By Gerald L. Maatman, Jr. and Jennifer A. Riley

Today, less than three weeks after oral argument, the Sixth Circuit affirmed a lower court order granting summary judgment in favor of Kaplan in one of the EEOC’s most high profile cases – – EEOC v. Kaplan Higher Education Corp., No. 13-3408 (6th Cir. April. 9, 2014).

The EEOC brought suit against Kaplan for using credit checks in its hiring process – “the same type of background check that the EEOC itself uses” the Sixth Circuit pointed out – claiming that the practice had a disparate impact on African Americans. Id. at 2.

On January 28, 2013, Judge Patricia A. Gaughan of the U.S. District Court for the Northern District of Ohio granted summary judgment in favor of Kaplan, finding that the EEOC’s statistical evidence of disparate impact was not reliable and not representative of Kaplan’s applicant pool as a whole. (Read more about that ruling here.) 

The Sixth Circuit found no abuse of discretion. The EEOC’s “homemade” methodology for determining race – by asking its “race raters” to label photographs – was, in the Sixth Circuit’s words, “crafted by a witness with no particular expertise to craft it, administered by persons with no particular expertise to administer it, tested by no one, and accepted only by the witness himself.” Id. at 7.


The EEOC filed suit against Kaplan alleging that Kaplan’s use of credit checks causes it to screen out more African-American applicants than white applicants, creating a disparate impact in violation of Title VII. Id. at 2. 

In support of its allegations, the EEOC relied on statistical data compiled by Kevin Murphy.  Because Kaplan’s credit check process was race-blind, the EEOC subpoenaed records regarding Kaplan’s applicants from state departments of motor vehicles. Id. at 3. Thirty-six states and the District of Columbia provided color copies of approximately 900 drivers’ license photos. 

Murphy assembled a team of five “race raters” and directed them to review the photos and classify them as “African-American,” “Asian,” “Hispanic,” “White,” or “Other.”  Murphy also provided the raters with applicant names. Id. at 3-4. 

Based on the results of this “race rating,” Murphy opined that, in a sample of 1,090 (out of 4,670 applicants), the percentage of black applicants who were flagged for review based upon their credit histories was higher than the percentage of white applicants who were flagged.  Id. at 4.

The district court excluded Murphy’s testimony as unreliable for two reasons. First, the EEOC presented “no evidence” that Murphy’s methodology satisfied any of the factors that courts typically consider in determining reliability under Federal Rule of Evidence 702; and second, as Murphy himself admitted, his sample was not representative of Kaplan’s applicant pool as a whole. Id. at 2. The district court granted summary judgment in favor of Kaplan, and the EEOC appealed.

The Sixth Circuit’s Opinion

The Sixth Circuit affirmed. The Sixth Circuit noted that, as the proponent of expert testimony, the EEOC bears the burden of proving its admissibility. Id. at 5. It determined that the district court did not abuse its discretion in finding that the EEOC failed to make such a showing.   

The EEOC argued that the district court erred in finding that it had “wholly fail[ed]” to provide evidence that its technique had been tested or had any “known or potential rate of error.” Id. The EEOC contended that it provided such support in the form of “anecdotal corroboration.” That is, as to 57 applicants, Murphy cross-checked his raters’ classifications with racial identifications provided by a DMV or Kaplan. Id.

The Sixth Circuit noted that the EEOC’s cross-check yielded an 80% match – “an unimpressive correlation in case where a few percentage points (in credit-check fail rates for blacks and whites) might make the difference between significant liability and none.” Id. In any event, as Murphy himself conceded, a mere 57 instances of anecdotal corroboration is “not enough” to establish the reliability of his photo rating methodology. Id. at 5-6. 

As the Sixth Circuit found, “[t]he EEOC’s case goes downhill from there.” Id. at 6. The EEOC failed to present evidence that its technique was subjected to peer review or publication, failed to show that Murphy employed standards to control “the technique’s operation,” and presented no evidence that Murphy’s race-rating methodology was “generally accepted in the scientific community.” Id. at 6-7. “[T]he raters themselves had no particular standard in classifying each applicant; instead, they just eyeballed the DMV photos.” Id. at 6.

Finally, as an independent ground for excluding Murphy’s testimony, the district court found “no indication” that Murphy’s group of 1,090 applicants was representative of the applicant pool as a whole. Id. at 7. The Sixth Circuit noted that, “[i]nstead there is a strong indication to the contrary: Murphy’s group had a fail rate of 23.8%, whereas the GIS applicant pool had a fail rate of only 13.3%.” Id. It held that an unrepresentative sample “by definition” might skew the respective fail rates of black and white applicants in the larger pool – “and thus is not a reliable means to demonstrate disparate impact.” Id.


In its opinion, the Sixth Circuit staunchly critiqued the EEOC’s “do as I say, not as I do” litigation tactics. It noted (in the first line of its opinion) that the EEOC “sued the defendants for using the same type of background check that the EEOC itself uses.” Id. at 2. It also noted, as the district court observed, that “the EEOC itself discourages employers from visually identifying an individual by race and indicates that visual identification is appropriate ‘only if an employee refuses to self identify.’” Id. at 7.

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

By Matthew Gagnon and Gerald L. Maatman, Jr.

