eeocseal.jpgBy Christopher DeGroff and Gerald L. Maatman, Jr.

A common theme for the EEOC’s systemic litigation is its large-scale, high-impact and high-profile cases. Typically, employers prefer to settle cases that allege a pattern or practice of discrimination for a reasonable amount, as opposed to taking such a case to trial. Settlements can reduce litigation expenses, protect the privacy of an employer, and shorten the time frame of a dispute. 

This year, the EEOC has secured several multi-million dollar settlements (discussed here and here), which underscore the Commission’s goals for prosecuting large-scale systemic litigation.  Most recently, the EEOC secured approval of another settlement in EEOC v. Interstate Distributor Co., No. 12-CV-02591 (D. Col. Nov. 8, 2012), a pattern or practice lawsuit involving allegations of systemic disability discrimination. Approved by Judge Brooke Jackson of the U.S. District Court for the District of Colorado, the consent decree put the EEOC’s claims to rest before the parties even exchanged discovery.

Background Of The Consent Decree

The case began when Lori Harris-Marshall filed a charge of discrimination with the EEOC alleging that the Defendant failed to accommodate her after she was injured on the job. Harris-Marshall also claimed that the Defendant would not allow her to return to work without a “full duty work release.” Id. at 1. Eight other employees then came forward and filed similar charges against the Defendant – alleging that company policies required the employees to be 100% healed and able to perform 100% of their job duties before they could return to work. The EEOC complied with its pre-suit investigation requirements and determined that the Defendant allegedly discriminated against nearly three hundred employees in similar scenarios. The EEOC then filed suit against the Defendant, asserting that it denied reasonable accommodations to hundreds of its employees and fired them pursuant to its unlawful leave policy. The EEOC also claimed that the Defendant violated the ADA because it allegedly terminated its employees if they requested more than 12 weeks of leave rather than determine if it would be reasonable to provide the employees additional leave as an accommodation. 

Rapidly after the EEOC filed this lawsuit, the case went into settlement proceedings. The parties negotiated a consent decree, and last week it reached Judge Jackson’s courtroom for final approval.     

The Contents Of The Consent Decree

Judge Jackson granted the EEOC’s motion for approval of the $4.85 million consent decree, which provides significant monetary relief to the class of allegedly aggrieved victims of disability discrimination. The monetary payment to the class of alleged victims provides the allegedly aggrieved individuals with back pay and compensatory damages.

In terms of equitable relief, the consent decree includes injunctions prohibiting the Defendant from future discrimination or retaliation based on disability. For the next three years, the Defendant must provide periodic training on the ADA to its employees in efforts to prevent such discrimination. Additionally, every six months the Defendant must provide the EEOC with information relating to terminations of employees, FMLA extensions, employees’ requests for accommodations, and disability complaints.

Implications For Employers

Although EEOC’s largest consent decree of the year topped $11 million in EEOC v. Yellow Transportation, Inc. and YRC, Inc., No. 09-7693 (N.D. Ill. June 28, 2012), the $4.85 million agreement in EEOC v. Interstate Distributor Co. is nothing to sneeze at. This is a big settlement for the EEOC and a reminder to employers to review their polices and consider whether they are over restrictive. This case also provides insight on settlements that seek quick relief. While it can take years to obtain a final resolution through settlement or trial, the parties in disposed of the EEOC’s claims in record time – one month. 

Readers can also find this post on our EEOC Countdown blog here.