Category: EEOC Litigation

By Gerald L. Maatman, Jr., Brittany M. Wunderlich, and Christian J. Palacios

Duane Morris Takeaways:  In EEOC v. Drivers Management, LLC et al., Case No. 8:18-CV-462 (D. Neb. Jan. 10, 2024), U.S. District Judge John M. Gerrard rejected the EEOC’s proposed injunctive relief — ordering the company to comply with the Americans with Disabilities Act (the “ADA”) — and instead ordered defendants to report to the EEOC all job applications it receives from deaf truck drivers and whether the applicants are hired, among other information, on a semi-annual basis over a three-year period.  This case illustrates how federal judges may use their discretion to fashion case-specific injunctive relief designed to prevent similar discrimination in the future.

Background

Victor Robinson, a deaf commercial truck driver, applied to work for Drivers Management, LLC and Werner Enterprises, Inc. (collectively, “Werner”) in January of 2016.  He was denied employment, despite having a commercial driver’s license and an exemption for his hearing disability from the Federal Motor Carrier Safety Administration (the “FMCSA”), the federal agency responsible for regulating and providing safety oversight to commercial motor vehicles.  The EEOC subsequently brought an enforcement lawsuit on the grounds that Werner discriminated against Robinson on the basis of his deafness.

The Jury Trial

Werner claimed that it rejected Robinson’s application for employment because it could not train inexperienced deaf drivers, like Robinson.  Despite the federal government’s approval and despite evidence that other trucking companies were able to train deaf drivers, Werner argued that Robinson, and other FMCSA hearing exemption holders, could not complete Werner’s training program, which required drivers with less than 6 months of experience to drive alongside a trainer on a real over-the-road trucking route, due to safety concerns.  Id. at 2.

In September 2023, the jury returned a verdict in favor of the EEOC after a trial. The jury rejected Werner’s position finding that Robison was qualified and could have performed the essential functions of the job, if provided with a reasonable accommodation.  Id. at 3.  The jury also determined that Werner acted with malice or reckless indifference towards Robinson’s right not to be discriminated against on the basis of his deafness, and awarded substantial damages intended to punish Werner for its misconduct.  Id.

The Court’s Order

In the Court’s Order, Judge Gerrard considered whether the EEOC’s requested injunctive relief was sufficient. In doing so, the Court concluded that the EEOC’s request for an order that the defendants to end their discriminatory practices, provide reasonable accommodations to workers, and train employees on the ADA, did little more than “order Werner to obey the law.”  Id. at 11.  Rather, the Court observed, “the scope of injunctive relief against continued discrimination should be designed to prevent similar misconduct, and must be related to the violation with which the defendants were originally charged.”  Id.  Accordingly, the Court imposed semi-annual recording and reporting requirements on Werner (and its subsidiaries), requiring that they keep records of every hearing-impaired applicant that applied for an over-the-road truck driving position, the date of the application, whether the applicant was hired, when the employment decision was communicated to the applicant, the basis for declining to hire the applicant, and whether the applicant remained employed with Werner for six months and, if not, the reason for the separation.  The reporting obligation was imposed for a term of three years, after which the Court would convene a hearing to determine whether Werner complied with the order, and whether the injunction should be modified, extended, or terminated.

Implications For Employers

As this decision illustrates, federal judges have a wide degree of discretion to modify the relief sought by the EEOC, specifically with respect to injunctive relief. If a judge does not believe that the requested injunctive relief effectively prevents future discriminatory conduct, that judge is free to require the defendant employer comply with additional requirements, up-to and including mandatory reporting obligations to the EEOC.

By Gerald L. Maatman, Jr., Emilee N. Crowther, and Christian J. Palacios

Duane Morris Takeaways:  In EEOC v. U.S. Drug Mart, Inc., No. 23-50075, 2024 WL 64766, at *1 (5th Cir. Jan 5, 2024), the Fifth Circuit refused to resurrect an EEOC lawsuit alleging that a Texas pharmacy created a hostile work environment under the Americans with Disabilities Act (the “ADA”) by reprimanding an asthmatic employee for wearing a mask during the beginning of the COVID-19 pandemic.  This case illustrates the Fifth Circuit’s high evidentiary standards associated with establishing the existence of a hostile work environment, especially with regards to demonstrating that the conduct was “sufficiently severe or pervasive to alter the conditions of the victim’s employment.”  Id.

Background

The charging party, David Calzada, was a pharmacy technician at U.S. Drug Mart (d/b/a Fabens Pharmacy).  Id.  Mr. Calzada suffered from asthma, and elected to wear a face mask to work on March 26, 2020. Id.  However, after arrival, the store manager informed Mr. Calzada that mask-wearing violated the pharmacy’s policy, and instead of removing his mask, Mr. Calzada left for the day.  Id.  A few days later, when Mr. Calzada returned to work, his supervisors informed him that the pharmacy’s polices were updated and he was now permitted to wear a mask and gloves at work.  Id.  However, during the meeting, Mr. Calzada was repeatedly belittled by the head pharmacist and at one point called a “disrespectful stupid little kid.”  Id.  Mr. Calzada quit the same day. Id.

Mr. Calzada subsequently filed a charge of discrimination with the EEOC.  Id.  The EEOC brought suit against U.S. Drug Mart on his behalf, alleging the Texas pharmacy created a hostile work environment and constructively discharged Calzada based on the conduct of the store manager and head pharmacist.  Id.  The district court granted summary judgment in favor of U.S. Drug Mart in October of 2022. It determined that “an isolated instance of verbal harassment is generally not sufficient to support a hostile work environment claim.” EEOC v. United States Drug Mart, Inc., No. EP-21-CV-00232, 2022 WL 18539781, at *8 (W.D.Tex. 2022). The EEOC appealed on January 31, 2023.