The EEOC has taken some high-profile hits lately, see here and here, but in EEOC v. Baltimore County, No. 13-1106 (4th Cir. Mar. 31, 2014), the EEOC scored a victory against Baltimore County, Maryland, which had an employee retirement benefit plan that the EEOC alleged unlawfully discriminated against older workers in violation of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621-634. The Fourth Circuit held that it is unlawful to require older employees to contribute a larger percentage of their salaries to a retirement plan that bases retirement eligibility on years of service rather than meeting a specified retirement age. 


In 1945, Baltimore County established a retirement benefit plan that provided that employees were eligible to retire and receive pension benefits at age 65, regardless of the length of their employment. Baltimore Cnty., at 4. The plan was funded, in part, from contributions by employees who contributed a fixed percentage of their annual salaries to the plan. Id. at 5. To ensure that all employees received the same level of benefits, contribution rates were based on, among other things, the number of years that an employee would contribute to the plan before being eligible to retire at age 65. Id. Older employees therefore ended up paying a greater percentage of their salaries to the plan. Id. at 6.

Over the years, the County modified its plan so that correctional officers became eligible to retire after only 20 years of service, regardless of age, or at age 65 with five years of service. Id. at 6-7. Two correctional officers filed charges of discrimination with the EEOC, alleging that the disparate contribution rates discriminated against them on the basis of age. Id. at 7-8.

The County actually won on summary judgment back in 2009. The District Court held that the plan’s disparate contribution rates were not motivated by age, but rather by the number of years remaining until an employee reached retirement age. The different contribution rates were permissible because older new-hires had less time to accrue earnings on their contributions and because of the “time value” of money. EEOC v. Baltimore Cnty., No. 07-CV-2500 (D. Md. Jan. 21, 2009). The Fourth Circuit vacated that judgment, holding that the District Court had considered only the age-based retirement eligibility requirement, and had failed to consider the plan’s separate provision for service-based eligibility. EEOC v. Baltimore Cnty., No. 09-1688 (4th Cir. June 25, 2010). On remand, the District Court granted partial summary judgment in favor of the EEOC. EEOC v. Baltimore Cnty., No. 07-CV-2500 (D. Md. Oct. 17, 2012).

Fourth Circuit Decision

The County’s primary argument on appeal was that the District Court had failed to apply the factors identified by the Supreme Court in Kentucky Retirement Systems v. EEOC, 554 U.S. 135 (2008). But the Fourth Circuit held that that case was inapplicable to the District Court’s analysis because it presented a different question: whether “pension status” unlawfully constituted a “proxy for age.” In that case, the plan treated employees differently based on their pension status rather than on their age. But Baltimore County’s plan required different contribution rates explicitly in accordance with employees’ ages at the time of their enrollment in the plan. The employee’s eligibility to retire (i.e., “pension status”) therefore had no bearing on the disparate treatment in that case, i.e., that older employees were required to contribute a higher percentage of their salaries to the plan than younger employees. Baltimore Cnty., at 13-15.

An employer violates the ADEA by relying on a facially discriminatory policy where age is the “but-for” cause of disparate treatment of older employees. Accordingly, the only question in Baltimore County was whether the disparate contribution rates were lawfully based on a reasonable factor other than age. Id. at 15. While there may have been some basis for such disparate treatment at the plan’s inception – when the only basis for reaching retirement eligibility was reaching retirement age – that justification disappeared when the plan was modified to allow employees to retire based solely on a set number of years of service. Id. 

Under the terms of the plan, correctional officers were eligible for retirement after 20 years of service. So a 20-year-old and a 40-year-old would both be eligible to retire after 20 years, but the 40-year-old would still have to contribute more of his or her income to the plan over the same twenty years to receive the same retirement benefits. Because the plan required older employees to contribute more of their income to the plan regardless of whether they chose to retire after reaching retirement age or after working the required number of years, the number of years until retirement age could not be the basis for the disparate rates. Id. at 15-16. Accordingly, the disparate rates were not motived by anything other than age, and were a violation of the ADEA. Id.

Implications For Employers

This case demonstrates the complexities and potential pitfalls employers face while trying to navigate the ADEA. It often makes sense to treat older and younger employees differently under a retirement plan in order to ensure that all employees receive the same level of plan benefits. But employers must be aware that any such differences will be considered facially discriminatory and therefore must be based on a reasonable factor other than age. The plan must be carefully structured so that any age-based disparities are actually justified by the different financial considerations that might apply to older employees when calculating plan benefits and contributions.

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

By Gerald L. Maatman, Jr. and Howard M. Wexler

On February 4, 2014 the U.S. Court of Appeals for the Second Circuit dealt the New York City Board of Education (“BOE”) a resounding defeat when it affirmed a District Court decision that allowed a class action brought by public school teachers regarding a mandatory certification test and rejected several of NYC’s defenses to the allegations of discrimination. The ruling is significant to both private and public employers.

Case Background

In Gulino v. Board of Education, No. 13-1001 (2d Cir. Feb. 4, 2014), a group of teachers brought a class action alleging that the BOE engaged in unlawful discrimination under Title VII by requiring public school teachers to pass certain examinations to obtain/retain a teaching position. Id. at 2. On appeal the BOE asked the Second Circuit to overturn the District Court opinion, which held that: (1) the BOE could be subject to Title VII liability for its use of the at issue required test – the Liberal Arts and Sciences Test, or “LAST” – and that LAST violated Title VII’s disparate impact provisions as it was not properly validated; (2) that Wal-Mart v. Dukes, 131 S.Ct. 2541 (2011), did not compel full decertification of the class; and (3) that the BOE’s defense grounded in the Supreme Court’s decision in Ricci v. DeStefano, 557 U.S. 557 (2009), does not apply to disparate impact claims. Id. at 2-3.

