In EEOC v. Consol Energy, Inc. et. al., Case No. 1:13-CV-215 (S.D. W. Va. Aug. 21, 2015), a jury found in favor of the EEOC in its claim brought under Title VII that the employer denied an employee a religious accommodation involving an exemption from using a biometric hand scanner. Prior to trial the parties filed motions in limine concerning certain issues relating to damages, which was held in abeyance pending trial. Id. at 1. Given the EEOC’s trial verdict, the Court then decided the motions and what damages (other than compensatory which was awarded by the jury) should be awarded. Id. at 2. For good measure, the Court also entered a significant injunctive relief award.
The ruling ought to be required reading for any corporate counsel and human resources professional dealing with EEOC litigation issues.
The Court’s Decision On Damages
With respect to monetary damages, the parties disagreed concerning the level of back and front pay the Charging Party should receive. Namely, the EEOC argued that the pension benefits the Charging Party received should not be used as an off-set to any back or front pay award as they are collateral (not paid directly from and entirely by the employer, rather, by a third source). Id. at 3. The collateral source rule provides that compensation from a collateral source should be disregarded in assessing damages. The employer argued that as the pension plan was 100% employer funded, it is a non-collateral source, and as such, should off-set any economic damages the Charging Party receives. Id. at 4.
The Court agreed with the EEOC and held that the pension benefits are a collateral source as “there has been no evidence that the fund is meant to be used as an indemnifying fund for potential litigation that is not in an employer’s favor” and “there has been no evidence that the applicable collective bargaining agreement contains a provision contemplating a set-off of benefits received in a case such as the one at hand.” Id. at 7.
The employer also argued that the Charging Party’s back and front pay award should be limited as he failed to adequately mitigate his damages. Id. at 11. Namely, that he failed to seek similar employment in the coal mining industry (he only attended a single job fair and didn’t seek similar employment as he did not want to lose his pension payments) and that he failed to apply for available openings in the coal industry that he was “likely aware.” Id. at 12.
The Court found that the Charging Party reasonably mitigated his damages given the limited available positions in the coal mining industry, his personal economic circumstances (he had a wife and two grandchildren to support at the time) and although he was skilled in certain industries, he was limited by his education for higher-paying jobs in his area as well as by his age. Id. at 18-20.
Given the Court’s ruling on damages, it awarded the Charging Party (before interest) $586,860.74 in economic damages. Id. at 39.
The Court’s Decision On Injunctive Relief
The EEOC also sought a company-wide permanent injunction that would dissolve after three years and prohibit the following: any requirement or rule for the use of a biometric hand scanner will be in conformity with Title VII as long as absent undue hardship on the defendants; provide a complete exemption as an alternative for persons who need such an exemption as a reasonable accommodation; and provide training to all management personnel regarding Title VII within 60 days of the injunction being entered. Id. at 25. In support of its request, the EEOC argued that once a plaintiff prevails in a Title VII case, “injunctions are presumptively appropriate.” Id.
The Court agreed with the EEOC and issued the permanent injunction it sought as “defendants have not met their heavy burden of proving that future discrimination will not occur.” Id. at 33. Although the Court noted that the employer had taken steps to eradicate any discrimination, that is not enough to warrant a denial of the injunction. Id. at 33. Furthermore, the Court found the scope of the injunction reasonable as it targets religious discrimination based on precedential case law and the biometric hand scanning device – which was at issue in the underlying lawsuit. Id. at 35.
Implications for Employers
This decision serves as a good primer on the factors that courts will rely upon in determining what damages are available (and, even if available, should be reduced). Although the Court ruled in favor of the EEOC in this case, employer access to specific types of claimant information can make a critical difference in mounting key defenses, testing claimant credibility, and limiting available damages.
Readers can also find this post on our EEOC Countdown blog here.