The Fifth Circuit’s Ruling

The Fifth Circuit, in affirming the district court’s summary judgment decision, held that the EEOC was unable to establish a prima facie case for a hostile work environment claim because it was unable to prove that the head pharmacist’s harsh words were “sufficiently severe or pervasive to alter the conditions of the victim’s employment.”  EEOC, 2024 WL 64766, at *2.  The Fifth Circuit observed that although the head pharmacist’s behavior was “certainly brusque,” it fell well short of the Fifth Circuit’s fairly high standard for “severe” conduct.  Id.  The Fifth Circuit noted that the EEOC’s constructive discharge claim failed for the same reason, because proving constructive discharge required an even “greater degree of harassment than that required by a hostile work environment claim.”  Id.  Accordingly, the Fifth Circuit affirmed the district court’s grant of summary judgment in favor of the employer.

Implications For Employers

The COVID-19 pandemic was accompanied by a variety of novel legal theories and questions of first impression. One thing that remains the same, however, is the high evidentiary standard that plaintiffs need to satisfy to prove their hostile work environment claims, specifically with respect to the element of “severe and pervasive” conduct.

By Gerald L. Maatman, Jr., Emilee N. Crowther, and Christian J. Palacios

Duane Morris Takeaways: In EEOC v. 1901 South Lamar, LLC, No. 1:23-CV-539, 2024 WL 41202, at *1 (W.D. Tex. Jan. 3, 2024), U.S. District Judge Robert Pitman adopted U.S. Magistrate Judge Susan Hightower’s recommendation to deny Defendants’ three Motions to Dismiss an EEOC pregnancy discrimination lawsuit. As Magistrate Judge Hightower’s recommendation illustrates, even smaller entities that would ordinarily not satisfy Title VII’s numerosity requirement cannot escape the EEOC’s grasp if they collectively operate as a single, integrated enterprise. 

Case Background

Defendants 1901 South Lamar, LLC d/b/a Corner Bar (“Corner Bar”), Revelry Kitchen & Bar, LLC (“RK&B”), and Revelry on the Boulevard, LLC (“ROTB”) (collectively, “Defendants”) hired Kellie Connolly (“Connolly”) in September 2020 to work at the Corner Bar in Austin, Texas.  Id. at *1. On January 31, 2021, Connolly informed the Defendants she was pregnant.  Id.  Two months later, after Connolly became visibly pregnant, the Defendants allegedly reduced her work hours.  Id.  On June 25, 2021, Connolly’s manager terminated her employment, stating that “she was becoming ‘too much of a liability’” and that they would part ways “until after the baby.”  Id.

The EEOC filed suit against the Defendants alleging they discriminated against Connolly on the basis of her pregnancy in violation of Title VII.  Id. In seeking to dismiss the lawsuit, the Defendants argued: (i) Corner Bar was not an “employer” under Title VII because it employed fewer than 15 employees during the relevant time period, and (ii) the Defendants were not an integrated single employer enterprise under Title VII.  Id. at *2.

The Court’s Decision

Magistrate Judge Hightower was unpersuaded by the Defendant’s arguments. As a preliminary matter, Magistrate Judge Hightower held that Title VII’s numerosity requirement was not jurisdictional, and could therefore not serve to support Defendant’s Motion to Dismiss for lack of subject- matter jurisdiction.

The Magistrate Judge then applied a four-factor test to determine whether these separate entities were a “single, integrated enterprise” under Title VII and concluded that the factors weighed in favor of the EEOC.  In particular, the Court found the following facts supported the EEOC’s “integrated business enterprise” allegations: (i) Defendants all shared bartending staff and inventory, (ii) utilized a single Director of Operations to handle all human-resources related services, (iii) jointly marketed their businesses, and (iv) utilized a disciplinary form that bore the logo of each of the Defendants.  Id. at *3.  Accordingly, the Magistrate Judge found that these facts could support a finding of centralized control of labor relations and recommended the District Court deny Defendants’ Motion to Dismiss. Id. at *4.

The Defendants challenged the order by way of Rule 72 objections. On January 3, 2024, District Court Judge Robert Pitman rejected the Rule 72 objections, and accepted and adopted the Magistrate Judge’s report and recommendation.

Implications For Companies

As the ruling in EEOC v. 1901 South Lamar, LLC, illustrates, even employers with fewer than 15 employees that would ordinarily be exempt from Title VII’s requirements may be sued by the EEOC, provided they have sufficiently integrated affiliates that would collectively put them over Title VII’s numerosity threshold.

By Gerald L. Maatman, Jr. and Christian J. Palacios

Duane Morris Takeaways:  In EEOC v. Princess Martha, LLC, et al., Case No. 8:22-CV-2182, 2023 U.S. Dist. LEXIS 219651 (M.D. Fla. Dec. 11, 2023), Judge Charlene Honeywell of the U.S. District Court for the Middle District of Florida ruled that a real estate acquisition firm could not avoid a disability discrimination suit filed by the EEOC, despite the fact that the real estate firm was not named in the original charge of discrimination. The EEOC initially only sent two of the three defendants the operative charge of discrimination, but throughout the course of the investigation the Commission discovered that the real estate acquisition firm was a joint employer, and subsequently sent the real estate firm notice and amended its complaint accordingly. This case illustrates the dangers of joint employer liability for highly integrated corporate entities, and the judicial latitude the EEOC is often afforded to amend its complaints after charging a named party.