The Second Circuit’s Decision

The Second Circuit affirmed the District Court’s decision in all respects. First, the Second Circuit rejected the BOE’s argument that its use of a facially neutral state licensing requirement – LAST – shielded it from liability under Title VII. Id. at 3. In addition to finding that the BOE forfeited this argument by abandoning it in a previous appeal brought before the Second Circuit, it held that employers cannot “justify [its] policy by reliance on what it contends are the requirements of state law” as “Title VII explicitly relieves employers from any duty to observe a state hiring provision ‘which purport to require or permit’ any discriminatory employment practice.” Id. at 4-5.

With respect to the BOE’s contention that the District Court should have decertified the entire class based Wal-Mart v. Dukes, the Second Circuit deemed this dispute as moot since on August 29, 2013, the District Court granted the BOE the relief it sought – a determination of whether plaintiffs’ claim satisfies the predominance and superiority requirements of Rule 23(b)(3) – which it held it did when a remedy-phase class was certified. Id. at 6.

Finally, the Second Circuit rejected the BOE’s argument based on the “Ricci” defense. Id. In Ricci, the Supreme Court determined that the City of New Haven discriminated against a group of white firefighters when it scrapped the results of a promotional exam that had a disproportionately adverse impact on minorities. In evaluating the City of New Haven’s decision to disregard the test results, the Supreme Court held that in a race-based action, is a permissible defense to a disparate treatment claim under Title VII only if the employer can demonstrate a strong basis in evidence that, had it not taken the action, it would have been liable under a disparate impact claim. The Second Circuit rejected the BOE’s claim that Ricci also provided a defense to employers facing claims of disparate impact. Id.

Implications For Employers

This decision highlights the continued wide-ranging impact (as we recently discussed here and will be covered in our upcoming Annual Workplace Class Action Report Webinar on February 11, 2014, which our readers can register for here) – that Wal-Mart v. Dukes has on virtually all class actions pending in federal and state courts throughout the country. Additionally, the Second Circuit’s holding as to the unavailability of Ricci as a defense to disparate impact claims, although not surprising, is an important reminder for employers as to the reach of this 2009 Supreme Court decision.

By Paul Kehoe          

Amidst a nation characterized by rapidly changing demographics, the EEOC today held a public meeting to discuss national origin discrimination. We attended to get a front row seat for our loyal blog readers. The bottom line – employers should pay attention to this.

Commissioner Yang, in conjunction with Chair Berrien, led the effort to organize the meeting. The Commissioners heard testimony from advocates and management representatives alike to discuss the many challenges in today’s workplace related to national origin discrimination, including English-only policies, language fluency requirements, accents, occupational segregation, customer preference, and harassment. Chair Berrien structured the meeting differently than in the past, where all panelists sat together during the Commissioners’ question and answer period, which facilitated a more back and forth discussion amongst the panelists and Commissioners than in prior meetings.  

For different reasons, all who testified suggested some level of support for updated guidance from the EEOC. Employer representatives suggested clarifying certain aspects of the current EEOC guidance and providing best practices, while fully considering employers’ legitimate interests and Title VII’s statutory intent. Advocates for workers suggested providing additional guidance narrowing the permissible instances where English-only policies would be appropriate and addressing “listener” or “implicit” bias as it relates to customer preference and other issues.  

While it is unclear whether the EEOC will undertake to revise its national origin guidance issued in December 2002 following the September 11, 2001 attacks, generally speaking, an initial step to updating guidance is to hold a public hearing. Currently, the EEOC’s guidance recognizes that claims may be brought under both disparate treatment and disparate impact theories of discrimination. Of course, in a disparate treatment claim the plaintiff would bear the ultimate burden of establishing pretext, while in a disparate impact claim, the ultimate burden would fall on the employer to establish that the policy at issue was job-related and consistent with business necessity. Updated guidance would likely provide more context for the regulated community, but may ultimately make it more difficult for employers to comply with the EEOC’s view of Title VII. 

Will the EEOC choose to update guidance in this area, which by Commission standards was recently completed in 2002, when there are other more pressing guidance documents to update? Only time will tell, but employers should review their language-related policies to determine whether they are in compliance with Title VII or if the policy needs additional consideration. 

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

By Gerald L. Maatman Jr. and Howard M. Wexler

While the Federal Government is shut down for now, the EEOC is trying shut down courts ability to review its conciliation efforts for good. As we previously reported here, the EEOC has aggressively pursued this theory by attacking defendants’ failure-to-conciliate affirmative defenses in two recent district court cases in the Seventh Circuit — in EEOC v. Mach Mining, LLC, No. 11-CV-879-JPG-PMF, 2013 WL 319337 (S.D. Ill. Jan. 28, 2013), and EEOC v. St. Alexius Medical Center, No. 12-CV-7646, 2012 WL 6590625 (N.D. Ill. Dec. 18, 2012). On September 27, 2013, the EEOC filed its reply brief in EEOC v. Mach Mining urging the Seventh Circuit to  in support of its interlocutory challenge to a lower court’s ruling that the EEOC’s conciliation and investigation efforts are subject to at least some level of review.

