By Gerald L. Maatman, Jr.

Seyfarth Synopsis: Workplace arbitration programs continued to have a profound impact on workplace class action litigation in 2021. Such programs influenced the nature of class action litigation filed and shifted the types of claims asserted as the plaintiffs’ bar continued to find ways to pivot around such obstacles.

As employers clawed for cover from the increasing weight of workplace class action litigation in recent years, workplace arbitration has continued to gain traction, aided by the U.S. Supreme Court’s transformative ruling in Epic Systems Corp. v. Lewis, 138 S. Ct. 1612 (2018). Epic Systems reaffirmed that the Federal Arbitration Act (FAA) requires courts to enforce agreements to arbitrate according to their terms, including mandatory agreements that provide for individual proceedings and include class action waivers.

Bolstered by such precedents, more than half of non-union, private-sector employers and more than two-thirds of large employers have adopted mandatory arbitration agreements. Such programs have continued to shift class action litigation dynamics in critical ways as they have led to more front-end attacks on proposed class and collective actions and, as the result of such attacks, to the defense bar dismantling more workplace class and collective actions by fracturing those proceedings and diverting them into individual arbitrations.

Workplace arbitration agreements with class action waivers were one of the most potent tools of employers to manage their risk of class action litigation in 2021. In the time period since the Supreme Court decided Epic Systems, businesses facing class action lawsuits have filed more motions to compel arbitration with a higher rate of success than in the years before this landmark decision.

The latest class action litigation statistics show that, over the past five years, motions to compel arbitration have become an increasingly effective defense to class action lawsuits, particularly since Epic Systems.

The following graphic illustrates the number of motions to compel arbitration that were filed from 2016 to 2021:

Over the past year, plaintiffs’ class action lawyers continued to attempt to find ways to end-run such agreements. These efforts took shape on multiple fronts. In 2021, the plaintiffs’ bar continued to shift its efforts toward claims more apt to be immune from such programs or toward populations less likely to have entered into agreements with the defendants. This trend is illustrated by the spike in filings asserting violations of the California Private Attorneys’ General Act (“PAGA”), which claims, according to current California precedent, are not subject to arbitration based on Iskanian v. CLS Transportation Los Angeles, LLC, 59 Cal. 4th 348 (2014). Such filings have quadrupled over the past decade and, in 2021, continued their upward trajectory. The following graphic illustrates this trend.

In a major turn of events for employers, on December 15, 2021, the U.S. Supreme Court granted a petition for certiorari filed in Viking River Cruises, Inc. v. Moriana, No. 20-1573 (Dec. 15, 2021), to review whether courts can exclude claims brought under the PAGA from federal arbitration requirements, paving the way for a potentially transformative ruling. The Supreme Court’s ruling could dictate the future of the PAGA as a workaround to workplace arbitration, especially as states outside California have considered similar legislation.

On a different front, advocates for workers and labor expanded their efforts to shift this landscape by backing new legislation that would amend federal law to ban mandatory arbitration agreements, depending on the bill, for employment, consumer, antitrust, civil rights, or sexual harassment disputes.

Arbitration agreements have come under increasing scrutiny in recent years, especially with regard to claims for sexual harassment and assault arising during employment. A number of states have attempted to limit employers’ ability to require arbitration of such claims, including states such as California, Maryland, New Jersey, New York, Vermont, and Washington, which have passed statutes in recent years limiting employers’ ability to require arbitration. Most of these efforts, however, have conflicted with the FAA. As a result, worker advocates have targeted their efforts toward amending the FAA or passing laws that limit or prohibit arbitration of workplace disputes.

Multiple proposals have made their way to Congress. In 2021, Senators Kirsten Gillibrand (D-NY) and Lindsey Graham (R-SC) co-sponsored the “Ending Forced Arbitration of Sexual Assault & Sexual Harassment Act of 2021” (S. 2342). The bill has 17 other sponsors, including 10 Democrats and 7 Republicans, and a companion bill introduced in the House (H.R. 4445) has 14 Democratic and 5 Republican sponsors. The Act would amend the FAA to prohibit predispute arbitration agreements, including agreements with class or collective action waivers, for claims involving sexual assault or sexual harassment.

The Resolving Sexual Assault and Harassment Disputes Act of 2021 (S. 3143) was introduced by Senator Joni Ernst (R-IA). The bill would amend the FAA to prohibit arbitration of sexual assault claims and allow for arbitration of sexual harassment claims under limited circumstances. Finally, the Build Back Better Act (H.R. 5376) contains, among many other provisions, language that would overrule the Supreme Court’s decision in Epic Systems by banning collective action waivers in arbitration agreements. This bill passed the House but currently faces unanimous Republican opposition in the Senate. Thus, its prospects are uncertain.

In light of current administrative priorities, the future remains anything but clear as to whether arbitration programs will remain viable tools to counter proposed workplace class actions in the face of continued attacks on Epic Systems. These federal developments suggest that some version of an arbitration bill, particularly if tailored to sexual assault and harassment claims, has a good chance of becoming law.

Seyfarth Synopsis: Yesterday’s blog post analyzed the significant impact of COVID-19 on all aspects of life in 2021, including the legal system in general and workplace class action litigation in particular. Today, the Workplace Class Action Report (WCAR) video series continues with Seyfarth partner Jerry Maatman’s explanation of how COVID-19 changed the class action world in 2021, and what lies ahead for 2022.

By Gerald L. Maatman, Jr.

Seyfarth Synopsis: During 2021, COVID-19 class action litigation became more pervasive in reaching across new industries and spawning new challenges on the workplace class action front. The COVID-19 pandemic had a significant impact on all aspects of life in 2021 and a profound impact on the workplace, in particular. In 2020, as state and local governments responded to the COVID-19 threat, many employers moved their employees to tele-work or work-from-home arrangements, or laid off or furloughed workers, and many businesses and courts shut down or postponed critical operations. In 2021, as state and local governments continued to manage the COVID-19 threat, vaccines became widely available, and many employers attempted to move their employees to “return to work” or “hybrid” work arrangements.

Such developments prompted federal regulators to enact vaccine-or-test mandates and fueled employers to adopt or expand health screenings, temperature check protocols, and mandatory vaccination policies. These steps, in turn, led to waves of controversy as workplace class actions brought by states, employee advocates, unions, and employer groups erupted over regulatory actions and employer policies.

Challenges to federal actions, to date, have produced mixed results. On September 9, 2021, President Biden signed Executive Order 14042. Through its terms, the EO required entities that contract with the federal government to agree to require vaccinations for their employees. The EO proclaimed that it “promoted economy and efficiency in Federal procurement by ensuring that the parties that contract with the Federal Government provide adequate COVID-19 safeguards to their workers performing on or in connection with a Federal Government contract or contract-like instrument.“ On November 30, 2021, in State of Louisiana v. Becerra, No. 3:21-CV-03970 (W.D. La. Nov. 30, 2021), however, the district court entered a preliminary injunction enjoining enforcement of the rule.

