By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis: A federal district court in Maryland recently denied in part an employer’s motion to dismiss a race discrimination action brought on behalf of African-born security guards by the EEOC, and instead granted the EEOC’s motion to stay so that the Commission could amend its deficient pre-suit letters of determination that were the subject of the employer’s motion to dismiss.

This is an important ruling for employers facing systemic EEOC actions, particularly regarding the strategy to challenge whether the EEOC has satisfied its Title VII pre-suit obligations.

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Case Background

In EEOC v. MVM, Inc., No. 17-CV-2864, 2018 U.S. Dist. LEXIS 81268 (D. Md. May 14, 2018), the EEOC alleged that MVM subjected a group of African-born employees to national origin discrimination, consisting of disparate treatment, a hostile work environment, and unlawful retaliation. Id. at *1. In October 2013, MVM hired a new project manager to oversee 400 security personnel, approximately half of whom were “African or foreign-born blacks.” Id. at *2. Within weeks of his hire, the project manager allegedly began complaining that there were “too many Africans” on the contract, that he was not comfortable working with foreigners, that he “couldn’t understand their accents.” Id.

During the project manager’s tenure, MVM also allegedly engaged in a variety of negative actions against African and foreign-born black security personnel, including denying them leave, forcing them to work on their scheduled days off, forcing them to work extra hours beyond their scheduled shifts, assigning them to undesirable posts, subjecting them to heightened scrutiny, disciplining them more harshly than called for by its discipline policy, intimidating and threatening them with termination, and denying them union representation so as to facilitate the imposition of discipline, suspensions, and termination without cause. Id. at *2-3.

Nine terminated employees filed charges with the EEOC. After the EEOC investigated the Charging Parties’ complaints, it issued Letters of Determination (“LODs”) on November 3, 2016, finding that there was reasonable cause to believe MVM had violated Title VII by discriminating against the Charging Parties through “unequal, terms, conditions, and privileges of … employment because of … national origin,” and/or had retaliated against the Charging Parties for engaging in protected activity. Id.

Following unsuccessful conciliation, on September 27, 2017, the EEOC brought suit on behalf of the Charging Parties and a group of allegedly aggrieved individuals. As amended, the complaint alleged five counts of violations of Title VII, consisting of: (I) a pattern or practice of discriminatory treatment based on national origin; (II) disparate terms and conditions of employment based on national origin; (III) a hostile work environment based on national origin; (IV) discharge and constructive discharge based on national origin; and (V) unlawful retaliation.

In its motion to dismiss, MVM primarily argued that the amended complaint contained claims of disparate treatment on behalf of a group of aggrieved individuals, including claims of discriminatory termination and constructive discharge, which went beyond the scope of the underlying LODs. MVM also argued: (i) discrimination based on “perceived” national origin was not cognizable; (ii) that certain allegations in the amended complaint were based on incidents that do not rise to the level of “adverse employment actions”; (iii) that the EEOC failed to state a plausible claim for constructive discharge; and (iv) that the EEOC failed to state a plausible claim of retaliation arising from the termination of one employee. Id. at *10. In its motion to stay, the EEOC requested that the Court stay the proceedings for 45 days to afford it an opportunity to amend its LODs and engage in conciliation efforts based on the amended LODs.

The Court’s Decision

The Court granted the EEOC’s motion to stay, and denied most of MVM’s motion to dismiss. First, in addressing the EEOC’s motion to stay, the Court noted that in the absence of a stay, either the Court would have to engage in detailed, fact-based analysis of the adequacy of the LODs, or the EEOC would dismiss and re-file the case. Id. at *14. In support of staying the case, the Court noted that its conclusion was supported by Mach Mining v. EEOC, 135 S. Ct. 645 (2015). Specifically, the Court held that “MVM’s rigid position that the EEOC may have only one opportunity to provide notice of charges through its LOD is inconsistent with … Mach Mining … to allow additional opportunities to provide notice of charges and engage in conciliation, precisely the steps that the EEOC seeks to accomplish through its proposed stay.” Id. at *13. Accordingly, the Court granted the EEOC’s motion to stay.

Next, having granted the motion to stay in order to permit the EEOC to amend the LODs, the Court held that MVM’s request for dismissal of claims that were not specifically identified in the LODs, such as discriminatory termination, was now moot. Id. at *16. Turning to MVM’s motion to dismiss claims alleging discrimination on the basis of “perceived” national origin, the Court likewise denied MVM’s motion, holding that “[t]o conclude otherwise would be to allow discrimination to go unchecked where the perpetrator is too ignorant to understand the difference between individuals from different countries or regions, and to provide causes of action against only those knowledgeable enough to target only those from the specific country against which they harbor discriminatory animus.” Id. at *17, 21. 

The Court next addressed MVM’s motion to dismiss any disparate treatment claims based on allegedly discriminatory actions other than suspension or termination. MVM asserted that any freestanding claims of disparate treatment in other specific matters, such as denying leave to African employees, forcing them to work on their scheduled days off, or assigning them to undesirable posts, necessarily failed because those actions did not constitute adverse employment actions for purposes of Title VII. The EEOC argued that it was making no such discrete claims, but rather, that the various discriminatory acts short of suspension and termination that were referenced in the amended complaint were offered collectively to establish a hostile work environment. Id. at *25. The Court rejected the EEOC’s argument and granted MVM’s motion to dismiss the nation origin disparate treatment claim, noting that hostile work environment, discriminatory termination, and retaliation claims were separately plead in other counts. The Court also denied MVM’s motion to dismiss constructive discharge and retaliation claims, holding that the EEOC plausibly stated claims for both. Accordingly, the Court denied in part and granted in part MVM’s motion to dismiss, and granted the EEOC’s motion to stay.

Implications For Employers

Since the U.S. Supreme Court issued its decision in the Mach Mining case in 2015, whether the EEOC has fulfilled its pre-suit obligations under Title VII has become a major area of focus for employers EEOC lawsuits. Here, although the Court generally acknowledged that the LODs were deficient, it avoided closely scrutinizing these pre-suit letters and allowed the EEOC to amend any deficiencies. Accordingly, while employers should not let one district court’s opinion deter them from challenging whether the EEOC fulfilled its pre-suit obligations, they should be cognizant that some courts will be more forgiving in allowing the EEOC to revisit failures to meet these obligations, as opposed to outright dismissing EEOC lawsuits.