Background Of EEOC v. Mach Mining

In EEOC v. Mach Mining, the EEOC alleged a pattern or practice of not hiring women for mining and related positions, or, in the alternative, maintaining a neutral hiring policy that has a disparate impact on women. The company asserted a number of affirmative defenses, including that the EEOC failed to conciliate in good faith. The EEOC moved for summary judgment on just that defense, arguing that the Seventh Circuit’s decision in EEOC v. Caterpillar, Inc., 409 F.3d 831 (7th Cir. 2005), compelled the conclusion that the EEOC’s conciliation process is not subject to judicial review. Mach Mining, 2013 WL 319337, at *1. While noting that the circuits were split on exactly what level of review was appropriate, the weight of circuit authority holds that the conciliation process is subject to at least some level of review. Mach Mining, 2013 WL 319337, at *3 (“[D]istrict courts within the Seventh Circuit, like all other courts to have considered the issue, have concluded that the EEOC’s conciliation process is subject to at least some level of review.”).

Subsequently, the district court granted the EEOC’s motion to certify the order to the Seventh Circuit pursuant to section 1292(b). EEOC v. Mach Mining, LLC, No. 11-CV-879-JPG-PMF, 2013 WL 2177770 (S.D. Ill. May 20, 2013). The district court certified two questions: (1) whether courts may review the EEOC’s informal efforts to secure a conciliation agreement acceptable to the EEOC before filing suit?; and (2) if courts may review the EEOC conciliation efforts, should the reviewing court apply a deferential or heightened scrutiny standard of review? Id. at *6.

EEOC’s Reply Brief

In its reply brief filed recently in the Seventh Circuit, the EEOC takes aim on employers now “routine tactic” of arguing in support of the “so-called failure to conciliate defense.” EEOC Reply Brief at 1. The EEOC argues that text of Title VII places conciliation solely within the its unfettered discretion and that if the court allows this defense to continue, “the result will be more litigation about conciliation and more victims of discrimination without remedies.” Id. at 2. Such a statement appears to be a direct attack on the recent decision we reported here in EEOC v. Bloomberg L.P., 07 Civ. 8383 (S.D.N.Y. Sept. 9, 2013), where Chief Judge Loretta Preska of the U.S. District Court of the Southern District of New York dismissed most all of the EEOC’s remaining claims of pregnancy discrimination against the employer, leaving many employees without recourse due to the EEOC’s, “shirking its pre-litigation investigation responsibilities.”

Arguing that it is a distinction without a difference, the EEOC’s Seventh Circuit brief challenges the contention while the its decision that conciliation has failed is not reviewable, its activities during the conciliation process itself should be subject to judicial review. Id. at 3. Instead, the EEOC argues that the entire conciliation process is within its exclusive purview based on “its experienced judgment” and that the EEOC alone should be “empowered to make that call.” Id. at 4. As such, the EEOC argues its pre-suit conciliation activities cannot be challenged since “…at the conciliation stage, the statute [Title VII] makes clear that the EEOC’s ‘word’ does govern.”  Id. at 17. Therefore, the EEOC contends that “Courts should not, however, look behind the conclusion that conciliation has failed and review the underlying process.” Id. at 22. In conclusion, the EEOC argues that:

To be sure, other federal courts have reviewed the EEOC conciliation process, but those decisions are at odds with firmly established administrative law principles. Outside of the EEOC conciliation context, one is hard-pressed to find instances where courts recognize that the substantive agency decision is committed to the agency’s discretion yet the agency’s underlying process in reaching that decision is substantively reviewed.

Id. at 25.

Implications For Employers

These are important questions that could dramatically alter the balance of power for employers entering the conciliation process with the EEOC. Employers suffer specific and often dramatic reputational harm the instant the EEOC files suit. As we have previously reported here and here, federal courts around the country have recently taken the EEOC to task for its “shoot first, aim later” litigation tactics. If the EEOC’s position wins the day – and its pre-suit activities are immune from challenge – then it will be able to force its will on employers without any meaningful recourse to determine whether the EEOC’s conciliation efforts were made in good faith. Stay tuned!

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

By Gerald L. Maatman, Jr. and Howard M. Wexler

With the recent recognition by the American Medical Association that obesity is a disease (and not just a medical condition), courts around the country have begun to formulate their position as to whether (and to what extent) obesity is covered under the Americans With Disabilities Act. The EEOC’s regulations state that while body weight within a “normal” range is not generally considered an impairment, body weight that falls outside a normal range, whether above or below, or body weight that is the result of a physiological disorder, can be an impairment under the law. In a recent interview, EEOC Commissioner Chai Feldblum stated that as of September 2013, the EEOC has brought two lawsuits involving morbid obesity as a disability since the passage of the ADA Amendments Act (“ADAAA”).

While courts are continuing to develop a body of law regarding the protections afforded to obese individuals under the ADAAA (as well as parallel state laws), a recent decision by Judge Thomas L. Ludington of the U.S. District Court for the Eastern District of Michigan in Ayers, et al. v. Multibrand Field Services Inc., Case No. 13-CV- 10765 (E.D. Mich. Sept. 18, 2013), sheds some light on what types of claims will not be recognized.