On a similar front, on November 4, 2021, the U.S. Occupational Safety and Health Administration (OSHA) announced its long-awaited Emergency Temporary Standard (ETS) that required employers with 100 or more employees, among other things, to develop, implement, and enforce policies requiring most employees to get vaccinated or to undergo weekly testing for COVID-19. The ETS became effective upon publication in the Federal Register on November 5, 2021, and set January 4, 2022, as the deadline for employees to receive their final vaccine dose or to begin testing. The ETS covered all employees of covered employers, whether full-time, part-time or temporary, except for employees (a) working alone (in a location where other individuals are not present); (b) working from home; or (c) working exclusively outdoors.

Litigants filed at least 27 lawsuits in 12 different federal circuit courts of appeals challenging such agency rule-making on the grounds that, among other things, it exceeded executive authority to regulate employment conditions. On November 12, 2021, in BST Holdings, LLC v. OSHA, No. 21-60845 (5th Cir. Nov. 12, 2021), the Fifth Circuit stayed the ETS and ordered OSHA to refrain from taking steps to implement or enforce the mandate until further court order, reasoning that the petitioners’ challenges to the mandate were likely to succeed on the merits because, even if the mandate passed constitutional muster, it was the “rare government pronouncement” that was both under-inclusive and over-inclusive. Despite such pronouncement, on December 17, 2021, a Sixth Circuit panel designated to rule on the consolidated challenges lifted the stay, reasoning that the harm caused by keeping the emergency temporary standard frozen outweighed any damage that would stem from letting it go into effect.

The Sixth Circuit’s ruling was quickly appealed on an emergency basis to the U.S. Supreme Court. On December 22, 2021, the U.S. Supreme Court agreed to hear arguments on an expedited basis at a special session on January 7, 2022, and to consider whether it should allow the ETS and another rule, issued by the Centers for Medicare & Medicaid Services requiring vaccinations for employees at facilities that participate in the Medicare and Medicaid healthcare programs, to go into effect. Both cases challenge the authority of administrative agencies and the federal government to issue such sweeping mandates in the context of the pandemic. A ruling is anticipated in the first quarter of 2022.

Challenges to state government actions have proven less successful. For instance, healthcare workers sued to block COVID-19 vaccine mandates in both Maine and New York and sought preliminary injunctions contending that such mandates violated their constitutional rights because they did not include religious exemptions. In both cases, the reviewing courts, respectively, refused to grant injunctive relief, and the U.S. Supreme Court declined requests to intervene in both actions. In total, of the 41 motions for preliminary injunctive relief filed in 2021 to prevent enforcement of vaccination rules, only 15, or 41% were granted.

This trend is illustrated by the following graphic.

Challenges to policies adopted by private employers faced worse odds in 2021. In 2021, litigants challenged employer policies on various grounds, including on the grounds that they supposedly discriminated against employees because they failed to provide disability or religious accommodations or retaliated against workers who expressed COVID-related concerns or sought such accommodations.

In Sambrano v. United Airlines, Inc., No. 21-CV-1074 (N.D. Tex. Nov. 8, 2021), for instance, a group of employees filed a putative class action alleging that United violated Title VII by refusing to engage in an interactive process, by failing to provide reasonable religious accommodations, and by retaliating against them for engaging in protected activity. After granting in part defendant’s motion to dismiss in part on personal jurisdiction grounds, the court denied plaintiffs’ motion for preliminary injunction on the basis that plaintiffs failed to meet their burden to show that, without such an order, they would suffer imminent, irreparable harm.

On December 13, 2021, the Fifth Circuit denied an emergency motion for an injunction pending appeal of the order in Sambrano v. United Airline, Inc., No. 21-11159 (5th Cir. Dec. 13, 2021).

By contrast, in Fraternal Order Of Police Chicago Lodge No. 7 v. City of Chicago, No. 2021 CH 5376 (Ill. Cir. Ct. Nov. 1, 2021), a group of police officers filed an action seeking a temporary restraining order to enjoin the implementation of defendant’s COVID-19 vaccination policy until the parties could arbitrate their grievances pursuant to their collective bargaining agreements. The court granted the motion in part. The court reasoned that, if all employees complied with the vaccine requirements, as of the end of the year, there would be no grievances to adjudicate and no remedy that an arbitrator could award. The court, therefore, ruled that plaintiffs demonstrated irreparable injury, stayed compliance with the vaccination requirement until the parties completed their arbitrations, and granted in part plaintiffs’ motion for a preliminary injunction.

In total, courts have issued 65 opinions on motions to dismiss class action claims related to COVID-19 in 2021, and have granted 82% of those motions in whole or in part. The following graphic shows this trend:

In sum, the pandemic has continued to spike class actions (of all varieties) and litigation over all types of workplace issues. To date, however, defendants have achieved high rates of success in defeating these claims by overcoming motions for preliminary injunction and by prevailing on motions to dismiss in whole or part. Employers are apt to see these workplace class actions continue to expand and morph in 2022 as the pandemic endures.

Seyfarth Synopsis: In our continuing video blog series outlining the findings in our Annual Workplace Class Action Litigation Report, trend #3 detailed how government enforcement litigation shifted in 2021, with changes representing a significant shift in philosophy and practice. Listen below as Jerry Maatman explains what occurred in the government enforcement world last year and what is apt to happen in 2022.

By Gerald L. Maatman, Jr.

Seyfarth Synopsis: With the installation of a new administration in 2021, employers saw almost immediate shifts in administrative priorities. Over the past year, the Biden Administration rolled out changes on several fronts that took shape through executive orders, legislative efforts, and agency actions. Contrary to the pro-business approach of the Trump Administration, the Biden Administration aimed for many of these changes to expand the rights, remedies, and procedural avenues available to workers. As a result, many of these changes are likely to have a cascading impact on the workplace class action landscape in several areas, as they encourage entry into the area and render potential recoveries more lucrative.

The Biden DOL, in particular, withdrew or rescinded multiple Trump-era rules often implicated in workplace class actions, including the tip credit, joint employer, and independent contractor rules promulgated by the Trump DOL. In passing the rules, the Trump DOL sought to clarify and narrow legal standards in these areas and, as a result, to bring predictability to companies struggling to comply with arguably imprecise rules open to inconsistent interpretation and application by courts. In undoing these rules, the Biden Administration has rescinded them and, in some instances, has taken steps to replace them with broader, more demanding standards that are more likely to inspire class-wide challenges.

