evidence did not seem to support the allegations in the Charge, EEOC disagreed and filed suit. The suit, asserted on a class of individuals, alleged that the company’s policy prohibited the hiring “of any person with a criminal record,” which disparately impacted Black applicants.
The trouble, though, was that PeopleMark did not have such a policy. Then the EEOC identified approximately 250 individuals it contended to be within the class of aggrieved persons. Well, as it turned out, PeopleMark had hired 57 of the individuals and some others did not have a criminal background in the first place.
More from Eric Paltell/Kollman & Saucier; DeGroff & Maatman; Greg Mersol, Baker Hostetler; EEOC v. PeopleMark.
For the fourth time in two months a judge has chastised the Equal Employment Opportunity Commission for its high-handed ways, reports Claire Zillman at Fortune:
According to court filings, EEOC personnel arrived with subpoenas in hand, intimidated the small office’s staff, rifled through its confidential personnel and patient files, and illegally took company documents. The EEOC acted “as if it were the FBI executing a criminal search warrant,” HNI said in a court filing.
On September 30, a federal magistrate judge in Atlanta ruled that the commission’s tactics constituted a “highly inappropriate search and seizure operation.” The agency’s “failure to follow its own regulations, its foot-dragging, its errors in communication which caused unnecessary expense for HNI” constituted a “misuse of its authority as an administrative agency.”
Last month federal judge Loretta Preska in Manhattan whacked the agency in a discrimination suit against Bloomberg LP, dismissing most charges and ruling that the agency had failed to shoulder its responsibility to investigate before litigation. [Reuters, NY Post, NY Daily News]
Much more on the agency’s waywardness: Hans Bader; DeGroff and Maatman on 10th Circuit TriCore case.
EEOC v. Boh Brothers is a new Fifth Circuit en banc decision allowing liability on a theory of hostile workplace environment sex discrimination arising from crude and aggressive locker-room banter in an all-male workplace (on facts differing somewhat from those in Oncale v. Sundowner, the 1998 Supreme Court case countenancing such liability). The dissent by Judge Edith Jones, p. 46 at footnote 3, cites my “Sentence First, Verdict Afterward,” from the July issue of Commentary magazine, on the federal government’s unhealthy interest lately in developing legal doctrines that pressure private institutions into adopting speech codes aimed at protecting listeners’ sensitivities.
Don’t miss the “Etiquette for Ironworkers” parody legal memo on p. 58, either. How many dissents include a parody legal memo?
“A group of Spanish-speaking custodial workers in Colorado have filed a complaint with the Equal Employment Opportunity Commission alleging that the Auraria Higher Education Center in Denver discriminated against them by failing to provide Spanish translations.” [Caroline May, Daily Caller; Denver Post]