The employer, Multibrand (a satellite dish installation company) had a policy that it does not hire anyone who weighs over 250 pounds. Id. at 1. The reason for this policy is because Multibrand’s employees must carry equipment with them that weighs approximately 50 pounds, and the ladders that these employees must climb can only support up to 300 pounds. Id. Ayers applied for a job, disclosed that he weighed over 250 pounds, and did not get the job as a result. Id. at 2. Ayers subsequently filed a lawsuit (that Multibrand removed to federal court) alleging that Multibrand’s 250 pound weight restriction policy is discriminatory under Michigan’s Elliot-Larson Civil Rights Act – which expressly prohibits employers from discriminating against individuals based on their weight. Id.

Ayers then filed an amended complaint, alleging that Multibrand’s weight policy had a disparate impact against overweight individuals. Id. at 2-3. This claim is the type of standard class-wide claim often asserted in workplace class actions.

Multibrand immediately moved to dismiss the disparate impact claim since Ayers failed to allege any facially neutral policy or practice – a requirement for any cognizable disparate impact claim. Id. at 3. Judge Ludington agreed with Multibrand’s argument and summarily dismissed Ayers’ disparate impact claim. In dismissing this claim, Judge Ludington rejected Ayers’ argument and held that “that a claim for disparate impact requires a facially neutral policy has been affirmed by the Supreme Court on multiple occasions.” Id. at 5. Here, since Multibrand’s policy is not facially neutral as it unequivocally prevents anyone who weighs over 250 pounds from being hired – Judge Ludington found that Ayers’ disparate impact claim must be dismissed. Id. at 8.

Judge Ludington did not stop there. Rather, believing that “Ayers’s counsel should have known the [disparate impact] claim was frivolous…sanctions pursuant to 28 U.S.C. § 1927 are warranted.” Id. at 10. Therefore, Judge Ludington gave Multibrand leave to submit supplemental briefing as “Multibrand incurred additional expenses in moving to dismiss the frivolous claim, and those expenses will be shouldered by Ayers’s counsel personally. Id. at 11.

Implications For Employers

Judge Ludington’s finding – that a facially neutral policy is required to support a disparate impact claim – is something that employers have long understood. However, given Congress’s admonitions in the ADAAA that “substantially limiting” and “disability” are to be broadly construed, many obese (and some overweight but not obese) employees are undoubtedly now actually disabled under the ADAAA. Additionally, employers should be mindful that under the ADAAA’s “regarded as” prong, employees are only required to show that the employer took an action because of its belief regarding the employee’s impairment and do not have to show an impairment that substantially limits a major life activity. As such, while not surprising, the Ayersdecision represents just the beginning of a growing body of law in this area. Stay tuned…

By Gerald L. Maatman Jr. and Howard M. Wexler

We previously blogged about the scathing letter sent by the chief legal officers representing the states of Alabama, Colorado, Georgia, Kansas, Montana, Nebraska, South Carolina, Utah and West Virginia to the five Commissioners of the U.S. Equal Employment Opportunity Commission (“EEOC”) blasting the EEOC on its position that “employers’ use of bright-line criminal background checks in the hiring process violates Title VII…” and urging the EEOC to reconsider its ‘Enforcement Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions Under Title VII of the Civil Rights Act of 1964’ approved in April 2012.

Although it took some time to do so, the EEOC finally broke its “cone of silence” and responded to the harsh criticism levied against it by these nine Attorneys General. By letter dated August 29, 2013 the Chair of the EEOC, Jacqueline A. Berrien, wrote a responsive letter stating that the updated guidance merely “clarifies and updates the EEOC’s longstanding policy in this area” and discussed some of the issues raised by these nine chief legal officers regarding the harmful effects and overall uncertainty that the EEOC’s litigation tactics in this area have caused.

EEOC’s Response To The AG’s July 24 Letter

Responding to the Attorneys’ General criticism of the EEOC’s application of disparate impact analysis to the use of criminal history screens, Chair Berrien wrote as follows:

At the outset, I want to make clear that it is not illegal for employers to conduct or use the results of criminal background checks, and the EEOC never has suggested that it is. The EEOC’s mission is to prevent and remedy employment discrimination prohibited under federal law. Applying disparate impact analysis to criminal background checks is squarely within this mission…


Your primary objection to the substance of the Enforcement Guidance relates to its discussion of individualized assessments. But this objection appears to be premised on a misunderstanding: that the Guidance urges employers “to use individualized assessments rather than bright-line screens.” This is incorrect. The Guidance does not urge or require individualized assessments of all applicants and employees.

Instead, the Guidance encourages a two-step process, with individualized assessment as the second step. First, the Guidance calls for employers to use a “targeted” screen of criminal records. A “targeted” screen considers “at least the nature of the crime, the time elapsed, and the nature of the job. Once the targeted screen has been administered, the Guidance encourages employers to provide opportunities for individualized assessment for those people who are screened out. Using individualized assessment in this manner provides a way for employers to ensure that they are not mistakenly screening out qualified applicants or employees based on incorrect, incomplete, or irrelevant information, and for individuals to correct errors in their records. The Guidance’s support for individualized assessment only for those who are identified by the targeted screen also means that individualized assessments should not result in “significant costs” for businesses.