As to the tip credit, for instance, Section 3(m) of the FLSA permits an employer to take a tip credit toward its minimum wage obligation for tipped employees. The so-called “80/20 Rule,” however, which first appeared in a DOL Field Operations Handbook in 1988, purported to require employers to pay the full minimum wage for any time spent performing non-tip-producing tasks that exceeded 20% of the workweek. Courts applied this guidance, forcing employers to separate tasks into buckets of “tip-producing” duties, “related” duties, and “unrelated” duties, with little direction as which activities fell into which bucket. This uncertainty led to waves of litigation that plagued the restaurant industry, in particular, over the past decade.

In November 2018, the Trump DOL issued an opinion letter wherein it withdrew the 80/20 Rule and, in February 2019, it amended the DOL Field Operations Handbook to replace the 20% limitation with a “reasonable time” standard, noting that “an employer of an employee who has significant non-tip related duties which are inextricably intertwined with their tipped duties should not be forced to account for the time that employee spends doing those intertwined duties.” In December 2020, the Trump DOL issued the Tip Regulations Final Rule.

In early 2021, however, the Biden DOL twice delayed the effective date of the Final Rule. Then, on October 23, 2021, the Biden DOL withdrew the Trump-era rule and introduced its own rule. In addition to resurrecting the 80/20 Rule, the Biden DOL limited the tip credit to non-tip-producing work that directly supports tip-producing work and does not exceed “a continuous period” of 30 minutes. The new DOL tipped-employee rule, which went into effect on December 31, 2021, is apt to refuel workplace litigation in this area, particularly as the hospitality industry struggles with challenges posed by tracking activities and task times.

The Trump-era joint employer and independent contractor rules met a similar fate. Effective March 16, 2020, the Trump DOL issued a new rule for determining when two or more distinct employers could be deemed to jointly employ a worker. The rule set forth a four-factor balancing test that considered whether the business: (1) hires or fires the employee; (2) supervises and controls the employee’s work schedule or conditions of employment to a substantial degree; (3) determines the employee’s rate and method of payment; and (4) maintains the employee’s employment records. 29 C.F.R. § 791.2(a)(1). The rule provided employers more clarity and arguably narrowed the circumstances under which they could be deemed joint employers for wage & hour purposes. Following the effective date, the U.S. District Court for the Southern District of New York, however, opined that portions of the rule violated the Administrative Procedure Act (“APA”). The appeal from that opinion remained pending when, on July 29, 2021, the Biden DOL announced that it would rescind the Trump DOL rule effective September 28, 2021, leaving courts to revert to their pre-Trump-Rule frameworks, which implement a variety of multi-factor tests in interpreting joint employer status.

Effective January 6, 2021, the Trump DOL adopted an Independent Contractor Rule that addressed the circumstances under which a worker qualified as an independent contractor. The Rule consisted of two main factors – the level of control the individual has over his or her own work and the opportunity for profit or loss due to his or her own personal investment – and provided that, if the analysis of the two main factors proved indeterminate regarding independent contractor status, companies should weigh three guiding factors, including the level of skill of the role involved, the permanence of the working relationship, and how the role in question relates to the company’s overall business operation. Overall, the Independent Contractor Rule arguably ran counter to the trend discouraging the use of independent contractors and made it easier for companies, including gig economy businesses, to utilize such arrangements. After staying enforcement of the Rule, on May 5, 2021, the Biden DOL withdrew the Independent Contractor Rule, again leaving courts to revert to their varying pre-Trump-Rule frameworks for deciding independent contractor status.

The changing tide brought by the Biden Administration reached outside the wage & hour space and into other areas likely to impact workplace class action litigation. While the DOL acted swiftly to reverse course on many fronts with the change of administrations, the EEOC continued to operate over parts of the past year with a Trump-appointed majority and, as a result, had limited latitude to pivot. President Biden quickly named two Democrats for the five-member Commission, Charlotte E. Burrows and Jocelyn Samuels, as Chair and Vice Chair, respectively. Although the Chair positions shifted with President Biden’s inauguration, however, the Commission retained a Republican-appointed majority. As a result, the major policy changes that many expected to materialize with the Biden Administration may have to wait through July 1, 2022, when former chair Janel Dhillon’s term expires, opening the door to a Democratic-appointed majority.

Major policy shifts on the employment discrimination front manifested in large part through other avenues. Upon taking office, President Biden issued Executive Order 13988, “Executive Order on Preventing and Combating Discrimination on the Basis of Gender Identity or Sexual Orientation,” the fourth Executive Order he signed on January 20, 2021. The order directed all federal agencies to review all policies that implement non-discrimination protections on the basis of sex ordered by Title VII and similar laws and to extend those protections to the categories of sexual orientation and gender identity. President Biden likewise promptly entered Executive Order 13985, “Executive Order on Advancing Racial Equity and Support for Underserved Communities Through the Federal Government” – that revoked President Trump’s Executive Order 13950, “Combating Race and Sex Stereotyping” that directed the head of each agency to ensure that agency employees did not teach, advocate, or promote in training a series of “divisive concepts” such as that one race or sex is inherently superior to another or that the United States is fundamentally racist or sexist – and replaced the directive with one requiring each agency to assess whether, and to what extent, its programs and policies perpetuate systemic barriers to opportunities and benefits for people of color and other underserved groups.

Despite these shifting policy pronouncements from the White House, the EEOC stayed largely on track as compared to the preceding year. During 2020 employers saw significant shifts in the EEOC’s enforcement agenda, including a notable shift away from litigation as a one-size-fits-all tool for combatting workplace discrimination. As the EEOC’s enforcement agenda shifted, employers experienced a marked decrease in federal complaints and a marked increase in settlements as the EEOC sought to wind down its litigation docket.

The EEOC filed a similar number of lawsuits in FY 2021 as compared to FY 2020. The EEOC filed 114 total cases in FY 2021, which included 111 merits lawsuits and 3 subpoena enforcement actions. This total number of filings landed only slightly higher than the FY 2020 total of 101 lawsuits. These totals remain substantially lower than the preceding years, where employers saw 149 filings in FY 2019, 217 filings in FY 2018, 202 filings in FY 2017, and 136 filings in FY 2016. The agency’s systemic filings over the past year followed a similar trajectory. For instance, after more than doubling its inventory of systemic filings between FY 2016 and FY 2018 (with 18 in FY 2016, 30 in FY 2017, and 37 in FY 2018), the EEOC’s systemic filings dropped to 17 in FY 2019, 13 in FY 2020, and 13 in FY 2021.

The following graphic reflects this trend.

In terms of the types of cases filed, when considered on a percentage basis, the types of cases filed in 2021 did not reflect any dramatic shift in strategic priorities. When considered on a percentage basis, the distribution of cases filed by statute remained roughly consistent compared to FY 2020 and FY 2019. Title VII cases once again made up the majority of cases filed, making up 62% of all filings (on par with the 60% in FY 2020 and 60% in FY 2019). ADA cases made up a significant percentage of the EEOC’s filings, totaling 36% in FY 2021, a moderate uptick from 30% in FY 2020. The EEOC filed only one age discrimination case in FY 2021, down seven from FY 2020.

