EEOC Mediations: Threats or Neutral?

EEOC sealThe founder of EEO Legal Solutions, Merrily Archer, posted a column on December 19, 2013, about its survey of EEO practitioners’ experiences with mediations before the Equal Employment Opportunity Commission (EEOC). See The EEOC’s FY2013 PAR: How STUCK Employers Are, EEO Legal Solutions, December 19, 2013.

EEO Legal Solutions found that about 60% of survey respondents said the EEOC implied that they agency would investigate whether the employer had engaged in systemic discrimination, over 70% said the EEOC implied there was a serious risk of a “for cause” determination, and 80% said the EEOC told them the costs of defense would be high. For a summary of the survey, see EEOC insider reveals ‘bullying’ tactics towards employers, HR America, January 22, 2014.

Ms. Archer argues that the EEOC’s tactics amount to “bullying” or misrepresentation, because in fact the agency issues “for cause” findings in only about 3.8% of complaints, and litigates less than one case in a thousand.

The EEOC’s Performance and Accountability Report for 2013, cites its increased monetary settlements from employers, even though the number of discrimination cases filed with the EEOC had decreased. The question is whether these increased settlements are reached with appropriate tactics or not.

The Fox Rothschild Employment Discrimination blog has posted a debate between Ms. Archer of EEO Legal Solutions and Robert Young of the New York Department of Labor over the appropriateness of the EEOC’s conduct (as each of them interprets it). See Does the EEOC Try To Intimidate Employers?, by Richard Cohen, in the Fox Rothshild Employment Discrimination Report, February 19, 2014.

So, is the EEOC threatening employers in mediations or simply collecting settlements earlier in the process than has occurred in the past? I don’t think we have enough information to answer that question.

1. EEOC Mission Is To Enforce Anti-Discrimination Laws

EEOC posterTo begin with, we need to remember that the EEOC’s mission is to “eradicate employment discrimination at the workplace.” To that end, the agency will “pursue fair and vigorous enforcement where there is any form or level of employment discrimination” prohibited by the laws it implements. Where the EEOC concludes prohibited discrimination has occurred, it should vigorously pursue enforcement and remedies.

However, the EEOC is required to be fair to both employees and employers. So in addressing Ms. Archer’s points, the question is whether the EEOC is being fair to employers.

2. Settlements Are Cheaper Early in the Process

Keep in mind that if a case is going to settle, it is generally cheaper to settle it earlier in the process. If more cases are settled at the EEOC administrative level, rather than later after a lawsuit has been filed, the EEOC settlements are likely to be for less money than a settlement after a court-ordered mediation.

Some of the lower cost may be due to plaintiffs’ willingness to take lower amounts in settlement and move on with their lives (which may or may not be good for plaintiffs), but a lot of the lower cost has to do with the fact that neither side has yet incurred much in the way of legal fees and other litigation costs. Saving those costs is good for both parties—indeed, it is good for everyone except the lawyers.

So just because more cases are being settled at the EEOC level doesn’t mean the EEOC is behaving improperly in seeking those settlements. Quite likely, many of the cases the EEOC is settling would have settled later during litigation, and perhaps for more money then. Who is to say whether the employer would have been better or worse off to settle later in the process?

3. Mediation Tactics Used by EEOC

I didn’t see much in Ms. Archer’s column or reported argument with Mr. Young that indicated the EEOC’s mediation tactics were out of line.

     Arguing Defense Costs: In every mediation where I have been a defense counsel or corporate representative, the mediator pushed hard on my client and me to settle because of the potential for an adverse decision and because of the cost of defense.

I have seen federal magistrates, EEO agency in-house mediators, and independent mediators all use those arguments. I push these points myself when I am mediating employment cases to get defendants to increase their offers. If the EEOC is “bullying” employers with these tactics, then most mediators do the same thing.

The biggest issue with pushing costs of defense as a reason to settle is that the costs of discrimination litigation are borne disproportionately by employers. When the employee wins, the employer pays the plaintiff’s attorneys fees. When the employer wins, the employee rarely is required to pay the employer’s costs. But that is not the EEOC’s fault; that is the fault of judicial interpretations of the statutes.

     Evaluating the Case: Many mediators also give their evaluations of the case—to both parties—to encourage settlement. Some mediators refuse to be “evaluative,” but even those who refuse to put a dollar figure on the case will often point out the strengths and weaknesses of the parties’ cases.

And again, if the EEOC’s tactic in evaluating the case is “bullying,” then I have frequently observed federal judges bully parties into settling. One judge announced during a settlement conference where I was defense counsel what the case should settle for, in the presence of the plaintiff. After that point, of course, she would take nothing less.

Furthermore, the EEO Legal Solutions survey asked only employer representatives what they had experienced. We are only getting half the picture in this survey. It could be that the EEOC is using the similar tactics with individual complainants and their attorneys—telling them of the high cost of pursuing their case, the possibility they will lose or win very little in damages.

* * *

As I see it, the real issue is whether the EEOC can act both as a neutral mediator and also as a prosecutor of employment discrimination issues. Does the agency maintain a Chinese wall between these functions? That, to me, seems to be a legitimate issue.

Perhaps the EEOC should make greater use of outside mediators, rather than having its own employees conduct the mediations when the case is still pending at the agency.

What has your experience been during mediations of employment cases?


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Filed under Human Resources, Law, Mediation, Workplace

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