Furthermore, as your letter acknowledges, the Guidance explains that an employer may decide never to conduct an individualized assessment if it can demonstrate that its targeted screen is always job related and consistent with business necessity:

As such, the EEOC’s “response” arguably repackages the very same guidance that these Attorneys General complained about in their July 24 letter. Additionally, the EEOC’s response fails to address several of the key points raised in the AGs’ letter, including the fact that carrying out the “individualized assessment” proposed by the EEOC could be financially ruinous for employers as well as the fact that by prosecuting employers for use of race-neutral criminal background screens, the EEOC has improperly taken on a role that is assigned to Congress under the Constitution.

Finally, in response to the Attorneys General complaints about two of the more recent disparate impact lawsuits filed by the EEOC regarding the use of criminal background checks against Dollar General and BMW Manufacturing Co. LLC, the EEOC merely responded that, “The merits of these cases will be determined in court.”

In sum, the EEOC’s response can be summarized as follows – Our guidance is lawful, abide by it.

Implications For Employers

As we have blogged about frequently, the EEOC has been hit hard by judges from across the country in several of its high-profile disparate impact lawsuits regarding the use of criminal background screens, including EEOC v. Freeman (discussed here) and EEOC v. Kaplan Higher Education Corp. (discussed here).

While employers continue to face the unenviable task of deciding whether to screen for applicants’ criminal histories and face the risk of an EEOC enforcement action or whether to hire individuals with criminal backgrounds and face civil lawsuits alleging, for example, negligent hiring claims, the backlash against the EEOC’s decision to bring these types of lawsuits continues to mount. The EEOC’s cursory respond to the Attorneys General July 24 letter will most certainly only add more fuel to the fire, especially as judges continue to issue opinions like those issued in EEOC v. Freeman and EEOC v. Kaplan criticizing the EEOC’s “do as we say, not as we do” tactics (given that the EEOC itself conducts criminal background investigations as a condition of employment for all positions, and conducts credit background checks on approximately 90 percent of its positions). 

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

By Laura J. Maechtlen and Brian Wong

 As the EEOC trains its focus on systemic enforcement actions, discovery battles over probative claimant information will continue to grow in importance proportionally with the claimant class size. Employer access to specific types of claimant information can make a critical difference in mounting key defenses, testing claimant credibility, and limiting available damages. The EEOC, however, does not hand over such information without a fight.

Recently, in EEOC v. Signal Int’l, LLC, Case No. 12-557 (E.D. La. Sept. 10, 2013), Judge Daniel Knowles of the U.S. District Court in the Eastern District of Louisiana refereed a two-on-one brawl among the EEOC, claimant interveners and the defendant employer over the propriety of discovery into claimant immigration history and status.

In this case, the EEOC asserted four Title VII claims against the employer, including: (1) a §703(a) violation for creation and perpetuation of a hostile work environment; (2) a § 703(a) disparate treatment claim for alleged imposition of less favorable terms and conditions of employment on employees of Indian descent; (3) retaliation claims; and (4) a § 706 pattern or practice claim for both hostile work environment and disparate treatment. Concurrently, individual claimants brought a separate action against Signal, entitled David v. Signal Int’l, LLC, Case No. 08-1220 (E.D. La.). As is common in EEOC enforcement actions, the David plaintiffs also intervened in the EEOC’s action against Signal. You can read our analysis of prior developments in these companion cases here.

After filing dueling motions for protective orders, the parties briefed the issue of whether Signal should receive access in discovery to claimants’ immigration-related documents, including claimants’ T-visa applications. Signal maintained that discovery into claimants’ immigration-related documents was necessary for it to test each claimant’s motive, bias, and credibility.

Despite acknowledging Signal’s interest in the information at issue, Judge Knowles held that (i) the claimants’ current immigration status was a “collateral issue” in the case; and (ii) allowing discovery of records relating to immigration history and status had a chilling or in terrorem effect on claimants and placed an undue burden on private enforcement of employment discrimination laws sufficient to outweigh the probative value of the information. Id. at 12. Notably, in arriving at this conclusion, Judge Knowles relied on a litany of similarly-reasoned Ninth Circuit cases. Id. at 9-10.

As a consolation, Judge Knowles did grant Signal’s request to restrict the EEOC from improperly disseminating information it secured from Signal through pre-trial discovery. Id. at 13. After being “lambaste[d]” on Dan Rather Reports by its adversaries in the case, Signal sought judicial intervention to prohibit the EEOC from improper use of evidence secured through pre-trial discovery. Id. at 5. Judge Knowles agreed with Signal’s position, notwithstanding the EEOC’s invocation of the Freedom Of Information Act, which the Court considered inapposite. Id. at 14.

Implications For Employers

 EEOC v. Signal Int’l, LLC serves as a reminder to employers that courts are not adverse to place substantial limits on discovery of any information that could deter claimants from participating in Title VII litigation. Nonetheless, aggressive pursuit of relevant claimant information is critical to defending against systemic enforcement actions, and despite the relevance of some information, the EEOC will often take unreasonable and aggressive positions in seeking “protection” from its disclosure. Notably, the fight on immigration related information is not new.