 

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis: In an Equal Pay Act collective action lawsuit brought by female school crossing guards against the City of New York, who alleged they were paid less than male traffic enforcement agents, a federal district court in New York recently granted the City of New York’s motion for summary judgment, finding that significant differences between the two positions warranted the pay differential.

For employers facing Equal Pay Act claims relative to compensation differences for two similar but unique positions, this ruling provides a blueprint for attacking such claims.

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Case Background

In Miller v. City of New York, No. 15 Civ. 7563, 2018 U.S. Dist. LEXIS 73238 (S.D.N.Y. May 1, 2018), female New York City school crossing guards alleged violations of the Equal Pay Act (“EPA”), New York State Human Rights Law (“NYSHRL”), and New York City Human Rights Law (“NYCHRL”), arguing they were paid less than traffic enforcement agents, even though they claimed to do substantially the same work. Id. at *1-3. Approximately 96% of the school crossing guards are female, while 56% of the traffic enforcement agents are male.

At the time that the case was filed, school crossing guards were paid at an hourly rate ranging between $11.79 and $14.40 per hour, while traffic enforcement agents received an annual salary ranging from $33,751 to $40,930 per year, or approximately $16.16 to $19.60 per hour. Id. at *4. School crossing guards do not sit for a civil service examination or undergo psychological testing, do not have an educational requirement or need to possess a driver’s license, do not enforce traffic regulations, do not issue tickets or carry radios, and undergo one week of training. Traffic enforcement agents direct traffic, prepare and issue paper and electronic summonses, testify at administrative hearings and in court, and operate radios and other electronic equipment.

In October 2016, the Court conditionally certified a collective action on Plaintiffs’ EPA claim and also certified class claims under Rule 23  on Plaintiffs’ NYSHRL and NYCHRL claims. Id. at *1. Both classes were defined as female employees who are or were employed as school crossing guards from September 2012 through December 2016. Approximately 1,600 school crossing guards opted-in to the EPA collective action, and the NYSHRL and NYCHRL classes consisted of over 2,000 individuals. Thereafter, the City for New York moved for summary judgment on all claims.

The Court’s Decision

The Court granted the City of New York’s motion for summary judgment on all of the claims. First, regarding the EPA claim, the Court held that the stark differences in training, job requirements, and job responsibilities between traffic enforcement agents school crossing guards warranted summary judgment. Id. at *8. In support of its finding, the Court noted that traffic enforcement agents receive nearly ten times more training than school crossing guards, strongly suggesting the two positions require divergent skill levels. Further, traffic enforcement agents are full-time employees that can be required to work nights, weekends, and overtime, while school crossing guards are part-time employees who work no more than five hours per day, primarily during school hours. Plaintiffs argued that that both school crossing guards and traffic enforcement agents direct the flow of pedestrians and traffic, but the Court rejected this assertion as overly broad and not indicative of the actual job content. Accordingly, the Court granted the City of New York’s motion for summary judgment on the EPA claim.

Turning to the New York State Law Human Rights claim, the Court explained that discrimination claims under the NYSHRL are analyzed identically to claims brought under Title VII. Id. at *12. To establish a case of disparate pay under Title VII, a plaintiff must show: (1) she was a member of a protected class; (2) she was paid less than similarly situated non-members of her protected class; and (3) evidence of discriminatory animus. Id. (citation omitted). The Court found that Plaintiffs failed to meet the second element since female school crossing guards and male traffic enforcement agents were not similarly situated due to a myriad of factors, such as education, training, job requirements, job responsibilities, hours worked, and working conditions. Id. at *13. Accordingly, since no reasonable jury could find that Plaintiffs established a prima facie case under the NYSHRL, the Court granted summary judgment for the employer.

Finally, the Court analyzed Plaintiffs’ New York City Human Rights claim, noting that under New York City law, an employer may not discriminate in terms of compensation based on an employee’s gender. The Court explained that in order to succeed on their claim, Plaintiffs must identify appropriate comparators and present a sufficiently developed record from which a jury could conclude that the comparators received preferential treatment. Id. at *15 (internal quotation marks and citations omitted). The Court held that Plaintiffs failed to offer any proof of discriminatory animus, and there was no evidence in the record of a discriminatory motive underlying the disparate pay rates. Plaintiffs also argued there was a discriminatory impact, but the Court noted that Plaintiffs failed to allege this theory in their First Amended Complaint. Accordingly, the Court granted the City of New York’s motion for summary judgment.

Implications For Employers

Equal Pay Act collective actions and state law class claims relative to gender pay are on the rise, and employers absolutely need to take notice. For employers who are confronted with gender pay class actions involving wage comparisons for similar but unique positions, this ruling provides an excellent framework on how to defeat such claims by highlighting differences in areas such as job duties, education and training requirements. Nonetheless, the best way to avoid gender pay claims is to implement non-discriminatory pay practices, and make efforts to ensure that women and other members of protected classes are fairly and equally compensated.

 

By: Gerald L. Maatman, Jr. and Mark W. Wallin

Seyfarth Synopsis:  A Maryland federal district court recently found that a successor employer could be liable in an EEOC lawsuit for its predecessor’s alleged employment discrimination.  For employers, this decision is a cautionary tale — the lesson being that liability for claims of employment discrimination can extend beyond the entity alleged to have been responsible for the conduct to reach a successor entity that played no role in the alleged bad acts.  In light of this decision, due diligence in corporate acquisitions is more important than ever.  An entity acquiring not only assets but also employees must understand the risks of liability regarding the workforce it is inheriting.  As the Court decided here, no matter how explicit the disclaimer of liability, a successor may still be liable in an EEOC lawsuit for the discriminatory acts of its predecessor.

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In EEOC v. Phase 2 Invs. Inc., Case No. 17-CV-2463, 2018 U.S. Dist. LEXIS 65719 (D. Md. April 17, 2018), a Maryland district court denied motions to dismiss and for summary judgment brought by a successor employer and the predecessor employer, finding that the Court not only had jurisdiction over the claims against the successor employer, but also that the successor employer could be held liable for the discrimination allegations levied against its predecessor.  What’s more, the Court found that although the charging parties were undocumented workers, such status did not prevent the EEOC from pursuing Title VII claims on their behalf, contrary to the argument advanced by the predecessor employer. However, the Court recognized the precarious nature of the relief it could grant under such circumstances, as back pay and injunctive relief (i.e., re-hiring) are unavailable.  Nevertheless, the Court stated that the Defendants would not get off “scot-free” if the allegations were proven true.