Background

In August of 2021, a woman was offered a job at Princess Martha, a Florida retirement community, but her job offer was rescinded after she failed a drug test on account of the medications she took to treat her Post Traumatic Stress Disorder. She promptly filed a charge of discrimination with the EEOC alleging Princess Martha’s hiring practices violated the Americans with Disabilities Act of 1990.

The EEOC sent Princess Martha notice of the charge on November 23, 2021. During the course of its investigation the Commission determined that Princess Martha had a joint employer relationship with TJM Properties, whom it sent notice to on May 26, 2022. After determining that TJM Properties and Princess Martha violated the ADA, and after an unsuccessful conciliation attempt, the EEOC filed a lawsuit against both TJM Properties and Princess Martha on September 21, 2022. The Commission subsequently amended its complaint by adding TJM Property Management to the suit, alleging TJM Property Management received proper notice of the lawsuit because of its interrelated relationship as a single or integrated enterprise and/or joint employer status with the other defendants.

TJM Properties and TJM Property Management moved to dismiss the lawsuit on two grounds: First they argued that the EEOC had failed to exhaust its administrative remedies, including adequately putting the TJM entities on notice and giving them the opportunity to conciliate. Second, they argued that the EEOC’s complaint failed to establish a single/integrated enterprise or joint employer relationship existed between the TJM entities and Princess Martha.

The Court’s Ruling

In ruling in favor of the EEOC, the Court made short work of the defendants’ first argument. TJM Properties participated in the conciliation process and was explicitly notified by the Commission that it was a joint employer to Princess Martha. TJM Property Management similarly received notice due to its interrelated nature with the other defendants, and the TJM entities shared a principal place of business and the same mailing address. Furthermore, the Court pointed to an agreement existed between the defendants that required TJM Property Management to assist in coordinating legal matters with Princess Martha.

With respect to the defendants’ second argument, the Court noted that typically only parties named in EEOC charges could be charged in suits, but courts used a five-factor test to determine whether a non-named party could be sued. Applying the factors to the case, the Court determined that all three defendants were “highly integrated.” Id. at * 8. All three entities shared a mailing address, and the managing members of Princess Martha were also active in the management of TJM. Additionally, the human resources director for Princess Martha was a TJM Properties employee, and all three entities shared a common owner. Because of this, the Court concluded that despite the fact that the EEOC had not named TJM Property Management in the original suit, the highly integrated nature of the defendants made the Commission’s amended complaint appropriate.

Implications For Employers

As the ruling in EEOC v. Princess Martha, LLC illustrates, many courts are reluctant to strictly interpret an EEOC complaint, and the Commission can likely amend its lawsuit if, during the course of its investigation, it discovers that named defendants have highly integrated relationships with non-named entities. Therefore, companies with closely adjacent corporate affiliates should take extra care if they receive a charge of discrimination from the EEOC, as the Commission may later amend its complaint to include a non-named corporate entity.

By Gerald J. Maatman, Jr., Alex W. Karasik, and Derek Franklin

Duane Morris Takeaways:  On September 29, 2023, the EEOC issued a new Proposed Enforcement Guidance on Harassment in the Workplace (the “Guidance”).  The Guidance provides insights into how employers can handle evolving workplace realities and developing trends with harassment claims. Notably, the Guidance addresses how digital technology and social media postings can contribute to a hostile work environment.  It also addresses the U.S. Supreme Court’s 2020 landmark decision in Bostock v. Clayton County, where Supreme Court held that discrimination based on sexual orientation or gender identity constitutes sex-based discrimination under Title VII of the Civil Rights Act of 1964 (“Title VII”).  The Guidance is open to public comment through November 1, 2023; if issued in final form, it will mark the first update to the EEOC’s official harassment guidance in nearly 25 years.

For employers, the Guidance is a “must read” in terms of preventing future workplace harassment claims.

Workplace Harassment In The Digital Landscape

The Guidance spotlights how social media postings and other online content can contribute to hostile work environments, even if it occurs outside of the workplace and is not work-related.  For instance, the Guidance cites the following examples of conduct occurring in an employee’s “virtual work environment” that employers can be liable for: “[a] sexist comments made during a video meeting, [b] racist imagery that is visible in an employee’s workspace while the employee participates in a video meeting, or [c] sexual comments made during a video meeting about a bed being near an employee in the video image.”

In addition to discussing conduct occurring in a “virtual work environment,” the Guidance also clarifies that conduct occurring in non-work-related contexts can contribute to a hostile work environment if it impacts the workplace.  This includes electronic communications through phones, computers, and social media.  For example, the Guidance cautions that, if an employee’s private social media posting subjects a co-worker to racial epithets, and other co-workers discuss the posting at work, then that posting “can contribute to a racially hostile work environment.”

Harassment Based On Sexual Orientation And Gender Identity

Another notable aspect of the Guidance is that it incorporates the U.S. Supreme Court’s 2020 landmark decision in Bostock v. Clayton County, 140 S. Ct. 1731, 1747 (2020), which held that Title VII’s prohibition of sex-based discrimination encompasses discrimination based on sexual orientation and gender identity.