On November 16, 2021, the EEOC released its Agency Financial Report (“AFR”) for Fiscal Year 2021. The AFR is a data compilation regarding the EEOC’s financial health, initiatives, and guiding principles. The FY 2021 edition marked the third version of the publication, following the release of the inaugural AFR in FY 2019. As outlined in the AFR, while lawsuit filings increased slightly in 2021, especially toward the end of the fiscal year in September, the EEOC’s overall monetary recoveries dropped by $51 million, from a record-setting $534.4 million in FY 2020 to approximately $484 million in FY 2021. The FY 2021 number more closely resembled the $486 million recovered in FY 2019, as compared to $505 million in FY 2018 and $484 million in FY 2017.

The amount that the EEOC recovered through mediations, conciliations, and settlements increased from $333.2 million in FY 2020 to approximately $350.7 million in FY 2021, nearly reaching the $354 million recovered in FY 2019. The EEOC announced that it recovered the $350.7 million in FY 2021 on behalf of 11,067 alleged victims of employment discrimination in the private sector and state and local governments. The EEOC also announced that it recovered more than $100 million on behalf of 2,169 federal employees and applicants. On the litigation front, the EEOC reported recovering $34 million for 1,920 individuals as a direct result of litigation resolutions, a sharp decline from the $106 million total in FY 2020 and $39.1 million in FY 2019.

With the pandemic lingering into FY 2021, the EEOC reported a commitment to Alternative Dispute Resolution (“ADR”) programs, including virtual mediation and conciliation proceedings. According to the AFR, in FY 2021, the EEOC successfully resolved 41.1% of its conciliations (51.7% of those included claims that implicated one or more of the EEOC’s Strategic Enforcement Plan priority areas). The EEOC conducted 6,644 private sector mediations, resulting in $176.6 million in benefits to charging parties. This represents a material increase from the $156.6 million recovered in mediations during FY 2020.

Despite the reported commitment to effective conciliation proceedings, and the increase in recoveries from mediations, conciliations, and settlements in FY 2021, on June 30, 2021, President Biden signed a joint resolution narrowly passed by Congress to repeal a Trump-era rule that increased the EEOC’s information sharing during the conciliation process. On October 9, 2020, the Commission published a Notice of Proposed Rulemaking outlining proposed revisions designed to update its conciliation procedures, which it had not changed significantly since 1977. In its announcement, the EEOC acknowledged that, historically, it elected not to adopt detailed regulations relative to its conciliation efforts based on its belief that retaining flexibility over the conciliation process would “more effectively accomplish its goal of preventing and remediating employment discrimination.”6 Although the Commission stressed the importance of maintaining a flexible approach to conciliation, it acknowledged that, over the preceding several years, its conciliation efforts resolved less than half of the charges where it had made a reasonable cause finding. Specifically, between fiscal years 2016 and 2019, only 41.23% of the EEOC’s conciliations with employers were successful.7 (As noted above, in FY 2021, the EEOC successfully resolved 41.1% of its conciliations.)

On January 14, 2021, the EEOC published a final rule that, among other things, would have required the EEOC to provide an employer with a written summary of the known facts that formed the basis of the allegations, to identify known aggrieved individuals or known groups of aggrieved individuals for whom it sought relief unless such individuals requested anonymity, and to supply the calculations underlying any initial conciliation proposal for monetary relief. The White House criticized the procedures as “onerous and rigid,” and, on July 1, 2021, President Biden signed a joint resolution passed by Congress to repeal the EEOC’s final rule that would have overhauled the agency’s prelitigation settlement process.

In sum, whereas employers saw an array of business-friendly rules promulgated by the Trump Administration, the Biden Administration brought changes to these rules that are likely to continue through 2022. Employers can expect continuing shifts and realignments of rulemaking and enforcement priorities that are likely to fuel and shape the contours of workplace class action litigation in the coming year.

In our continuing video blog series analyzing the findings in our Workplace Class Action Report, trend #2 focuses on the success factor of the plaintiffs’ bar for class certification rulings in 2021. In the video, Jerry Maatman discusses how wage & hour litigation remained the sweet spot for the plaintiffs’ class action bar in 2021 and what this means for employers in 2022. Watch below!

Seyfarth Synopsis: In our continuing coverage of the top trends found in Seyfarth’s 2022 Workplace Class Action Litigation Report, wage & hour litigation remained the sweet spot for the plaintiffs’ class action bar over the past year. Based on sheer volume and statistical numbers, workers certified more class and collective actions in the wage & hour space in 2021 as compared to any other area of workplace. Complex workplace litigation remains one of the chief exposures driving corporate legal budgetary expenditures. Class actions and multi-plaintiff lawsuits, in particular, continue to provide a source of concern for companies. A prime component in that array of risks indisputably continues to include complex wage & hour litigation.

The following map sets forth a circuit-by-circuit analysis of this year’s 332 class certification decisions in all varieties of workplace class action litigation, including wage & hour, employment discrimination, and ERISA.

As the map reflects, in 2021, complex wage & hour litigation under the FLSA drove more certification briefings and a greater number of certification decisions than other areas combined.

Wage & Hour Certification Trends

The ease with which plaintiffs have achieved first-stage certification in the FLSA wage & hour context surely has contributed to the number of filings in that area, and plaintiffs achieved a higher rate of success on initial certification motions in 2021 than in any other year of the past decade, indicating that wage & hour remains a sweet spot for the plaintiffs’ bar.

In 2021, wage & hour lawsuit filings in federal courts decreased for the sixth year in a row. That said, more FLSA lawsuits were filed during each of the preceding nine years – during 2012, 2013, 2014, 2015, 2016, 2017, 2018, 2019, and 2020 – than were filed in any year of the preceding several decades. Many of these cases remain in the pipeline within federal courts, and the result is a burgeoning case load of wage & hour issues.

To be sure, the significant volume of FLSA filings over the past several years has caused the issuance of more certification rulings in the FLSA area than in any other substantive area of complex employment litigation. Despite the pandemic’s continued impact on court operations and personnel, courts issued more rulings on wage & hour certification issues in 2021 than they issued in each of the past five years. In particular, federal courts issued 298 decisions on FLSA certification and decertification issues in 2021, an increase from the 286 certification rulings issued in 2020, the 267 certification rulings issued in 2019, the 273 certification rulings in 2018, and the 257 certification rulings in 2017.