Case Background

In EEOC v. Phase 2, Invs., Inc., the employee charging parties worked for Maritime Autowash, Inc. (“Maritime,” and later became Phase 2 Investments).  Maritime operated a car wash in Edgewater, Maryland.  The charging parties alleged that they and other Hispanic employees were subject to harassment and discrimination while working for Maritime, and that they were fired after they complained to management about the alleged mistreatment.  Notably, several months prior to their termination, an audit by U.S. Immigration and Customs Enforcement revealed that thirty-nine Maritime employees, including the charging parties, were not authorized to work in the United States.  According to the charging parties, Maritime management gave each of these employees money “so that they could obtain new papers and be re-hired . . . under new names.”  Upon their termination, in July 2013, the charging parties contacted the EEOC and eventually signed formal charges of discrimination against Maritime in February 2014.

In January 2015, after many months of negotiation, Maritime sold its assets including the Edgewater car wash to CWP West Corp. t/a Mister Car Wash (“Mister”).  According to Mister, the deal was structured as an asset purchase agreement, in order to avoid assuming Maritime’s existing liabilities other than those expressly stated in the agreement — which did not include employment discrimination liability.  However, as part of the purchase, Maritime did disclose to Mister its responses to the charges of discrimination filed by the charging parties with the EEOC.

In August 2017, after more than three years of investigation, litigation regarding EEOC subpoenas, and failed conciliation (including Mister), the EEOC filed suit against Maritime and Mister.  In its lawsuit, the EEOC alleged, pursuant to Title VII, race discrimination in the form of harassment, intimidation, unequal terms and conditions of employment, lower wages, denial of promotional opportunities, disparate discipline and discharge because of their race and in retaliation for engaging in protected activity.  Moreover, although the charging parties never worked for Mister, the EEOC alleged that Mister could be liable as a successor in interest.

On this record, Maritime and Mister moved for dismissal and summary judgment.  After considering Maritime and Mister’s arguments, the Court issued a thorough opinion rejecting them in total.

Jurisdiction

Mister first challenged the Court’s jurisdiction over it as a successor entity.  Although neither the charging parties nor the EEOC brought administrative charges against Mister — which is a jurisdictional requirement under Title VII — the Court found that it had jurisdiction over the claims.  Id. at *21.  To reach this conclusion, the Court drew a distinction between successor jurisdiction, and the more substantive inquiry regarding successor liability.  Id. at *26.  The former, it found, could be satisfied as long as the jurisdictional requirements were satisfied for the predecessor company, and the successor had notice of the charge and an opportunity to voluntarily comply.  Id. at *26.  Specifically, “[a] federal court has jurisdiction over a Title VII claim against a defendant-employer who was not named in an administrative charge of discrimination when the theory of liability rests on the actions of a different employer who was named in the charge of discrimination, and the defendant-employer had notice of the charge and an opportunity to voluntarily comply prior to the plaintiff bringing the claim in court.” Id. at *26 (emphasis in original).

Because Mister had notice of the charges prior to filing of the lawsuit, and even had the opportunity to conciliate with the EEOC, the Court found that Mister need not actually be named in a charge.  Id. at *27.  The Court rejected a formalistic approach that would require the refiling of the exact same charges against Mister.  Id.

Successor Liability And The Applicability Of Title VII To Undocumented Workers

Satisfied that it had jurisdiction over the claims, the Court moved on to address Mister and Maritime’s substantive arguments.  Maritime argued that because it never employed the charging parties, it should not be treated as successor for liability purposes under Title VII.  Further, Maritime argued that the charging parties’ status as undocumented workers required the lawsuit to be dismissed.

The Court held that as Maritime’s successor, Mister could be found liable under Title VII, despite the charging parties having never worked for Mister.  The Court stated that successor liability under Title VII was equitable in nature, and that the Court should thus “balance the needs of discriminatees and the national policy against discrimination . . . against the unfairness of holding an innocent purchaser liable for another’s misdeed . . .”  Id. at *39.  Specifically, the Court looked to three primary factors: “whether a successor had notice, whether a predecessor had the ability to provide relief, and the continuity of the business.”  Id. at *40-41.

As to notice, the Court distinguished successor liability notice from successor jurisdiction, stating that for liability purposes, Mister needed to have actual or constructive notice of the charges prior to purchasing Maritime’s assets.  Id. at *41.  While Mister’s knowledge as to the full extent of the charges was unclear, the Court found that Mister had at least constructive knowledge that Maritime faced some potential employment discrimination liability prior to purchase.  Id. at *41-42.  Indeed, the Court found it persuasive that Mister was a relatively sophisticated consumer that could have acted upon the red flags it uncovered during its due diligence.  Id. at *42.  Moreover, the Court noted that in the event the EEOC prevails and Mister suffers economic liability as a result, then Mister may look to the asset purchase agreement for recourse against Maritime, but that potential recourse against Maritime did not absolve Mister from liability “vis a vis the EEOC.”  Id. at *42-43.

The Court next found that as the former employer, Maritime would not be able to provide relief, because the EEOC sought injunctive relief that Maritime could no longer provide at this juncture.  Id. at *44.  As to the continuity factor, the Court held that because Mister continued to run essentially the same business, a car wash, this factor also weighed in favor of finding that Mister may be liable as a successor.  Id. at *45.  Accordingly, under these three factors, the Court determined that it would be equitable to hold Mister jointly and severally liability for any liability that Maritime incurred.  Id. at *46.

Finally, the Court addressed the thorny issue of whether discrimination against an undocumented worker was an unlawful employment action under Title VII.  Id. at *54.  After analyzing Title VII itself, along with Supreme Court and Fourth Circuit precedent, the Court found that “discrimination against an employee on the basis of his race, national origin, or participation in EEOC investigations is an unlawful employment practice under Title VII even if that employee is an undocumented alien, and the EEOC may therefore pursue its claim here.”  Id. at *65.  Among other things, the Court noted that finding otherwise would essentially give Maritime and other employers the ability to both hire undocumented workers and then unlawfully discriminate against those it unlawfully hired.  Id. at *64.  It further reasoned that “[e]ven if Maritime was unaware of the Charging Parties’ immigration status when it hired them, if the Court were to ‘sanction the formation of [that] statutorily declared illegal relationship’ by shielding Maritime (and its successors) from Title VII scrutiny, other employers may well find an incentive to look the other way when potential employees are unable to provide proper documentation.”  Id.