While Bostock concerned an allegedly discriminatory employment discharge and did not involve harassment, the EEOC states in the Guidance that the Supreme Court’s reasoning “logically extends to claims of harassment.”  The Guidance therefore dictates that “sex-based harassment includes harassment on the basis of sexual orientation and gender identity, including how that identity is expressed.”

The Guidance lists several examples of conduct that can constitute this type of harassment, including: “[a] epithets regarding sexual orientation or gender identity; [b] physical assault; [c] harassment because an individual does not present in a manner that would stereotypically be associated with that person’s gender; [d] intentional and repeated use of a name or pronoun inconsistent with the individual’s gender identity (misgendering); or [e] the denial of access to a bathroom or other sex-segregated facility consistent with the individual’s gender identity.”

The EEOC also includes a hypothetical fact pattern in the Guidance depicting harassment based on gender identity.  In that hypothetical, supervisors and co-workers of a fast food employee who identifies as female commonly referred to the employee using her prior male name and pronouns, asked questions about her sexual orientation and anatomy, and asserted that she was not female.  In addition, customers “intentionally misgendered” the employee and “made threatening statements to her,” which the employer only responded to by reassigning the employee to a workstation where customers could not see her.  These facts, according to the EEOC, established harassment based on gender identity and, therefore, sex-based discrimination under Title VII.

Takeaways For Employers

The Guidance is a “must read” resource for employers to navigate potential harassment concerns.  It provides employers with an opportunity to revise their policies and protocols to better reflect the current legal landscape and the evolution of digital technology.  The Guidance also highlights the EEOC’s emphasis on enforcing Title VII’s prohibition of harassment based on sexual orientation and gender identity.

Employers should review their policies and practices to ensure they adequately protect against, and provide avenues to report, potential harassment that takes place virtually.  Likewise, employers may wish to consider incorporating examples of harassment given by the EEOC when implementing harassment prevention measures.

By Gerald L. Maatman, Jr., Derek Franklin, and Emilee N. Crowther

Duane Morris Takeaways: In EEOC v. Army Sustainment, LLC, No. 1:20-CV-234 (M.D. Ala. Sept. 26, 2023), Judge R. Austin Huffaker, Jr. of the U.S. District Court for the Middle District of Alabama granted in part and denied in part Defendant’s Motion for Summary Judgment.  The Court dismissed the EEOC’s “failure-to-accommodate” and “screening-out” claims against Defendant, in addition to holding that only four of the EEOC’s seventeen claimants could support the EEOC’s disability bias claim.  The Court also found that the Defendant employer’s policy barring employees from taking various prescribed medications was not, by itself, an adverse employment action.  For employers facing EEOC-initiated lawsuits involving ADA claims alleging discrimination and failure-to-accommodate, this decision is instructive in terms of what evidence courts are apt to consider in determining whether an employee suffered an adverse employment action, as well as what is required to trigger an employer’s duty to provide a reasonable accommodation.

Case Background

Defendant Army Sustainment LLC a/k/a Army Fleet Support (“AFS”) is a helicopter maintenance contractor which, from 2003 to 2018, employed aircraft mechanicals, technicians, and other aviation specialists at Fort Novosel (previously known as Fort Rucker).  Id. at 1.  AFS implemented a drug testing policy (the “Policy”) in 2012 requiring employees in “safety-sensitive positions” to submit to drug testing for opioids, amphetamines, and benzodiazepines.  Id.  Individuals who were legally prescribed these medications were cleared to work so long as they agreed not to take their medication within 6-to-8 hours before their shift.  Id. at 1-2.

In 2016, AFS eliminated the “6-to-8-hour rule,” and instead required employees to undergo a medical evaluation “to determine whether an employee’s prescription medication was appropriate for use during work hours.”  Id. at 2.  As part of the medical evaluation, the employee’s original prescribing doctor was asked “whether the employee was stable on their safety-sensitive medication or whether alternative medications were available that were as effective.”  Id.  If no alternative medications were available, and the employee was determined unable to safely work while taking the medication, the employee was deemed “disabled.”  Id.

In 2016, two AFS employees affected by the Policy filed discrimination charges with the EEOC.  The Commission found reasonable cause that AFS violated the ADA by “not allowing a class of individuals ‘to continue to work or return to work while taking their disability-related medications.’”  Id. at 2-3.  Further, the EEOC held that AFS’ Policy itself had “the effect of discrimination on the basis of disability” and violated the ADA.  Id. at 3.

The EEOC filed suit against AFS on behalf of 17 AFS employees who suffered from different disabilities, but were legally prescribed medications and required to undergo medical evaluations to return to work.  Id.  The EEOC brought four claims against AFS, including: (1) Discrimination on the Basis of Disability; (2) Failure to Accommodate; (3) Impermissible Qualification Standard; and (4) Interference.  Id.

The Court’s Decision

Timeliness Of The EEOC’s Enforcement Action

In Alabama, an employee bringing claims under Section 706 of Title VII “must file a charge with the EEOC within 180 days of the date of the alleged discrimination.”  Id. at 4.  Any claims filed with the EEOC after the 180-day period are time-barred.  Id.  AFS asserted that eight of the 17 claimants were time-barred, as their claims arose more than 180 days before the “representative charge” was filed with the EEOC.  Id.

The Court found that Section 706(e)(1) precluded the EEOC “from pursuing claims that arose outside the charging period, even when those untimely claims are related to otherwise timely claims.”  Id. at 5.  While the parties disagreed as to what date the “representative charge” was filed with the EEOC, the Court held that any claims that arose prior to May 23, 2016 (180 days before one of the representative charges were filed), were time-barred.  Id. at 6.  As such, the Court dismissed seven of the claimants from the EEOC’s lawsuit.  Id.