Of these rulings, 279 addressed first-stage motions for conditional certification of wage & hour collective actions under 29 U.S.C. § 216(b), whereas 19 addressed second-stage motions for decertification. Plaintiffs historically have secured a higher rate of success on the former, while employers have secured a higher rate of success on the latter. In 2021, as noted above, plaintiffs achieved an exceptionally high rate of success on first stage conditional certification motions, equal to or higher than the rate they achieved in any year of the past decade aside from 2020. In 2021, Plaintiffs saw their rate of success at 81%, down slightly from their 2020 success rate of 84%, and the same as their 2019 success rate of 81%. Employers, on the other hand, saw their rate of success on decertification motions rise to 53% in 2021, up from 50% in 2020 and 58% in 2019.

The analysis of these rulings – discussed in Chapter V of this Report – shows that plaintiffs filed a high predominance of cases against employers in “plaintiff-friendly” jurisdictions such as the judicial districts within the Second and Ninth Circuits. For the second time in a decade, however, rulings were equally or more voluminous out of the Sixth Circuit, which also tended to favor workers over employers in conditional certification rulings.

The following map illustrates this trend:

The statistical underpinnings of this circuit-by-circuit analysis of FLSA certification rulings is telling in several respects.

First, it substantiates that the district courts within the Second, Sixth, and Ninth Circuits are the epi-centers of wage & hour class actions and collective actions. More cases were prosecuted and conditionally certified – 47 certification orders in the Second Circuit, 31 certification orders in the Ninth Circuit, and 50 certification orders in the Sixth Circuit – in the district courts in those circuits than in any other areas of the country. For the second time in two years, the Sixth Circuit – which encompass the states of Michigan, Ohio, Kentucky, and Tennessee – had more rulings and certifications than either the Second or Ninth Circuits.

Second, as the burdens of proof under 29 U.S.C. § 216(b) suggest, plaintiffs won the overwhelming majority of “first stage” conditional certification motions (226 of 279 rulings or approximately 81%) in 2021, which was similar to the 2020 numbers (231 of 274 rulings or approximately 84%), the 2019 numbers (198 of 243 or approximately 81%), and the 2018 numbers (196 of 248 rulings or approximately 79%), which were themselves the highest percentages of plaintiff-side wins recorded in the last decade. Further, in terms of “second stage” decertification motions, employers won 53% (10 of 19 rulings) in 2021, which represented a slight rise from the 2020 numbers (6 of 12 rulings or approximately 50%) and the 2019 numbers (14 of 24 rulings or approximately 58%).

Overall, these statistics show robust numbers for the plaintiffs’ bar, as plaintiffs prevailed on “first stage” conditional certification motions at a high rate in 2021 and lost “second stage” decertification motions at a lower rate. The “first stage” conditional certification statistics for plaintiffs at 81% were nearly as favorable as the rate of success that workers obtained in 2020 (84%), as favorable as the rate of success that workers obtained in 2019, when plaintiffs won 81% of “first stage” conditional certification motions, and more favorable as the rate of success that workers obtained in 2018, when plaintiffs won 79% of “first stage” conditional certification motions.

The “second stage” decertification statistics for employers at 53% in 2021 was more favorable to employers than the decertification statistics in 2020, when employers prevailed on 50% of such motions, in 2019, when employers prevailed on 58% of “second stage” decertification motions, in 2018, when employers won 52% of decertification rulings, and in 2017, when employers won 63% of decertification rulings.

The following chart illustrates this trend for 2021:

Third, these numbers reflect the ongoing migration of skilled plaintiffs’ class action lawyers into the wage & hour litigation space. Experienced and able plaintiffs’ class action counsel are apt to secure better results, and the case law that has developed under 29 U.S.C. § 216(b) serves to attract such individuals. In light of the “lenient” standard that many courts apply at the initial conditional certification phase of a case, plaintiffs often can secure “first stage” conditional certification – and foist settlement pressure on an employer – fairly quickly (shortly after filing a case), with minimal monetary investment (e.g., without support from an expert), as compared to class certification in an employment discrimination class action or an ERISA class action, for instance, which typically requires additional discovery, evidentiary submissions, and expert testimony.

As a result, to the extent that litigation of collective actions and class actions by plaintiffs’ lawyers is viewed as an investment of time and money, prosecution of wage & hour lawsuits is a relatively low cost investment, without significant barriers to entry, and with the prospect of immediate returns as compared to other types of workplace class action litigation. Hence, as compared to employment discrimination and ERISA class actions, FLSA litigation is less difficult or protracted for the plaintiffs’ bar, and more cost-effective and predictable. In terms of their “rate of return,” the plaintiffs’ bar can convert their case filings more readily into certification orders and create the conditions for opportunistic settlements over the short term.

The certification statistics for 2021 confirm these factors. Despite the continued impact of the COVID-19 pandemic and the lower rate of case filings, courts issued more certification rulings in 2021 and the plaintiffs’ bar secured more certification victories in 2021 than in any other year of the past decade.

The extent to which Epic Systems will continue to impact wage & hour certification trends remains uncertain. As 2021 reflected, the number of FLSA lawsuits filed in 2021 continued to fall as compared to prior years. Coupled with the settlements and the number of rulings discussed above, these statistics suggest that the plaintiffs’ class action bar is not losing interest in these suits. To the contrary, the number of rulings issued by federal courts, despite the COVID-19 pandemic, suggests that plaintiffs’ counsel are succeeding in obtaining rulings on motions for conditional certification at a higher rate than ever. These factors also indicate that arbitration agreements are not getting in the way of these motions and that, instead, plaintiffs are being more selective in filing their cases or in narrowing the groups of employees that they seek to represent.

As discussed below, given the pro-worker policies of the Biden Administration, employers are seeing legislative efforts to overturn Epic Systems gain traction. Particularly if Democrats are able to retain control of the House and Senate during the remainder of President Biden’s term, employers may see these legislative efforts to overturn Epic Systems succeed. As a result, employers could see substantial expansion of case filing numbers in the next few years.

Employment Discrimination & ERISA Certification Trends

Against the backdrop of wage & hour litigation, the rulings in Wal-Mart and Epic Systems continued to fuel more critical thinking and crafting of case theories in employment discrimination and ERISA class action filings in 2021. The Supreme Court’s Rule 23 decisions forced the plaintiffs’ bar to “re-boot” the architecture of their class action theories.[1] Hence, the playbook on Rule 23 strategies is undergoing a continuous process of evolution, and the plaintiffs’ class action bar is continually testing ways to navigate around and to wear away the force of these precedents.

As to Wal-Mart, one work-around has been the filing of “smaller” employment discrimination class actions. In the past 10 years, employers have seen more statewide or regional-type classes asserted than the type of nationwide mega-case that Wal-Mart discouraged. Plaintiffs’ counsel have been more selective, strategic, and savvy relative to calibrating the focus of their cases and aligning the size of their proposed classes to the limits of Rule 23 certification theories.