Nevertheless, the Court noted that as a result of the charging parties’ undocumented status, the nature of relief that could be sought was limited.  For instance, the Court found that it could not require Mister to re-hire the charging parties or award back pay.  Id. at *66.  Instead, the Court found that if the EEOC proves that Maritime discriminated against the charging parties, Title VII grants the Court broad discretion in fashioning relief and that the public interest would be best served through some monetary penalty.  Id.

Implications For Employers

This opinion should be required reading for any employer contemplating an acquisition of another company.  Indeed, the Court provided a detailed road map for when employment discrimination claims may be maintained against successor employers, even if such employees never worked for the successor and never named it in the charging documents.  Based on this decision, merely disclaiming the liability of a predecessor entity through an asset purchase agreement is not enough to shield a successor employer from the EEOC’s pursuit of employment discrimination liability — although such disclaimers are still useful for recouping any monetary loss against the predecessor entity.  Accordingly, through due diligence, employers must be sure to seek information regarding this potential employment liability, and understand the risks acquiring a company that has received charges of discrimination against it before deciding to proceed.  Willful ignorance is unlikely to be a fruitful defense to such claims.

By Gerald L. Maatman, Jr. and Matthew J. Gagnon

Seyfarth Synopsis: In a cautionary tale for all employers, the Eleventh Circuit recently upheld a jury verdict of intentional discrimination in an EEOC lawsuit when an employer hired a current employee who was facing an imminent lay-off, rather than the charging party. The employer’s policy was to favor internal candidates who were about to be terminated even if they were not the most qualified or “best” candidate for the open position. The Eleventh Circuit held that a reasonable jury could have found that the application of that policy was merely a pretext for discrimination.

In EEOC v. Exel, Inc., No. 14-11007, 2018 U.S. App. LEXIS 6629 (11th Cir. Mar. 16, 2018) (available here), the Eleventh Circuit considered and rejected an employer’s challenge to a jury verdict of liability in an EEOC lawsuit, but rejected the jury’s imposition of punitive damages. At issue was the employer’s policy of favoring current employees whose positions were being eliminated for other jobs within the Company, so those employees would not have to lose their jobs. The Eleventh Circuit upheld a jury verdict that was based on the finding that a Hiring Manager discriminated on the basis of sex even though he was ostensibly following the Company’s policy when he hired a soon-to-be-terminated male employee instead of the female charging party.

Case Background

In EEOC v. Exel, the charging party/intervenor complained that her supervisor had denied her a promotion because of her sex. At issue was how the Company filled vacancies. When a job became available, the Hiring Manager would submit an online job requisition for the vacancy. The HR department would then post the job and locate interested candidates from within and outside the Company. Internal applicants could apply on the Company’s website, like external candidates, or they could complete an internal application. HR would consider all candidates together and then forward the best candidates to the Hiring Manger.

However, the Company had a different procedure for considering current employees who were facing termination. The Company’s priority transfer practice (“PTP”) was designed to save employees who worked at a site that was about to undergo a workforce reduction from losing their jobs. Employees applying through the PTP process were given priority over other internal and external candidates as long as they met the minimum qualifications for the job, whether or not they were considered the “best” applicant for the position.

The charging party was passed over for promotion to a supervisory position in favor of an employee who was applying through the PTP process. The EEOC argued that the PTP process was merely a pretext for sex discrimination. It alleged that the Hiring Manager had informed the charging party “behind closed doors” that he would never make a woman a manager. It also alleged that he treated women differently than men and was more “stand-offish” with women.

A jury found in favor of the EEOC and awarded the charging party back pay, compensatory damages, and punitive damages. After trial, the employer filed a renewed motion for judgment as a matter of law with respect to liability and the imposition of punitive damages. The district court denied the motion with respect to liability, but vacated the punitive damages award. The EEOC appealed the vacatur to the Eleventh Circuit. The employer also cross-appealed the denial of its motion as to liability.

Eleventh Circuit Issues Split Decision On Question Of Liability

The Eleventh Circuit refused to overturn the jury’s verdict against the employer on the issue of liability. It was persuaded that a reasonable juror could have found against the employer because the jury heard evidence that: (1) the Hiring Manger had the discretion to hire the charging party despite being presented with a PTP candidate; and (2) the evidence showed that the Hiring Manager harbored a bias against women. Based on that evidence, the Eleventh Circuit held that a reasonable jury could have concluded that the Hiring Manager maintained discretion over his own hiring decisions regardless of the PTP process, and that he exercised that discretion in conformity with his discriminatory animus.

In a lengthy dissent, Judge Tjoflat vigorously disagreed with the majority’s conclusion. According to Judge Tjoflat, no reasonable juror could find that sex discrimination motivated the promotion decision at issue because there was insufficient evidence tying the decision-maker’s generalized discriminatory behavior to the specific employment decision at issue.

He agreed with the majority that the EEOC had presented sufficient evidence that would allow a reasonable factfinder to conclude that the Hiring Manager harbored discriminatory animus towards women. However, the dissent opined that there was not sufficient evidence to demonstrate that the Hiring Manager had any chance to put his alleged bias into action because the evidence demonstrated that he was simply following the PTP process when he hired a man for the open supervisory position instead of the charging party.

No Punitive Damages

With respect to punitive damages, the Eleventh Circuit noted that Title VII allows for the recovery of punitive damages only if an employer engaged in a discriminatory practice “with malice or with reckless indifference to the federally protected rights of an aggrieved individual.” Id. at *9 (quoting 42 U.S.C. § 1981a(b)(1)). That standard focuses on the decision-maker’s state of mind; however, the EEOC must also impute liability for the punitive damages to the employer.

Under prior Eleventh Circuit precedent, liability is imputable to an employer by showing either that the discriminating employee was high up in the corporate hierarchy, or that higher management countenanced or approved of the behavior. Id. at *10 (quoting Dudley v. Wal-Mart Stores, Inc., 166 F.3d 1317, 1323 (11th Cir. 1999)). However, the Supreme Court later held that punitive damages are imputable to an employer when the discriminatory actor was acting within the scope of employment and acting in a managerial capacity. See Kolstad v. Am. Dental Ass’n, 527 U.S. 526, 535 (1999). The Eleventh Circuit held that it was bound to apply its prior precedent because its subsequent decisions had continued to apply Dudley’s “higher management” standard even after Kolstad was decided. The Eleventh Circuit found that it was bound to apply that precedent unless and until it is overruled or squarely abrogated by the Supreme Court or the Eleventh Circuit sitting en banc.