Whether Prohibiting Use Of A Medication Can Constitute An Adverse Employment Action

The Court’s first step in analyzing the EEOC’s disability discrimination claim was determining whether the claimants with timely claims experienced adverse employment actions.  The Court rejected the EEOC’s argument that requiring the claimants to stop using their prescription medications was an adverse action, and held that merely being required to stop using certain prescription medications, without more, did not have a tangible adverse effect on employment of the claimants.  Id. at 23. In making this determination, the Court explained that “[w]hether the employer’s conduct constitutes an actionable adverse employment action under the ADA is determined by whether a reasonable person in the plaintiff’s position would view the employment action in question as adverse.” Id. at 23.

The Court noted that while AFS required the claimants to sign a document acknowledging that their medications were “inappropriate for use in a safety sensitive work environment” and could result in discipline for employees if caught taking the medications, the Court held that “neither signing a form nor fear of termination are sufficient to constitute an adverse employment action.”  Id. at 24.

The Court’s Rejection Of Unpaid Leave As A Reasonable Accommodation

The Court also considered whether AFS, as a means of providing a disability accommodation, could place employees on unpaid leave until they either received medical clearance to return to work or agreed to stop taking their medications.  Id. at 25.

The Court rejected the notion that temporary leave is an accommodation rather than an adverse action. It reasoned that AFS “unilaterally forced the claimants on unpaid leave and did so without an accommodation request by the claimants or without any showing that the claimants could not actually perform their job duties either with or without their prescription medications.”  Id. at 27.  Thus, the Court denied summary judgment as to the claims of four AFS employees who alleged they suffered an adverse employment action after being placed on unpaid leave, and granted summary judgment in favor of AFS as to the remaining employees on this claim.  Id. at 28.

Summary Judgment Universally Granted On Claims of Failure-To-Accommodate And Screening Out Employees Under The ADA

The Court further held that AFS was entitled to summary judgment against all claimants based on their failure to establish a prima facie case for the EEOC’s failure-to-accommodate claim.  Id. at 37.  For example, the Court found the EEOC did not show that two of the claimants made accommodation requests to AFS or how any such requests would accommodate the limitations presented by their disabilities.  Id. at 36.

The Court’s penultimate holding concerned the EEOC’s claim that AFS’s drug policy constituted an impermissible qualification standard in violation of Sections 12112(b)(3) and 12112(b)(6) of the ADA by screening out qualified individuals with a disability.  Id. 41-42.  The Court granted summary judgment as to all claimants on the screening-out claim based on the EEOC’s failure to support its claim with statistical evidence or by showing that any of the claimants were actually terminated and “screened out” from their jobs.  Id.

Finally, the Court refused to consider or grant summary judgment on the EEOC’s interference claim because AFS failed to acknowledge it as a standalone cause of action and thus did not formally move for summary judgment on that claim.  Id. at 44-45.

Implications For Employers

Employers confronted with EEOC-initiated litigation involving restrictions on employee conduct outside the workplace should take note that the Court relied heavily on its assessment of whether “a reasonable person” in the claimants’ position would view the restriction in question as adverse.  Further, from a practical standpoint, the Court’s refusal to grant summary judgment on the EEOC’s failure-to-accommodate claims illustrates the potential risk of trying to use unpaid leave as an attempted means of reasonably accommodating an employee’s disability.

By Gerald L. Maatman, Jr., Alex W. Karasik, George J. Schaller, and Jennifer A. Riley

Duane Morris Takeaways:  In FY 2023, the EEOC’s litigation enforcement activity showed that any previous slowdown due to the COVID-19 pandemic is well in the rearview mirror, as the total number of lawsuits filed by the EEOC increased from 97 in 2020 to a whopping total of 144 in FY 2023. Per tradition, September 2023 was a busy month for EEOC-Initiated litigation, as this month marks the end of the EEOC’s fiscal year. This year, 67 lawsuits were filed September, up from the 39 filed in September of FY 2022.

Overall, the FY 2023 lawsuit filing data confirms that EEOC litigation is back in full throttle, with no signs of slowing down. Employers should take heed. Amplifying that activism, the Commission issued a press release at the end of the fiscal year touting its increased enforcement litigation activity, a somewhat unprecedented media statement that the EEOC has never issued in previous years.

Lawsuit Filings Based On EEOC District Offices

In addition to tracking the total number of filings, we closely monitor which of the EEOC’s 15 district offices are most actively filing new cases over the year and throughout September. Some districts tend to be more aggressive than others, and some focus on different case filing priorities. The following chart shows the number of lawsuit filings by EEOC district offices.

In FY 2023, Philadelphia District Office had by far the most lawsuit filings with 19, followed by Indianapolis and Chicago with 13 filings, and New York and Los Angeles each with 10 filings. Charlotte, Atlanta, Dallas, Phoenix, and Memphis had 9 each,  Houston had 8, Miami, Birmingham, and St. Louis had 7 each, and San Francisco had 5 filings.

The most noticeable trend of FY 2023 is the filing deluge in Philadelphia (19 lawsuits), compared to FY 2022 where Philadelphia District Office filed 7 lawsuits. Similarly, Indianapolis ramped up its filings compared to the 7 filings from FY 2022.  Like FY 2022, Chicago remained steady near the top of the list again with 13 filings.  Los Angeles, had a slight increase, based on the 8 filings it had in FY 2022.  Going another direction, Miami filings slightly fell compared to its 8 filings in FY 2022.   Finally, both New York and Charlotte increased their filings from FY 2022, with New York substantially increasing from 7, and Charlotte moderately increasing from 7 filings.