As to Epic Systems, at least in the employment discrimination area, Plaintiffs have seemed apt to file scaled-down class actions to test the prevalence of arbitration agreements among putative class members and, depending on the result, to move forward with one or more limited classes of non-signers or to use the threat of undermining the enforceability of the arbitration program to attempt to leverage a settlement prior to obtaining a ruling on the propriety or scope of certification.

In 2021, the number of rulings on motions for class certification expanded as compared to 2020. In 2021, courts issued 18 rulings on motions for class certification in employment discrimination actions, compared with 12 rulings in 2020 and 15 rulings in 2019. Plaintiffs, however, prevailed on these motions at a higher rate. Plaintiffs prevailed in 13 of the 18 rulings, or 72%, in 2021, with four of those rulings emanating from the Ninth Circuit, compared to 5 of the 12 rulings, or 42%, in 2020, again with four of those rulings emanating from the Ninth Circuit.

The rate of success of the plaintiffs’ bar in 2021 on such motions was materially higher than its rate of success in recent years. In 2019, plaintiffs won 7 of the 11 rulings, or 63%, on motions for initial certification of class actions in employment discrimination cases, but plaintiffs lost 4 of 4 motions for decertification, for an overall success rate of 46.7%. By comparison, in 2018, plaintiffs won 3 of the 11 rulings on motions for class certification, or 27%, and, in 2017, plaintiffs won 7 of 11 rulings on such motions, or 64%.

The following map demonstrates the array of certification rulings in Title VII and ADEA discrimination cases:

In terms of the ERISA class action litigation in 2021, the decisions show that employers had the best chance of defeating class certification in the context of ERISA class actions. Courts issued 16 rulings on class certification in 2021, with plaintiffs prevailing in 8 of 14 decisions, or 57%. As a result, 2021 marks plaintiffs’ lowest rate of success in terms on certifying ERISA class action in recent years by a fair margin. In 2020, plaintiffs won 11 of 16 certification rulings, a success rate of 69%. In 2019, plaintiffs won 11 of 17 certification rulings, a success rate of 65%. By comparison, in 2018 plaintiffs won 11 of 17 certification rulings for a similar success rate of 65%, and, in 2017, plaintiffs prevailed in 17 of 22 certification rulings, for a success rate of 77%.

A map illustrating these trends is shown below:

Overall Trends

So what conclusions overall can be drawn on class certification trends in 2021?

In the areas of wage & hour and employment discrimination claims, in particular, the plaintiffs’ bar is converting their case filings into certification of classes at a high rate. To the extent class certification aids the plaintiffs’ bar in monetizing their lawsuit filings and converting them into class action settlements, the conversion rate is robust.

While class certification rates in ERISA class actions took a nose dive in 2021 compared to prior years (8 motions granted and 6 motions denied in 2021, for a success rate of 57%), class certification for employment discrimination cases (13 motions granted and 5 motions denied in 2021) and conditional certification in wage & hour cases (226 motions granted and 53 motions denied in 2021) remained pronounced, with a success rate ranging from 71% to 81%.

The following bar graph details the win/loss percentages in each of these substantive areas:

–          a success rate of 57% for certification of ERISA class actions;

–          a success rate of 72% for certification of employment discrimination class actions (both Title VII and age discrimination cases); and

–          a success rate of 81% for conditional certification of wage & hour collective and class actions.

The most certification activity in workplace class action litigation took place in the wage & hour space. The trend over the past five years in the wage & hour space reflects a steady success rate that ranged from a low of 73% to a high of 84% for the plaintiffs’ bar. The positive results are more concentrated in plaintiff-friendly “magnet” jurisdictions where the case law favors workers and presents challenges to employers seeking to block certification.

The trend over the past five years for certification orders is illustrated in the following chart:

While each case is different, and no two class actions or collective actions are identical, these statistics paint the all-too familiar picture that employers have experienced over the past several years. Although case law precedents and defense approaches continue to evolve and generate many good outcomes for employers, courts continue to grant conditional certification motions at high rates.

Whereas overall case filing numbers were down, the numbers of rulings issued in 2021 and the rate of success of the plaintiffs’ bar in gaining conditional certification suggest that the plaintiffs’ bar is exercising more selectivity and restraint when it comes to filing and seeking certification of narrower or more defined groups, thereby contributing to a higher success rate.

The key bright spots in 2021 for employers were an increase in the odds of defeating certification in ERISA class actions, where employers succeeded in defeating class certification in nearly 43% of the rulings issued during 2021, and in the odds of prevailing on decertification of FLSA collective actions, where employers succeeded in obtaining decertification in 53% of the rulings issued during 2021.

By Gerald L. Maatman, Jr., Christopher DeGroff, Matthew J. Gagnon, and Sarah K. Bauman

Seyfarth Synopsis: As 2022 begins, we are pleased to present our annual selections for the five most intriguing developments in EEOC litigation during 2021, as well as our annual report on developments and trends in EEOC-initiated litigation. This year’s book, entitled EEOC-Initiated Litigation: 2022 Edition, examines the EEOC’s filings in 2021, and analyzes the significant legal decisions and trends impacting EEOC litigation in 2022. We hope that employers will benefit from this deep dive into how the EEOC’s priorities reveal themselves through litigation.

The EEOC pursues dozens of cases across the country annually, guided by its strategic enforcement priorities and objectives. Each year, we analyze those new case filings, and legal decisions handed down by courts across the country, and we publish that analysis in a comprehensive yearly report entitled EEOC-Initiated Litigation: 2022 Edition. In the report, we outline noteworthy trends and try to identify how the Commission intends to pursue its objectives in the year to come.

Our goal is to assist clients to comply with existing laws, and to protect themselves against becoming future targets of enforcement. Our annual report is designed for business leaders, human resources professionals, corporate counsel, and other corporate decision-makers. We hope that it continues to provide them with useful commentary and analysis as they navigate EEOC-initiated litigation in 2022. This year’s book is available here.

In terms of the most interesting decisions and developments of the year, here is our list of the “top five” most intriguing developments of 2021:

Development #1: The Beginning Of A Post-Bostock Battle Between LGBTQ Rights And Religious Freedom

In recent years, the EEOC has aggressively campaigned to have LGBTQ discrimination recognized as a prohibited form of discrimination under Title VII. That issue was finally settled in the landmark decision of Bostock v. Clayton County, 140 S. Ct. 1731 (2020). On June 15, 2020, the U.S. Supreme Court held that Title VII prohibits discrimination against gay or transgender employees because it is tantamount to a form of sex discrimination. At the same time, the EEOC has also continued to direct its attention to religious discrimination and accommodation issues under Title VII. Many commentators see a potential conflict brewing between the religious liberty rights protected by the federal Religious Freedom Restoration Act (“RFRA”) and the Court’s Bostock decision.