Applying that standard, the Eleventh Circuit affirmed the district court’s decision vacating the award of punitive damages because the EEOC had failed to present evidence that the Hiring Manager (who was also a General Manager) was high enough in the corporate hierarchy. He was one of 329 other General Managers, and he oversaw only 25 employees. The EEOC had also failed to present evidence that any employee above the actor’s rank were aware of the discriminatory decision.

Implications For Employers

One point that was significant for the majority’s decision on liability was that the PTP process was not rigorously followed in all of its details when the discriminatory decision was made. Among other things, the Hiring Manager identified the wrong position when he submitted a requisition for the open position to Corporate HR. This opened the door for the EEOC to argue that the PTP process was merely a pretext for the decision, which the Hiring Manager had used as cover for the discriminatory animus that was really motivating his decision. According to the EEOC, the Hiring Manager requisitioned the wrong position as a means of ensuring that the charging party would not apply for the open position.

One lesson for employers to take away from this case is that any policy that favors one candidate over another is potentially problematic, even where the intentions behind the policy are to protect current employees from layoffs. Employers should take care to ensure that such policies are rigorously applied. Any deviations from that policy could later be called into question and even used against the employer as evidence that the application of that policy in that instance was merely a pretext for discrimination.

By: Gerald L. Maatman, Jr. and Alex Karasik

Seyfarth Synopsis: Over the past few weeks, two federal appellate courts have issued major decisions on the scope of workplace discrimination protections covered under Title VII of the Civil Rights Act of 1964 (“Title VII”).  In addition to creating a conflict between various past appellate court precedents, these decisions highlight an ideological divide between two major federal government agencies.  In this video blog, Associate Alex Karasik and Partner Jerry Maatman of Seyfarth Shaw discuss the importance of these decisions, and what employers can expect to see in the evolving debate over Title VII protections.

On February 26, 2018, the U.S. Court of Appeal for the Second Circuit issued an impactful decision in Zarda, et al. v. Altitude Express, d/b/a Skydive Long Island, et al., No. 15-3775 (2d Cir. Feb. 26, 2018), which fueled the debate over protections for sexual orientation under Title VII. The Second Circuit ruled in favor of a (now-deceased) skydiving instructor who claimed to be fired because he was gay, therefore ruling that sexual orientation is a protected category under Title VII.

Then, just last week, the U.S. Equal Employment Opportunity Commission (“EEOC”) notched a major win when the Sixth Circuit sided with the Commission’s position in EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., Nos. 16-2424 & 2018 (6th Cir. Mar. 7, 2018).  We previously blogged about this decision here.  This case considered a transgender worker.

These recent appellate court decisions have agreed with the EEOC’s position on the definition of sex discrimination under Title VII.  However, there is also significant opposition to this position – namely by the U.S. Department of Justice (“DOJ”).  In the Zarda case mentioned above, the EEOC and DOJ both submitted amicus briefs, taking completely opposite sides on this issue.  Additionally, the 11th Circuit issued a decision in March of 2017 entitled Evans v. Georgia Reg’l Hosp., No. 15-15234 (11th Cir. Mar. 10, 2017), which sided with the DOJ and a more strict interpretation of the workplace discrimination laws at hand.

In today’s video, Jerry and Alex discuss this controversial topic in detail, and provide their own insights on the matter.  As Jerry states in the video, what this issue looks to be driving towards is, “a showdown in the U.S. Supreme Court, or the halls of Congress, over the scope and parameters over the protections of Title VII.”

By Scott Rabe, Gerald L. Maatman, Jr., and Marlin Duro

Seyfarth Synopsis: In its recent decision in EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., No. 16-2424, 2018 U.S. App. LEXIS 5720 (6th Cir. Mar. 7, 2018), the U.S. Court of Appeal for the Sixth Circuit has sent the strong message that the Religious Freedom Restoration Act (“RFRA”) has minimal impact on the Equal Employment Opportunity Commission’s (“EEOC”) authority to enforce the anti-discrimination laws under Title VII of the Civil Rights Act of 1964 (“Title VII”).  The ruling is a big win for the EEOC.

In EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., a Sixth Circuit panel held in a unanimous decision that: (i) Title VII’s proscription of discrimination on the basis of sex encompasses a prohibition on discrimination based on transgender status, and that (ii) in this case the RFRA would not limit the EEOC’s authority to enforce anti-discrimination laws under Title VII.  With this decision, the Sixth Circuit became the first federal Court of Appeals to address the extent to which the RFRA may limit the EEOC’s power to enforce Title VII.[1]

Case Background

By way of background, the EEOC brought suit against a funeral home on behalf of a transgender employee, Aimee Stephens, who was terminated from her employment shortly after informing her employer that she intended to transition from male to female.  The EEOC alleged the funeral home violated Title VII by terminating Stephens’ employment on the basis of her transgender or transitioning status and her refusal to conform to sex-based stereotypes.  The funeral home argued that Title VII did not prohibit discrimination on the basis of transgender status and that the funeral home was protected from enforcement of Title VII by the  RFRA as the government action would constitute an unjustified substantial burden upon the funeral home owner’s exercise of his sincerely held religious beliefs.

Both parties moved for summary judgment and the district court found in favor of the funeral home on both motions  The district court found that Title VII did not protect against discrimination based on transgender status and that, while Stephens had suffered discrimination based on sex stereotyping, the RFRA prevented the EEOC from suing on her behalf.

The Sixth Circuit Appeal

On the EEOC’s appeal, the Sixth Circuit reversed the district court with respect to both motions and  granted summary judgment in favor of the EEOC. First, the Sixth Circuit held that the funeral home’s conduct violated Title VII, reinforcing its prior holdings that discrimination against employees because of their gender identity and transgender status are illegal under Title VII’s prohibition of sex discrimination based on sex stereotyping.  The Sixth Circuit explained that “discrimination on the basis of transgender and transitioning status is necessarily discrimination on the basis of sex” and found that firing a person because he or she will no longer represent him or herself as the gender that he or she was born with “falls squarely within the ambit of sex-based discrimination” forbidden under Title VII.  Id. at *18.