The EEOC routinely trots out the same legal authority relied on in Signal in many of its litigation cases — including cases where immigration status is directly at issue — in an attempt to argue it is never discoverable.  However, in many instances, the case law precedent is distinguishable because immigration status is a relevant issue to the case, or immigration status is relevant to damages in an employment discrimination action.  Indeed, various cases have found that immigration status is relevant. See EEOC. v. Evans Fruit Co., Inc., Case No. 10-CV-3033, 2011 WL 2471749, at *1 (E.D. Wash. June 21, 2011) (“[T]he court concludes immigration status does have potential relevance to emotional distress damages . . . That said, because immigration status has potential relevance to damages, it is a legitimate area of discovery and the court will allow the same, subject to an appropriate protective order which ensures the information obtained remains confidential.”); Aguilar v. Immigration and Customs Enforcement Div., No. 07-Civ-8224, 2009 WL 1789336, at *4 (S.D.N.Y. June 23, 2009) (“[T]he immigration status of the named Plaintiffs and putative class members may be relevant to their allegations of emotional and mental distress . . .”); EEOC v. First Wireless Group, Inc., No. 03-CV-4990, 2007 WL 586720, at *9 (E.D.N.Y. Feb. 20, 2007) (noting discovery of immigration status may be relevant to damages in an employment discrimination action).

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

By Rebecca Bjork and Gerald L. Maatman, Jr.

Workplace class actions are being reshaped before our very eyes, as district courts across the country apply important new Supreme Court decisions. A new noteworthy ruling illustrating this trend in the context of Rule 23(b)(3) requirements is from a long-running employment discrimination case in New York entitled Gulino, et al. v. The Bd. of Educ. of the City Sch. Dist. of the City of N.Y., No. 96 CV 8414, 2013 U.S. Dist. LEXIS 123948 (S.D.N.Y. Aug. 29, 2013). You can read it here. Judge Kimba M. Wood of the U.S. District Court for the Southern District of New York granted plaintiffs’ motion to certify a class under that Rule 23(b)(3) and embraced their proposal for a two-stage remedial phase, even though some aspects of those proceedings will necessarily require consideration of some individualized evidence. As such, it represents a “work-around” that plaintiffs’ class action counsel have sought since the U.S. Supreme Court’s employer-friendly rulings in Wal-Mart Stores, Inc. v. Dukes, 131 S.Ct. 2541 (2011), and Comcast Corp. v. Behrend, 133 S.Ct. 1426 (2013).

Ultimately, though, we think the unique nature of the ruling in Gulino leaves plenty of room for employers facing newly-filed class actions to argue it should not carry much persuasive weight.

Background Of The Case

Briefly, the lawsuit alleges that the School Board discriminated against New York City public school teachers by requiring them in the early 1990’s to pass a licensing exam that had a disparate impact on minorities. Id. at *3-4. Thousands of them failed, and in response, according to a judgment reached after an earlier eight week bench trial, “the Board retained them in the same teaching positions and assigned the same course load, but revoked their licenses, demoted them to substitute teachers, reduced their salaries, froze their pensions, and revoked their seniority rights.” Id. at *5 (citing Gulino v. Bd. Of Educ. Of the City Sch. Dist. of City of N.Y., 201 F.R.D. 326, 329 (S.D.N.Y. 2001)). 

Initially, the previous judge assigned to the litigation had certified a class under Rules 23(a)’s commonality requirement and Rule 23(b)(2)’s injunctive class procedure. But after the Supreme Court’s decision in Wal-Mart Stores, Inc., which held that individual monetary relief cannot be awarded on a class-wide basis through a Rule 23(b)(2) injunction, the class was partially decertified on that issue. Gulino, 2013 U.S. Dist. LEXIS 123948, at *8. The latest development is that now Judge Wood has granted the plaintiffs’ proposal to certify a remedial class, to be tried in two phases, under Rule 23(b)(3) instead. 

The Basis Of The Ruling

Rule 23(b)(3)’s predominance requirement, which the Supreme Court has explained is even more demanding than commonality, “tests whether proposed classes are sufficiently cohesive to warrant adjudication by representation.” Id. at *30 (quoting Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 623 (1997). Despite the higher standard, the Court in Gulino found that certifying a damages class under Rule 23(b)(3) would be “the superior method of adjudicating Plaintiffs’ remaining claims.” Id. at *37. 

For the remedial phase, “the Court agree[s] with Plaintiffs that the class shares common questions (and answers) relating to the calculation of appropriate remedies” and that the first stage “will address class-wide issues, including calculation of back pay, pension benefits, and seniority; the second stage will address individual issues, including mitigation and the amount of back pay to which each claimant is entitled.” Id. at *19. The Court embraced the use of salary tables and cohorts (based on what year the teachers would have been eligible for full-time teaching) to calculate back pay on  periodic basis. Id. at *20-21. At the second stage, the Board “will have an opportunity to present other, non-discriminatory reasons why a class member would not have received” a license or regular teaching assignment. Id. at *22. This outcome may seem surprising given that the Supreme Court’s ruling in Comcast Corp. v. Behrend requires plaintiffs to propose a model capable of calculating individual damages on a class-wide basis at the class certification stage. There, the majority stated, “respondents cannot show Rule 23(b)(3) predominance: Questions of individual damage calculations will inevitably overwhelm questions common to the class.” Id. at 2560.  