The potential conflict between Bostock and the RFRA came to a dramatic head in at least one case this year, Bear Creek Bible Church v. EEOC, 2021 WL 5449038 (N.D. Tex. Nov. 22, 2021), a suit involving a non-denominational Christian Church and for-profit Christian institution that sought to avoid Title VII’s protections of LGBTQ employees under Botstock. In its opinion on November 22, 2021, the District Court held that the Christian Church was exempt from Title VII under the Act’s statutory exemption, and, although the for-profit Christian institution did not qualify for this exemption, it was not required to comply with Title VII since such compliance would substantially interfere with its free exercise of religion. The District Court observed that Bostock “expressly left open the implications for religious liberties and other matters arising from its decision,” and reasoned that “[f]orcing a religious employer to hire, retain, and accommodate employees who conduct themselves contrary to the employer’s views regarding homosexuality and gender identity” was not the least restrictive means of promoting that interest.

This is just one early decision exploring the potential conflict between LGBTQ and religious rights under Title VII. The full implications of Bostock’s impact on the American workforce will have to wait for future developments as it continues to be applied in courts across the county.

Development #2: A Focus On Pregnancy Discrimination

Pregnancy discrimination has been highlighted by the EEOC as an emerging and developing issue of concern for almost a decade. Yet cases alleging such discrimination and case law interpreting this area of the law have been few and far between. This year was a notable exception. In EEOC v. Wal-Mart Stores East, LP,  2021 U.S. Dist. LEXIS 214357 (S.D. Tex. Nov. 5, 2021), the EEOC alleged that an employer discriminated against a group of pregnant employees by failing to accommodate their pregnancy-related medical restrictions by allowing them to work light duty assignments under a temporary alternative duty program. Relying on the recent Supreme Court case (the ruling in Young v. United Parcel Service, Inc., 575 U.S. 206 (2015)), the District Court held that the EEOC must only show that the charging party’s employer accommodated others “similar in their ability or inability to work” and that employees can prove pretext “by providing sufficient evidence that the employer’s policies impose a significant burden on pregnant workers” and the employer’s “legitimate, non-discriminatory reasons are not sufficiently strong to justify the burden.” Because the EEOC failed to show whether and to what extent other injured employees (who were not injured on the job) were allowed to use the program, and, because pregnant employees and employees who were disabled (but not injured on the job) were apparently equally able to access the employer’s ADA accommodation policies, the District Court ruled in favor of the employer.

Development #3: A Return To The Basics In Female Employee And Applicant Discrimination

In EEOC v. Stan Koch & Sons Trucking, Inc., 2021 U.S. Dist. LEXIS 168297 (D. Minn. Aug. 30, 2021), the EEOC advanced a theory of liability that has flown under the radar in recent years. Specifically, the EEOC alleged that the use of a physical abilities test had a discriminatory impact on female applicants and introduced statistical evidence to prove its theory. The District Court ultimately concluded that the physical abilities test constituted “disparate impact” discrimination under Title VII, which prohibits facially neutral employment practices that fall more harshly on one group than another and cannot be justified by business necessity. The EEOC’s efforts to eliminate potential discrimination involving pre-employment screening tests has a long history. Those cases have fallen out of fashion somewhat as the EEOC has focused its attention on other ways that employers allegedly erect barriers to recruitment and hiring of certain groups. But the rise of third-party firms who offer assistance to employers in making employee selections could give rise to a new wave of these types of lawsuits. Employers who use such services must be certain that the methods they use are suited for their purpose and have been properly vetted for disparate impact.

Development #4: Pay Equity Continues To Loom As A Potent Source Of Discrimination Litigation

Lawsuits brought under the Equal Pay Act (“EPA”) tend to be highly fact-driven and therefore challenging for employers to dispense with through motion practice before trial. This is especially true when it comes to EEOC-initiated litigation. For example, in a recent case, EEOC v. University of Miami, 2021 U.S. Dist. LEXIS 186479 (S.D. Fla. Sept. 29, 2021), the EEOC alleged that the Defendant paid a female professor less than her male counterpart who performed the same job. The Defendant had hired the charging party as an associate professor during the same year that it hired a male professor with comparable qualifications for a lower-ranked position in the same department at a higher salary. The Defendant asserted that the EEOC could not establish a prima facie case of pay discrimination under the EPA because the professors had never performed substantially equal jobs. The District Court disagreed, finding that there remained a genuine issue of fact on this issue and as to whether the pay differential was based on factors other than sex.

Development #5: A Novel Procedural Issue Is Put To The Test

In EEOC v. Activision Blizzard, No. 21-CV-7682 (C.D. Cal. Dec. 20, 2021), the EEOC settled an enforcement lawsuit with an employer, and subsequently the California Department of Fair Employment and Housing (“DFEH”) objected to it. The District Court refused to allow the DFEH to intervene in the action and challenge the proposed consent decree and settlement on the ground that it had an interest in preserving potential state law claims against the Defendant. This ruling is the first time a federal court has decided whether to allow intervention on this basis, and the decision is certainly a favorable one for employers.  In this case, the EEOC filed suit on behalf of female employees alleging that they faced gender-based harassment and retaliation. The parties ultimately reached a settlement and proposed a consent decree that established a voluntary claims process. The DFEH sought to challenge the voluntary claims process because it claimed to have an interest in protecting its ability to prosecute its own parallel state court case against the Defendant. Since the consent decree released all state law claims, the DFEH claimed the consent decree would allow the Defendant to destroy evidence relevant to the DFEH’s state court case. The District Court disagreed and denied the motion. The District Court held that the interest actually belonged to those undergoing the claims process, not the DFEH, and if it were to accept the DFEH’s argument, the District Court would essentially be able to intervene in any employment action in the state. The District Court also reasoned it would be unlikely that it would ever enter a consent decree that would purport to allow or mandate destruction of evidence relevant to litigation.

Summing It All Up

In most respects, FY 2021 represented a return to form for the EEOC following a year of transition, stemming from significant changes to many of its programs in the midst of the global COVID-19 pandemic and significant leadership changes. The surge in the number of cases filed by the EEOC, particularly during the month of September, could mean that FY 2022 will be a much more litigation-intensive year. And, given the leadership changes that have rocked the agency over the past few years, it may also reveal a noticeable change in strategic direction as well. If so, employers should expect to see such new developments manifest themselves in the theories the Commission chooses to advance and the types of cases it files.

We will of course continue to monitor these developments, and we look forward to sharing our thoughts and analysis in the coming year.

Seyfarth Synopsis: In today’s video blog, Jerry Maatman discusses how, in 2021, the aggregate monetary value of workplace class action settlements exploded to an all-time high, as plaintiffs’ lawyers and government enforcement agencies monetarized their claims at the highest values we have ever tracked. Many employers and commentators alike expected the pandemic to depress the size and pace of settlements. Instead, the numbers show that the plaintiffs’ bar was successful in converting case filings into significant settlement numbers at higher levels during the pandemic than in any of the preceding years. Watch to learn more below!