The balance across various District Offices throughout the country confirms that the EEOC’s aggressiveness is in peak form, both at the national and regional level.

Lawsuit Filings Based On Type Of Discrimination

We also analyzed the types of lawsuits the EEOC filed, in terms of the statutes and theories of discrimination alleged, in order to determine how the EEOC is shifting its strategic priorities.

When considered on a percentage basis, the distribution of cases filed by statute remained roughly consistent compared to FY 2023 and FY 2022. Title VII cases once again made up the majority of cases filed, making up 68% of all filings (down from the 69% filings in FY 2022, and significantly above 61% in FY 2021). ADA cases also made up a significant percentage of the EEOC’s September filings, totaling 34%, in line with 29.7% in FY 2022, although down from the 37% in FY 2021. There were also 12 ADEA cases filed in FY 2023, after 7 age discrimination cases filed in FY 2022.

The graphs below show the number of lawsuits filed according to the statute under which they were filed (Title VII, Americans With Disabilities Act, Pregnancy Discrimination Act, Equal Pay Act, and Age Discrimination in Employment Act) and, for Title VII cases, the theory of discrimination alleged.

Lawsuits Filings Based On Industry

The graphs below show the number of lawsuits filed by industry.  Three industries were the primary targets of lawsuit filings in FY 2023:  Restaurants with 28 filings, Retail with 24 filings, and Healthcare with 24 filings.  Not far off those industries are Manufacturing with 15 filings; Construction with 7 filings; Automotive, Security, and Transportation with 6 filings each; and Technology with 5 filings.

Hospitality and Healthcare employers should be keenly aware of the EEOC’s enforcement of alleged discriminatory practices in these sectors.  But in reality, employers in nearly any industry are vulnerable to EEOC-initiated litigation., as detailed by the below graph.

Looking Ahead To Fiscal Year 2024

Moving into FY 2024, the EEOC’s budget includes a $26.069 million increase from 2023, and focuses on six key areas including advancing racial justice and combatting systemic discrimination on all protected bases; protecting pay equity; supporting diversity, equity, inclusion, and accessibility (DEIA); addressing the use of artificial intelligence in employment decisions and preventing unlawful retaliation.

The EEOC also announced goals for its own Diversity, Equity, Inclusion, and Accesibility (DEIA) program where it seeks to achieve four goals, including workplace diversity, employee equity, inclusive practices, and accessibility. Additionally, the EEOC continues to polish its FY 2021 software initiatives addressing artificial intelligence, machine learning, and other emerging technologies in continued efforts to provide guidance.  Finally, the joint anti-retaliation initiative among the EEOC, the U.S. Department of Labor, and the National Labor Relations Board will continue to address retaliation in American workplaces.

Key Employer Takeaways

In sum, FY 2023 was a year of new leadership and structural changes at the EEOC.  With a significantly increased proposed budget, it is more crucial than ever for employers pay close attentions in regards to the EEOC’s strategic priorities and enforcement agendas.  We anticipate these figures will grow by next year’s report, so it is more crucial than ever for employers to comply with discrimination laws.

By Gerald L. Maatman, Jr., Gregory Tsonis, and Brittany Wunderlich

Duane Morris Takeaways: On August 21, 2023, Judge Barbara Rothstein of the U.S. District Court for the Western District of Washington granted the EEOC’s motion for reconsideration, reversing its decision granting summary judgment to defendant Telecare Mental Health Services of Washington, Inc.’s (“Telecare”) in a disability discrimination case entitled EEOC v. Telecare Mental Health Services of Washington, Case No. 2:21-CV-1339 (W.D. Wash. Aug. 21, 2023).  Despite giving the EEOC multiple opportunities to submit evidence rebutting Telecare’s argument that the claimant was not qualified for the position to which he applied, and the EEOC’s failure to do so prior to its motion for reconsideration, the Court ultimately found from the EEOC’s belated evidence that a disputed material fact existed that must be resolved by a jury.  The ruling demonstrates the difficulty in achieving summary judgment in an discrimination case, as well as the reluctance of courts to bar discrimination claims entirely. For employers handling EEOC litigation, this ruling is instructive, as successful motions for reconsideration are rare, and reversals of summary judgment even rarer.

The court noted that when ruling on Telecare’s motion for summary judgment, it gave the EEOC multiple opportunities to submit evidence rebutting Telecare’s argument that the claimant was not qualified for the position in which he applied. The court further chastised the EEOC for submitting such evidence for the first time in its motion for reconsideration, calling the EEOC’s failure “particularly egregious.”  Despite the EEOC submitting such evidence for the first time in its motion for reconsideration, the district court ultimately reinstated the claimant’s claim after finding that an issue of material disputed fact existed. 

Case Background

In 2019, claimant Jason Hautala applied for a position as a registered nurse at a Telecare facility that assisted the mentally ill. While Telecare extended an offer of employment to the claimant, the offer was conditioned on the requirement that Hautala pass a physical examination to determine his fitness for the position. Telecare ultimately rescinded its offer because the claimant had a permanent leg injury, which made him unable to perform the basic functions of a registered nurse.