Implications For Employers

The decision in Gulino is one of the first employment discrimination class actions to certify phase two damages issues under Rule 23(b)(3). Its reasoning to get to that result is somewhat strained and convoluted. In many respects, the decision reflects the historical tendency to favor class actions in case law in the Second Circuit. For example, the Court explained that plaintiffs “have identified more than 1,000 individuals who have been harmed” by the use of the test, and requiring them to file individual lawsuits “would sacrifice the efficiencies that could be obtained by resolving common issues together and using those determinations to streamline individual proceedings.” Id. However, the procedural posture of the litigation appears to have been a crucial determining factor, for “[c]lass members have been relying on this litigation proceeding as a class action for more than seventeen years” and “forcing members to initiate separate actions at this late stage would be unfair.” Id. at *37-38. Proceedings for damages determinations “will expedite compensating Plaintiffs” who, “despite clear evidence of the [School] Board’s liability, . . . “have yet to obtain any relief.” Id. at 838. As a result, employers have a sound basis to blunt the impact of this plaintiff-friendly predominance decision in cases where facts regarding liability are still in dispute.


By Gerald L. Maatman Jr. and Howard M. Wexler

On August 30, 2013, Judge Nicholas G. Garaufis of the U.S. District Court of the Eastern District of New York awarded interim attorneys’ fees and costs totaling $3,707,313.29 to Plaintiffs who intervened in the matter of United States v. The City of New York, No. 07-CV-2067 (E.D.N.Y. Aug. 30, 2013). Although the total amount of interim fees and costs awarded by Judge Garaufis is substantially less than the $7,710.542.00 requested, it nonetheless represents a substantial payday for the attorneys litigating this case that New York City will have to pay in connection with this six-plus year hard fought and highly controversial case that is still ongoing.

As such, the ruling illustrates the heightened exposure employers face in high-stakes workplace class actions.

Background Of The Case

As we previously blogged here and here, the United States originally filed this lawsuit against the City in 2007, alleging that the City’s entry-level firefighter exams and applicant ranking had an unlawful disparate impact on African-American and Hispanic applicants. Id. at 2. The Vulcan Society and several individuals intervened in the lawsuit (“Plaintiff-Intervenors”), alleging similar claims of disparate impact and also alleging disparate treatment on behalf of a putative class of African-American, entry firefighter candidates. Id. The Court agreed with Plaintiffs, finding that the City’s procedures for screening and selecting entry-level firefighters violated Title VII, the Equal Protection Clause, and the Civil Rights Act of 1866, along with New York state and local law. Id. at 2-3. Consequently, the Court issued an order requiring the City to develop a non-discriminatory test for entry-level firefighter applicants. Id. Earlier this year, the Second Circuit vacated the grant of summary judgment for disparate treatment liability, but upheld the injunctive relief order. Id. at 4. After the Second Circuit’s decision, the Plaintiff-Intervenors filed requesting Judge Garaufis award them interim attorneys’ fees and costs given that the relief they sought was largely upheld. Id. at 5.

The Basis Of The Fee Ruling

Judge Garaufis agreed with Plaintiff-Intervenors, finding that they were entitled to recover interim attorneys’ fees and costs given that they were “undoubtedly the prevailing party” given the Second Circuit’s decision, as well as those aspects of his decision that the City did not appeal, including summary judgment on disparate impact. Id. at 18. However, Judge Garaufis discounted the attorneys’ fees and costs requested by Plaintiff-Intervenors based on several factors, including the fact that Plaintiff-Intervenors requested attorney fee rates consistent with those provided for in the Southern District of New York rather than the Eastern District of New York (where the lawsuit was brought) as the Plaintiff-Intervenors failed to establish, as they must to recover out-of-district rates that, “in district counsel [within the EDNY] were unable or unwilling to take this case.” Id. at 10.

Upon deciding on the rate(s) that he would award for each attorney who worked on the case, Judge Garaufis made a 40% across-the-board reduction of Plaintiff-Intervenors’ requested hours broken down as follows: a 25% reduction for claims upon which Plaintiff-Intervenors are not the prevailing party (e.g., individual claims brought against Mayor Bloomberg);  a 10% reduction for duplicative efforts with the United States; and a 5% reduction for overstaffing totaling an attorneys’ fee award of $3,556,609.20. Id. at 21. According to Judge Garaufis, “this award accounts for the appropriate reductions in the explained areas but ultimately reflects the extraordinary effort that was necessary to effect change of the magnitude and importance involved in this litigation.” Id. Judge Garaufis further granted the Plaintiff-Intervenors $150,704.09 in interim costs for items such as electronic research costs, meals and travel with leave to additional documentation as to their request to recoup certain expert and consultant fees. Id. at 28-29.

Implications For Employers

Given that a bench trial on the disparate treatment aspect of the case is yet to come (which Judge Garaufis will not preside over based on the Second Circuit’s decision) the meter is still running on how much the employer will have to pay in attorneys’ fees and costs in this case, which will be on top of both the monetary and non-monetary relief Plaintiffs recover. Cases such as this serve as a reminder that multi-million dollar attorneys’ fee awards in class action cases such as this are not unusual. Those who litigate them – including the attorneys in this case – can easily spend thousands of hours engaged in discovery, motion practice, pre-trial preparation, and more.