By Gerlad L. Maatman, Jr.

Seyfarth Synopsis: As measured by the top 10 largest case resolutions in various workplace class action categories, overall settlement numbers skyrocketed in 2021 to an all-time high. The plaintiffs’ bar and government enforcement attorneys obtained significant settlements in a wide range of areas in 2021, and the overall “top ten” settlement values in 2021 in workplace class actions increased from those in 2020 in every area except for employment discrimination and government-initiated enforcement actions. For the first time ever, aggregate class action settlement recoveries in all categories exceeded the $3.6 billion threshold.

Although many employers and commentators alike expected the continuing impact of the pandemic to depress the size and slow the pace of settlements, workplace class action settlements defied expectations, and the plaintiffs’ bar was successful in converting case filings into significant settlement numbers at higher levels during the two years of the pandemic than during the two preceding years. After settlement numbers reached a high point in 2017, those numbers fell dramatically in 2018, and then leveled off in 2019. In 2020, the plaintiffs’ bar was successful in monetizing their class action filings at a higher level, signaling the beginning of an upward climb.

The momentum continued in 2021, as class action settlement recoveries reached a new high.

This past year, the plaintiffs’ bar drove the settlement of high-value class actions in multiple areas. Considering all types of workplace class actions, settlement numbers in 2021 totaled more than $3.62 billion, an increase compared to 2020, which totaled $1.58 billion, and from 2019, which totaled 1.34 billion. The 2021 totals exceeded the previous high-water mark reached in 2017, when such settlements topped $2.72 billion, setting a new benchmark. The following graphic shows this trend:

In terms of the story behind the numbers, the breakouts by type of workplace class action settlements are instructive.

In 2021, employers saw a monumental upward swing in the settlement values of wage & hour claims, ERISA class actions, and private statutory claims. In contrast, corporate America saw significant decreases across-the-board for resolutions of class actions involving employment discrimination claims and government enforcement litigation.

The following chart illustrates the overall results in these categories for 2021 settlement numbers:

By type of case, settlement values in wage & hour claims, ERISA class actions, and private statutory cases experienced the most significant increases.

On the wage & hour front, the value of the top 10 wage & hour class action settlements ballooned in 2021 to $641.3 million. In 2020, the value of those settlements fell off significantly from the previous year. In 2020, the value of the top 10 wage & hour settlements was $294.60 million, compared with $449.05 million in 2019.

In 2021, the value of the top 10 wage & hours class action settlements made a resurgence to a number higher than the number in any year of the past decade aside from 2016. The 2021 value of $641.3 million held slightly lower than the high water mark reached in 2016 ($695.5 million) but otherwise exceeded every other year of the past decade, including 2020 ($294.6 million), 2019 ($449.05 million), 2018 ($253.5 million), 2017 ($525 million), 2015 ($463.6 million), 2014 ($215.3 million), 2013 ($248.45 million), and 2012 ($292 million).

Considering the trend starting in 2015, aside from dips in 2018 and 2020, the value of the top 10 wage & hour settlements exceeded $400 million in every year, for an adjusted five-year average of $537.43 million, or an overall seven-year average of $462.18 million. Adding the numbers, corporate America saw over $3.235 billion devoted to settling the top 10 wage & hour settlements over that seven-year period.

As the plaintiffs’ class action bar continues to find avenues to avoid the impact of the 2018 ruling in Epic Systems on businesses inclined to adopt mandatory workplace arbitration programs with class action waivers, and as cases subject to that precedent continue to work their way out of the pipeline, we anticipate that settlement numbers will continue to climb in 2022.

The settlement value of the top 10 ERISA class actions climbed sharply in 2021. The top 10 settlements totaled $837.30 million, a substantial increase over the 2020 total of $380.10 million as well as the 2019 total of $376.35 million and the 2018 total of $313.40 million. ERISA settlements in 2021 climbed back closer to the levels employers saw from 2014 to 2017, during which period settlements totaled $1.31 billion (2014), $926.5 million (2015), $807.4 million (2016), and $927.8 million (2017), for an average over the four-year period from 2014 through 2017 of $992.93 million.

This trend is illustrated by the following chart of settlements from 2013 to 2021:

The top 10 settlements in the private plaintiff statutory class action category (e.g., cases brought for breach of contract for employee benefits, workplace antitrust laws, or statutes such as the Fair Credit Reporting Act or the Worker Adjustment and Retraining Notification Act) skyrocketed in 2021 to a new high. The settlements totaled $1.671 billion, which represents a significant increase over every year from 2016 forward and a reversal of a downward year-over-year trend that began in 2018. The previous high water mark, set in 2017, was $487.28 million. In 2018, settlements tapered to $411.15 million, followed by $319.65 million in 2019, and $244.55 in 2020.

The following chart tracks these figures:

Employment discrimination class action settlements, on the other hand, showed a decrease in 2021, as compared to 2020. In 2021, the top 10 settlements totaled $323.45 million, as compared to $422.68 million in 2020. In 2020, the value of the top 10 largest employment discrimination class action settlements of $422.68 million was the highest figure reached since we began tracking numbers, and $76.28 million higher than the next highest year recorded (2010).

While lower than the levels employers saw in 2020, the 2021 settlement numbers were significantly higher than previous years, including 2015 ($295.57 million) and 2017 ($293.5 million), and greatly exceeded those in 2012 ($48.65 million), 2013 ($234.1 million), 2014 ($227.93 million), 2016 ($79.81 million), 2018 ($216.09 million), and 2019 ($139.2 million). In fact, the top 10 settlements in 2021 of $323.45 million were higher than the average year-over-year value of the top 10 settlements from 2012 to 2020 of $217.5 million.

The comparison of the settlement figures with previous settlement activity over the last decade is illustrated in the following chart:

Relatedly, the top 10 settlements in government enforcement litigation experienced a downward turn in 2021, as they decreased to a total of $146.38 million.

In 2020, those settlements totaled $241.0 million, a significant jump from the $57.52 million employers saw in 2019 and from the $126.7 million recorded in 2018. Thus, although the numbers decreased in 2021, they outpaced the numbers lodged in 2014, 2015, 2016, and 2019 and fell closer to the average year-over-year value of the top 10 settlements from 2012 to 2020 of $168.82 million.

This trend is illustrated by the following chart of settlements from 2013 to 2021:

Settlement trends in workplace class action litigation are impacted by many factors. In the coming year, settlement activity is apt to be influenced by developing case law, case filing trends of the plaintiffs’ class action bar, the Biden Administration’s labor and employment enforcement policies, and class certification rulings.