The EEOC filed suit on behalf of Hautala under the Americans with Disabilities Act (ADA) claiming that Telecare discriminated against him because of his disability. Telecare moved for summary judgment, arguing in part that Hautala was not a “qualified individual” for the position under the ADA based on comments he made that reflected a negative attitude towards the mentally ill. Telecare alleged Hautala made statements including “in my youth, I used to enjoy a crazy person takedown, but as I get older, I enjoy these things less and less” and “fighting off meth heads isn’t as much fun in my 50s as it was in my 30s.”  Id. at 3. In support of its motion, Telecare submitted evidence that compassion toward patients with mental illness was an essential job function, and that Telecare would not hire someone who referred to patients as “crazy” or “meth heads.” The EEOC, in its opposition brief, failed to address Telecare’s argument or offer any contrary evidence.

The Court gave the EEOC a second chance to present evidence rebutting Telecare’s argument, requesting supplemental briefing on Telecare’s argument that Hautala was not a “qualified individual” for the position.  Despite the second opportunity to rebut Telecare’s position, the EEOC offered no contrary evidence and argued only that the comments, “as after-acquired evidence, could not be considered as a post hoc justification” for Telecare’s failure to hire Hautala.  Id. at 4.

Accordingly, the Court granted Telecare’s motion for summary judgment, holding that the EEOC failed to allege facts sufficient to support its prima facie case of discrimination under the ADA. In particular, the Court found that the claimant was not a qualified individual for the nursing position he applied for given Telecare’s undisputed evidence that Hautala had made the “troubling” and “inappropriate” comments, that compassion for patients suffering from mental illness was a necessary qualification for the position, and that the comments “conclusively demonstrated a lack of such compassion.”  Id.

The EEOC’s Motion For Reconsideration

The EEOC subsequently filed a motion for reconsideration of the summary judgment ruling in Telecare’s favor.  In doing so, the EEOC for the first time provided evidence that Telecare was aware of Hautala’s views towards the mentally ill, and argued that a material issue of fact required reinstating Hautala’s ADA claims.

The EEOC contended that it was entitled to reconsideration because subjective criteria (i.e., whether the claimant possessed the requisite compassion for the job) could not be considered as part of its prima facie case.  In rejecting this argument, the Court found the McDonnel Douglas burden-shifting framework inapplicable because Telecare admitted it did not hire Hautala based upon his disability, nor was the subjective criteria at issue “hotly contested” like the criteria in the EEOC’s cited precedent.

However, the Court found the EEOC’s second argument for reconsideration more convincing.  The EEOC argued that there was a disputed issue of fact as to whether Telecare knew of the claimant’s view on mentally ill patients during the application process, thereby contradicting Telecare’s argument that Hautera’s comments were disqualifying for the position.  The EEOC submitted as evidence an email from Telecare’s employees following Hautera’s interview in which they acknowledged Hautera’s comments, but nonetheless “advanced Hautala in the application process.”  Id. at 9.  As a result, in order to “avoid the potential for manifest error” and “in the interests of justice,” the Court concluded that summary judgement on the issue of whether Hautala was a qualified individual was not appropriate and that “[d]enying Claimant Hautala a chance to have his substantive disability discrimination claims heard based on the EEOC’s failure to timely present the issue is a potential injustice that is easily avoided.”  Id.   The Court, however, made clear that it was “not absolving” the EEOC “of its obligation to prove that Hautala was a qualified individual with a disability,” only that a factual dispute exists as to whether Telecare “would actually have considered the comments disqualifying.”  Id. at 10.

Though the Court ultimately reinstated the EEOC’s claim, Judge Rothstein chastised the EEOC for not citing this evidence in its summary judgment briefing, noting that the EEOC’s failure to cite to such evidence was “particularly egregious” given that the Court gave the EEOC a second chance to do so.  Noting that the parties filed over 1,000 pages of exhibits in support for their motions, the Court chastised the EEOC for failing to cite the evidence in its summary judgment briefs and noted that “[j]udges are not like pigs, hunting for truffles buried in briefs’ or on the record.”  Id. at 9.

Implications For Employers

This decision demonstrates the reluctance of courts to bar discrimination claims asserted by the EEOC even after severe and “egregious” missteps in litigation.  This latitude afforded to the EEOC, coupled with the resources available to the government in EEOC-initiated actions, requires close coordination with experienced counsel to defeat discrimination lawsuits at the pleading stage.  Employers faced with such claims should work closely with their counsel to ensure a comprehensive litigation strategy that maximizes the potential for defeating claims before the necessity of going to trial.

By Gerald L. Maatman, Jr., Alex W. Karasik, and George J. Schaller

Duane Morris Takeaways: On August 22, 2023, the EEOC announced the approval its Strategic Plan (“SP”) for Fiscal Years 2022-2026.  The Strategic Plan can be accessed here.  The SP furthers the EEOC’s mission of preventing and remedying unlawful employment discrimination and advancing equal employment opportunity for all.  The SP focuses on: (1) Enforcement; (2) Education and Outreach; and (3) Organizational Excellence. The SP also provides performance measures for each strategic goal.  For corporate counsel involved in employment-related compliance and EEOC litigation, the new SP is required reading.

The EEOC’s Strategic Priorities

1. Enforcement

The EEOC continues to promote equitable employment initiatives through its enforcement authority.  The SP highlights the EEOC’s primary mission of preventing unlawful employment discrimination through its administrative and litigation enforcement mechanisms, and adjudicatory and oversight processes.  The main strategic focus for employing these mechanisms is through fair and efficient enforcement based on the circumstances of each charge or complaint while maintaining a balance of meaningful relief for victims of discrimination.