Second, the Sixth Circuit held that the EEOC’s enforcement of Title VII against the funeral home did not violate the funeral home’s rights under the RFRA.  A viable defense based on the RFRA requires a demonstration that the government action at issue would substantially burden a sincerely held religious exercise.  Although the Sixth Circuit treated the running of the funeral home as a sincere religious exercise by the owner, it held that the alleged burden caused by the enforcement of Title VII was not “substantial” within the meaning of RFRA.  The Sixth Circuit reasoned that tolerating an employee’s understanding of his or her sex and gender identity was not “tantamount to supporting it” and that mere compliance with Title VII, “without actually assisting or facilitating transition efforts,” did not amount to an endorsement by the employer of the employee’s views.  Id. at *59, *61.  Nor, the Sixth Circuit explained, could the funeral home rely on customers’ “presumed biases” against transgender individuals to meet the substantial burden test. Accordingly, the Sixth Circuit held that the funeral home had not demonstrated a substantial burden on the its religious exercise.

While the Sixth Circuit could have ended its analysis there, it went on to hold that even if tolerating Stephens’ gender identity and transitioning status were a “substantial burden” on the funeral home’s religious exercise, the EEOC did not violate the RFRA because the agency had a compelling interest in eradicating all forms of invidious employment discrimination, and enforcement of Title VII through its enforcement function was the least restrictive means for eradicating discrimination in the workforce.  This analysis, if found not to apply only to the facts of this case, could ostensibly doom any defense to a Title VII action within the Sixth Circuit where an employer raises a defense based on the RFRA.

Implications For Employers

The Sixth Circuit’s opinion is an important one, as it addresses two of the more hot button topics in employment jurisprudence:  the scope of the definition of “sex discrimination” under Title VII and the impact of laws protecting the free exercise of religion in the workplace.  On the former, this opinion joins the recent trend in decisions finding that gender identity is inextricably linked with sex and therefore is protected under Title VII.  And on the latter, the Sixth Circuit has laid down a gauntlet as the first federal circuit addressing the RFRA’s impact on the EEOC’s Title VII enforcement power.  The decision is clearly intended to send a strong message that the RFRA has limited application, if any, in defense of a Title VII action brought by the Commission.  While time will tell whether other federal circuits will adopt a similar interpretation, if the Sixth Circuit’s legal rationale is followed, employers will be hard-pressed to defend Title VII claims brought by the EEOC based on the alleged exercise of religious freedom.

In light of the current uncertainty regarding the ultimate interpretation of Title VII as it applies to gender identity, employers should regularly review their policies to ensure that adequate protections are provided to employees on the basis of their gender identity, and transgender and transitioning status.  As always, we also invite employers to reach out to their Seyfarth contact for solutions and recommendations regarding anti-harassment and EEO policies and addressing compliance with LGBTQ+ issues in the law.

[1]              The RFRA, enacted in 1993, prohibits the government from enforcing a law that is religiously neutral against an individual, if the natural law “substantially burdens” the individual’s religious exercise and is not the least restrictive way to further a compelling government interest.  Importantly, the RFRA applies only in the context of government action, and therefore would not provide a defense for an employer in a civil suit brought by a private plaintiff.

By Gerald L. Maatman, Jr., Christopher J. DeGroff, Matthew J. Gagnon, & Kyla Miller

Seyfarth Synopsis: This month the EEOC released its 2018-2022 strategic plan, which focuses on preventing and combating discrimination and improving the EEOC’s organizational functionality. It also released the agency’s 2019 budget request, which mirrors its $363 million dollar request from last year.

Strategic Plan: FY 2018-2022

On February 12, 2018, the EEOC approved its Strategic Plan for fiscal years 2018-2022 (available here). The EEOC is required to publish a strategic plan, which serves as a framework for the EEOC in implementing its mission to combat employment discrimination. The Strategic Plan is not to be confused with the Strategic Enforcement Plan. We like to think of the Strategic Enforcement Plan as the “what,” and the Strategic Plan as the “how.” The Strategic Enforcement plan, discussed more fully here, explains what priorities the EEOC will focus on. More generally, the Strategic Plan lays out the high level overview of how the agency is going to achieve those objectives. The 2018-2022 strategic plan includes three general objectives:

  1. Combat and prevent employment discrimination through the strategic application of the EEOC’s law enforcement authorities.

The EEOC has outlined two outcome goals of this strategic objective. First, the EEOC aims to stop and remedy discriminatory employment practices and provide meaningful relief to victims. Second, the EEOC would like to exercise its enforcement authority fairly, efficiently, and based on the circumstances of each charge or complaint.

  1. Prevent employment discrimination through education and outreach.

This objective reflects the EEOC’s interest in deterring employment discrimination before it occurs. The primary means to this goal includes investigations, conciliations, and litigation. The EEOC’s two goals for this strategic objective include helping members of the public understand the law and their rights, and for employers, unions, and employment agencies to prevent discrimination and address EEO issues when they occur.

  1. Management objective.

This objective is focused on the EEOC “achieving organizational excellence,” which includes improving management functions with a focus on information technology, infrastructure enhancement, and accountable financial stewardship. The EEOC pledged accountability for improving its operations where needed. The two outcome goals for this objective include having staff that exemplify a culture of excellence, respect and accountability, and allocating resources effectively to ensure they line up with their stated priorities.

FY 2019 Budget Request

With its new strategic plan also comes a new budget request (available here). The EEOC is requesting $363,807,086 for fiscal year 2019, which includes $29,443,921 for state and local fair employment practice agencies (FEPAs) and tribal employment rights organizations (TEROs).

The EEOC urges congressional support, citing its commitment to building a digital workplace to increase their efficiency and provide timely service to the public. The agency also states a need for more staff and resources to deliver high quality service. The EEOC says that it intends to maintain its staffing levels in order to further reduce the charge backlog. The funding is also anticipated to cover “rents and mandatory office relocations.”

This request is  $1.783 million over the fiscal year 2018 Continuing Resolution level, but is the exact same budget request it made for fiscal year 2018. This year’s budget goals include: (1) investing in the “agency of the future”; (2) managing the inventory and reducing backlog; (3) improving and leveraging technology; and (4) outreach, education, and strategic law enforcement. Time will tell if the EEOC’s budget request will be approved, and whether it will use that money wisely.

