seal.pngBy Gerald L. Maatman, Jr.

Today I had the honor of speaking on workplace class action litigation developments at the American Conference Institute’s 17th Annual EPLI Program in New York City. It was a great conference. Corporate counsel, plaintiffs’ lawyers, and defense counsel from around the country shared insights on a broad spectrum of workplace litigation issues.

The best part of the program reminded me of the old E.F. Hutton TV commercial with the tag line “When E.F. Hutton speaks, people listen…” For those who do not recall it, it’s on YouTube here.

In this instance, Constance Barker, one of the EEOC’s Commissioners, gave the key note address on “EEOC Initiatives for 2012 and Beyond.” Like that old TV commercial, when the EEOC talks, it behooves employers and business professionals to listen. Ms. Barker’s presentation was no exception.

Commissioner Barker has been a member of the EEOC since 2008. She was nominated by President Bush on March 31, 2008, and unanimously confirmed by the Senate to serve the remainder of a five-year term expiring on July 1, 2011. On May 19, 2011, Commissioner Barker was nominated by President Obama to serve a second term to expire on July 1, 2016. The nomination to the second term was unanimously confirmed by the Senate on September 26, 2011.

As a former employment litigator representing primarily small businesses in Alabama, Commissioner Barker is known to be sensitive to the challenges and frustrations of businesses in the current economy. She summed up her personal philosophy in her opening remarks at the ACI Program – that vigorous enforcement of employment discrimination laws is an imperative, but it is unfair and inappropriate for any governmental agency to use the vast powers at its disposal to leverage a settlement from a business through threats and litigation tactics that force a business to settle due to the costs – measured both in litigation expenses as well as a loss of market share – of defending itself.

It reminded me of the chorus of criticisms from some quarters leveled against New York Attorney General Eliot Spitzer in the late 1990’s for alleged abuses of prosecutorial discretion in pursuing civil and criminal litigation against Wall Street companies. While somewhat “apples to oranges” to the current state of workplace litigation, the refrain is not entirely irrelevant. More than one employer has shared stories of how the EEOC “just doesn’t fight fair” in terms of the way it unfairly expands single worker charges into wide-ranging systemic investigations, negotiates via “take-it-or-leave-it” settlement demands while threatening to file a “big case,” or sometimes litigates with a “shoot first and aim later” philosophy that more than one federal judge has deemed inappropriate (and then sanctioned the government for its litigation tactics). That topic has been popular theme from readers of our prior blog postings – especially on EEOC o/b/o Serrano, et al v. Cintas Corp., where Judge Sean Cox from the U.S. District Court for the Eastern District of Michigan awarded an employer $2,638,443 in fees and costs this past year for having to defend the EEOC’s lawsuit.

Ms. Barker cited the EEOC’s latest litigation statistics released yesterday by the Commission. Those statistics underscore the reality employers face – more charges than ever before in the Commission’s history, more systemic investigations, and more – and bigger – EEOC lawsuits. The EEOC’s most recent new release on its statistics further confirms the findings of its FY 2011 report from last Fall.

Ms. Barker suggested that the key to successful compliance strategies for businesses and their legal counsel is to keep a focus on what is “coming down the road” in the future. Here are some of those take-aways from the Commissioner in terms of the EEOC’s future focus –

1. An agency emphasis on hiring or “gateway access” issue to jobs

Despite the lack of any explicit legislative grounding for such claims, EEOC investigators and attorneys have their “radar on” for issues involving employers’ use of criminal background checks and credit checks in the hiring process. The recent settlement with Pepsi for over $3.13 million bears witness to that focus. What’s more, some EEOC personnel see a legitimate basis for examining employer conduct in “refusing to hire the unemployed” or using “high school diploma” hiring requirements. Ms. Barker opined that more often than not, these investigations and lawsuits are based on alleged race and national origin discrimination. At the same time, critics of the EEOC paint this as “legislating through the backdoor” by aggressive stretching of the envelope of workplace bias laws when Congress has never explicitly made such practices unlawful.

2. Numbers matter

Critics of the EEOC sometimes bemoan agency reports of measuring “success” by numbers of lawsuits filed (and settlement numbers and amounts). Commission Barker said that “quotas” do not exist and have no place in law enforcement, but that “target” numbers have seeped into the conversation from time to time. There is no doubt that this often fuels the critics who complain that decision-making on institution of lawsuits is not an ideal process in light of the law’s aims. One only needs to check the right-hand side of the EEOC’s website – in its news release section – to see the daily listing of “who got sued” or “what the latest settlement entailed in terms of the dollars paid.”

3. Conciliation often entails frustration

Ms. Barker also addressed another employer headache in terms of the sometimes distasteful experience of “good faith” conciliation at the end of an investigation – the “take-it-or-leave-it settlement demand for full relief,” and the stance of “if-you-don’t-like-it-and-don’t-agree-to-our-terms,” we are going to bring “a substantial lawsuit against your company that will be even bigger.” She ascribed this problem to the fact that such decision-making is often more local than headquarters-driven, and that perceived abusive tactics are sometimes the by-product of that process. She urged employers to document any such problems, and insist on compliance with the “good faith” duty that is part and parcel of the conciliation concept.

4. The future is disparate impact

The most intriguing comments in her address were Ms. Barker’s prediction that statistical issues with workforce data – patterns in hiring, pay, promotions, and terminations – will become the most important focus of analysis and investigations in the EEOC’s future. Given the EEOC’s focus on systemic investigations, this prediction is already coming home to roost for many employers. In turn, an employer’s efforts to capture, understand, and strategize about its workforce data will become an increasingly more important attribute of compliance efforts. Identification of vulnerabilities and remediation of problem areas often will spell the difference between success or failure in facing EEOC investigations or lawsuits.

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Today was a great learning experience. When the EEOC speaks, it behooves us all to listen and understand how it views the world of workplace bias laws.