As to enforcement, the SP provides a broad overview of the EEOC’s efforts to allocate its resources to ensure its efforts in stopping unlawful employment discrimination.  To that end, the EEOC indicates that it will continue its targeting of systemic discrimination through training staff on systemic cases and devoting additional resources to systemic litigation enforcement.  The SP included several performance measures for achieving enforcement goals, including measures on conciliation and litigation resolution, favorably resolving lawsuits, and increasing capacity for systemic investigations.

2. Education and Outreach

The SP prioritizes education and outreach for deterring employment discrimination before it occurs.  The SP focuses on providing education and outreach programs, projects, and events as cost-effective tools for enforcement.  Primarily these programs are aimed at individuals who historically have been subjected to employment discrimination.  Part of the EEOC’s education and outreach involves expanding use of technology through social media, ensuring the EEOC website is more user-friendly and accessible, and leveraging technology to reach the agency’s audience.

These efforts to improve on education and outreach are aimed at promoting public awareness of employment discrimination laws while maintaining information and guidance for employers, federal agencies, unions, and staffing agencies.  The SP provides an in-depth list of measuring education and outreach by utilizing technology to expand the EEOC’s audience and ensuring accessible delivery of information through events, programs, and up-to-date website accessibility and functionality.

3. Organizational Excellence

The SP makes clear that organizational excellence is the cornerstone of achieving the EEOC’s strategic goals.  The SP confirms that the EEOC aims to improve on its culture of accountability, inclusivity, and accessibility.  In addition, the EEOC seeks to continue protecting the public and advancing civil rights in the workplace by ensuring its resources are allocated properly to strengthen intake, outreach, education, enforcement, and service.

The EEOC’s organizational excellence strategic goal has two prongs, including improving the training of EEOC employees and enhancing the EEOC’s infrastructure.  For employees, the EEOC seeks to foster enhanced diversity, equity, inclusion, and accessibility in the workplace, maintain employee retention, and implement leadership and succession plans.  Relative to the agency’s infrastructure, the SP embraces the increased use of technology through analytics, and management of fiscal resources promote the agency’s mission of serving the public.

Implications For Employers

The EEOC’s SP is an important publication for employers since it previews immediate action areas.  The SP’s focus on systemic discrimination, conciliation, and litigation, and increasing the Commission’s capacity for litigating alleged systemic violations shows the EEOC is ramping up to improve handling all aspects of charges.  The EEOC’s increased focus on technology and employment discrimination awareness similarly shows accessibility will continue to be a pillar of the agency.  Accordingly, prudent employers should be mindful of these strategic priorities, and prepare themselves for continued EEOC enforcement.

By Gerald L. Maatman, Jr., Alex W. Karasik, and George J. Schaller

Duane Morris Takeaways: In EEOC v. Above All Odds, LLC, No. 1:21-CV-02492 (D. Md. Aug. 15, 2023) (ECF No. 50), a federal district court in Maryland issued an arrest warrant for an ex-executive of a company involved in an EEOC lawsuit. The EEOC alleged that the ex-executive sexually harassed employees of a mental health clinic. The Court issued the  arrest warrant due to the ex-executive refusal to cooperate in the case and with discovery orders.

For employers facing EEOC-initiated lawsuits, the issuance of an arrest warrant is a novel development but informative in terms of the perils of continuously ignoring court orders. 

Case Background

The EEOC initiated this lawsuit on behalf of three former workers, Bricciana Strickland, Shana Hanson, and Saidah Feyijinmi, of Above All Odds, LLC (“Company”) and the Company’s co-founder, Raymond Dorsey, alleging a pattern of sexual harassment of female employees.  (Compl. at 1).

Strickland alleged Dorsey sent text messages asking for a date, and when she refused, Dorsey responded by stating he could fire her from her position.  Id. at 5-6. Hanson alleged Dorsey made repeated unwanted sexual advances including Dorsey asking if he could rub her back, sending an email with pornographic content, and throwing condoms on her desk.  Id. at 7. Feyijinmi alleged she saw Dorsey throw condoms on Hanson’s desk.  Id. at 8. Together, Hanson and Feyijinmi reported Dorsey’s sexual harassment to the Company’s senior management. Id. at 7.

Strickland continued to reject Dorsey’s advances and was demoted, and ultimately Dorsey ordered members of management staff to terminate her.  Id. at 6. Hanson was terminated in response to reporting Dorsey’s conduct.  Id. at 7. Feyjinmi was presented with a new contract of employment that lowered her salary and required her to work two positions, and after she requested time to review the contract before signing, the company terminated her before she had the opportunity to sign her contract.  Id. at 8-9.

The Arrest Warrant

Throughout the course of the lawsuit, Dorsey failed to respond to the EEOC’s complaint and ignored several show cause orders directing him to appear in court.  Subsequently, the court found Dorsey in contempt of court in June 2023.

Dorsey also ignored a subpoena to appear in the case brought by the EEOC.  Thereafter, the court authorized the arrest of Raymond Dorsey and issued an arrest warrant on August 15, 2023.

Implications For Employers

Employers that are confronted with EEOC-initiated litigation involving allegations of a pattern of sexual harassment should note that ignoring court filings, court proceedings, and orders issued by the court, may result in the court taking action.  In this instance, the court relied on the ex-executive’s lack of response to pleadings, court orders, and subpoenas leading to the court issuing an arrest warrant.  While the issuance of arrest warrants is rare in litigation, this development illustrates that court orders should not be taken lightly.