Implications For Employers

As anyone who is paying attention to the news knows, the future direction of the budget for many federal agencies is a bit uncertain. For example, President Trump’s recently released budget proposes huge cuts for a different federal agency — the Consumer Financial Protection Bureau. This makes the relative stability of the EEOC’s budget request somewhat remarkable. Whether it can continue to fly under the radar of federal budget cutting remains to be seen. In the meantime, employers should keep in mind that the EEOC managed to file an impressive number of lawsuits last year while operating under pretty much the same budgetary constraints that are proposed for fiscal year 2019.

Seyfarth Synopsis: On October 5, 2017, U.S. Attorney General Jeff Sessions issued an agency memorandum stating that the language contained in Title VII of the Civil Rights Act of 1964, “does not prohibit discrimination based on gender identity per se, including transgender status.” It represented a head-snapping pivot of the position of the U.S. Department of Justice. In this video, Jerry Maatman of Seyfarth Shaw, LLP gives blog readers an overview of the recent history regarding legal interpretation of Title VII. Jerry discusses potentially conflicting statutes and court rulings, as well as the ways in which this Department of Justice memorandum could affect businesses and those who litigate under Title VII.

Summary

Title VII of the Civil Rights Act of 1964 has been a prevalent federal statute since its passage over 50 years ago. Therefore, it is an especially important statute to understand for nearly every employer. During the Obama Administration, Attorney General Eric Holder stated in a 2014 memorandum that the Department of Justice does, in fact, apply the concept of sex discrimination in the workplace to transgender workers. However, Congress has rejected all attempts thus far to amend Title VII. To that end, the language of the law leaves legal interpretation open for debate.

The EEOC’s current view of Title VII is that it includes protections for transgender workers. In addition, 20 states and the District of Columbia include both sexual orientation and gender identity as protected categories under their discrimination statutes. The recent statement by the Department of Justice has renewed the widespread debate over the definition of sex discrimination, a dispute which we suspect will not end any time soon. Make sure to stay tuned to our blog and Twitter account for updates and insights on this important legal issue!

By Matthew J. GagnonChristopher J. DeGroff, and Gerald L. Maatman, Jr.

Seyfarth Synopsis: With uncertain times and profound changes anticipated for the EEOC, employers anxiously await what enforcement litigation the EEOC has in store. Although 2016 showed a marked decline in filings, fiscal year 2017 shows a return to vigorous enforcement filings, with a substantial number of filings in the waning days of the fiscal year.

Employers are living in uncertain times. The impact of a Trump Administration and the EEOC’s new Strategic Enforcement Plan (SEP) for fiscal years 2017-2021 are still working themselves out in the FY 2017 filing trends. Nonetheless, one trend has reemerged: a vigorous number of EEOC case filings. It looks like the anemic numbers of FY 2016 were just a bump in the road, as FY 2017 has revealed an increase in total filings, even eclipsing the numbers from FY 2015 and 2014. (Compare here to here and here.) This year, the EEOC filed 202 actions, 184 merits lawsuits and 18 subpoena enforcement actions.

The September filing frenzy is still an EEOC way-of-life, as this past month yet again holds the title for most filings compared to any other month. At the time of publication, 88 lawsuits were filed in September, including 21 in the last two days alone. In fact, the EEOC filed more cases in the last three months of FY 2017 than it did during all of FY 2016. The total number of filings for the remaining months remains consistent with prior years, including a noticeable ramp up period boasting double digit numbers through the summer.

Filings out of the Chicago district office were back up in FY 2017 after an uncharacteristic decline to just 7 total filings in 2016. This year, Chicago hit 21 filings, an enormous increase from last year. This is closer to the total number of Chicago filings in FY 2015 and 2014 (26 in each year). The Los Angeles district office also increased its filings, hitting a high of 22, a substantial jump compared to previous years and the most of any district office in FY 2017. On the other end of the spectrum, the Phoenix district office has seen a notable drop, with only 7 filings compared to 17 in FY 2016.

New SEP, Same Focus

Every year we analyze what the EEOC says about its substantive focus as a way to understand what conduct it is targeting. This year, Title VII takes center stage. Although Title VII has consistently been the largest category of filings, last year showed a dip in the percentage of filings alleging Title VII violations, at only 41%. Nonetheless, this year Title VII has regained its previous proportion, accounting for 53% of all filings. This is on par with FY 2015 and 2014, showing once again that FY 2016 seems to have been an outlier.

Although the 2017-2021 SEP outlined the same general enforcement priorities as the previous version of the SEP (covering FY 2012 to 2016), the new SEP added “backlash discrimination” towards individuals of Muslin/Sikh/Arab/Middle Eastern/South Asian communities as an additional focus. One would expect this focus might increase the number of Title VII claims alleging either religious, racial, or national origin discrimination. However, those filings stayed relatively even, and were even a bit down from previous years. Religious, national origin, and race discrimination claims made up 42% of all Title VII claims, compared to 50% in 2016 and 46% in 2015.

Uncertainty For Equal Pay Claims

With a new administration came a new Acting Chair for the EEOC. President Trump appointed Victoria Lipnic as Acting Chair on January 25, 2017. Employers expected the EEOC’s new leader to steer the EEOC’s agenda in a different direction. Some believed Lipnic was foreshadowing future trends when she made it clear at her first public appearance – hosted by none other than Seyfarth Shaw – that she is “very interested in equal pay issues.” (See here.) And indeed, we have seen a slight uptick in the number of EPA claims filed in FY 2017. In FY 2017, The EEOC filed 11 EPA claims, compared to 6 in 2016, 5 in 2015, and 2 in 2014.

However, on June 28, 2017, President Trump tapped Janet Dhillon as Chair of the EEOC. Dhillon would come to the EEOC with extensive experience in a big law firm and as the lead lawyer at three large corporations, US Airways, J.C. Penney, and Burlington Stores Inc. Although it is too early to know how she could change the direction of the agency if confirmed, it is entirely possible that she could back away from previous goals to pursue equal pay claims more aggressively.

The Trump Administration has also made other moves that may indicate a change in direction with respect to equal pay initiatives. On February 1, 2016, the EEOC proposed changes to the EEO-1 report that would require all employers with more than 100 employees to submit more detailed compensation data to the EEOC, including information regarding total compensation and total hours worked by race, ethnicity, and gender. This was a change from the previous EEO-1 report, which only required employers to report on employee gender and ethnicity in relation to job titles. However, on August 29, 2017, the new EEO-1 reporting requirements were indefinitely suspended. We will have to wait and see whether the slight uptick in EPA claims in FY 2017 was a one-year anomaly.

Implications For Employers

The changes brought by the Trump Administration are still in the process of working themselves down into the rank and file of many federal agencies. The EEOC is no exception. Despite all of the unrest and uncertainty about where the EEOC may be headed, the FY 2017 filing trends largely show a return to previous years, albeit with a slight uptick in EPA claims. Certainly, changes in top personnel will have an impact on how the EEOC pursues its enforcement agenda. Exactly what that impact will be remains to be seen.

Loyal readers know that this post is merely a prelude to our full analysis of trends and developments affecting EEOC litigation, which will be published at the end of the calendar year. Stay tuned for our continued analysis of FY 2017 EEOC filings, and our thoughts about what employers should keep an eye on as we enter FY 2018. We look forward to keeping you in the loop all year long!

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

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth SynopsisAfter a federal district court dismissed the EEOC’s unlawful-interference claim against a private college that had sued a former employee for allegedly breaching a settlement agreement by filing an EEOC charge, the Tenth Circuit reversed the dismissal of the EEOC’s unlawful-interference claim, citing the employer’s introduction of a new case theory relative to the EEOC’s still-pending retaliation claim.

This ruling serves a cautionary tale for employers regarding the timing of their assertion of new case theories in EEOC litigation involving multiple claims.

***

After CollegeAmerica resolved a dispute with a former employee by entering into a settlement agreement, upon belief that the employee breached the settlement agreement, CollegeAmerica sued the employee in state court.  Id. at *1-2.  Thereafter, the EEOC sued CollegeAmerica in federal court alleging that CollegeAmerica’s interpretation and enforcement of the settlement agreement was unlawfully interfering with statutory rights of the former employee and the EEOC.  Following the U.S. District Court for the District of Colorado’s dismissal of the EEOC’s claim for unlawful-interference with statutory rights, on appeal in EEOC v. CollegeAmerica Denver Inc., No. 16-1340, 2017 U.S. App. LEXIS 17094 (10th Cir. Sept. 5, 2017), the Tenth Circuit reversed the dismissal, holding that the EEOC’s unlawful-interference claim should not have been dismissed as moot in light of a new theory asserted by CollegeAmerica prior to its trial regarding the EEOC’s pending retaliation claim.

Employers should keep this ruling in mind when preparing trial theories that may have implications on claims that had previously been dismissed as moot.

Case Background

The EEOC brought a claim for unlawful-interference with statutory rights, which the District Court ultimately dismissed as moot.  Regarding the EEOC’s retaliation claim, which remained for trial, CollegeAmerica presented a new theory against the employee: that she had breached the settlement agreement by reporting adverse information to the EEOC without notifying CollegeAmerica.  In response, the EEOC argued that by presenting this new theory, CollegeAmerica was continuing to interfere with the statutory rights of the former employee and the EEOC.  As such, the EEOC appealed the dismissal of its unlawful-interference claim, arguing that the claim was no longer moot in light of CollegeAmerica’s new theory.

The Tenth Circuit’s Decision

The Tenth Circuit reversed the dismissal of the of the EEOC’s unlawful-interference claim.  First, the Court instructed that in determining whether a claim is moot, a special rule applies when the defendant voluntarily stops the challenged conduct.  Id. at *4-5.  When the conduct stops, the claim will be deemed moot only if two conditions exist: (1) it is absolutely clear the allegedly wrongful behavior could not reasonably be expected to recur, and (2) interim relief or events have completely and irrevocably eradicated the effects of the alleged violation.  In arguing that the case was moot, CollegeAmerica submitted two declarations from its general counsel assuring that CollegeAmerica would not take the “positions known to trouble the EEOC.”  Id. at *6.  In response, the EEOC argued that the declarations should not be relied upon since CollegeAmerica presented a new theory after the filing of the declarations–that the employee had breached the settlement agreement by reporting adverse information to the EEOC without notifying CollegeAmerica–an argument that continued CollegeAmerica’s unlawful interference with statutory rights.  The Tenth Circuit held that because CollegeAmerica planned to present its new theory in its state court suit, the potential for CollegeAmerica to repeat its allegedly wrongful behavior remained, and CollegeAmerica thus did not satisfy its burden of demonstrating the absence of a potential for reoccurrence.  Id.

Next, the Tenth Circuit rejected CollegeAmerica’s argument that the case was moot because the outcome “would not affect anything in the real world.”   Id. at *7.  The Tenth Circuit noted that in its state court suit, CollegeAmerica planned to argue that the employee breached the settlement agreement by reporting adverse information to the EEOC without notifying CollegeAmerica. The EEOC alleged that this argument would constitute unlawful-interference with the employee’s rights, and thus sought a permanent injunction prohibiting CollegeAmerica from unlawfully interfering with the statutory rights of the employee and the EEOC.  The Tenth Circuit accepted the EEOC’s argument, holding that if the EEOC prevailed on the merits and obtained an injunction, CollegeAmerica could not present its new theory in the state court suit against the employee, which “would constitute an effect in the real world.”  Id.

Finally, the Tenth Circuit declined to consider CollegeAmerica’s argument that the EEOC’s unlawful-interference claim brought under 29 U.S.C § 626(f)(4) failed as a matter of law since it could not be used as an affirmative cause of action, noting the District Court had not yet ruled on the issue and therefore it was to consider that issue on remand.  Id. at *7-8.  The Tenth Circuit also refused to consider CollegeAmerica’s argument that the EEOC sought overly broad, unauthorized injunctive and declaratory relief, explaining it would not consider this issue since it was raised on appeal for the first time.  Accordingly, the Tenth Circuit reversed and remanded the District Court’s dismissal of the EEOC’s unlawful-interference claim.

Implications For Employers

For employers facing litigation, this ruling provides an important lesson: when considering the defense of one claim, it is imperative to be cognizant of how that argument can impact the defense of another claim, even if the other claim has been dismissed.  Further, this decision illustrates the EEOC’s willingness to combat employers who bring causes of action against former employees who may have breached settlement agreements by asserting discrimination claims.  As such, employers should be cautious when suing former employees who later file EEOC charges, and must exercise further caution when considering how their strategies to defend one claim may affect another.

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