Employers Under Siege: Discrimination Complaints Flooding Into the EEOC
It was a chance to consort with the enemy—a powwow with the U.S. Equal Employment Opportunity Commission. And everyone wanted in.
That’s how Linda Burwell of Detroit’s Nemeth Burwell described her clients’ reactions when she invited them to have breakfast on Oct. 17 with the EEOC. Burwell said her clients were eager to “see what the EEOC is doing and why they are doing it.”
Many of Burwell’s clients who attended the breakfast are facing EEOC charges, some for the first time. “A lot of people had questions” for the agency, said Josephine Avery, vice president of human resources of the Motor City Casino Hotel, who attended the breakfast. It was “a good opportunity to hear what they had to say.”
And what did the EEOC say? “We’re not the big bad government coming after them, and we truly do want to forge a partnership [with employers], but we have to enforce these laws,” said Deborah Barno, the supervisory trial attorney in the Detroit EEOC office, noting that the jobless are seeking legal redress like never before. “Our lobby is full every day, and mailed-in charges are increasing even more.” The Detroit office of the EEOC alone has 2,500 complaints pending before it—25% more than it had pending at the start of the recession in 2007.
Welcome to the world of employers under siege. Discrimination complaints from their former and current employees are flooding into the EEOC and similar state agencies. Management lawyers are getting their desperate calls. And the lawyers anticipate that, by the end of 2009, the number of claims will look even worse.
From 2007—the recession first started in December of that year—to the end of 2008, overall claims filed with the EEOC increased by 28%, from 83,000 to 95,000. Discrimination claims jumped by 28%, and retaliation charges—what lawyers call the hottest charge these days—jumped by 22% last year, from 27,000 to 33,000 claims. The EEOC does not have numbers yet for 2009.
Similarly, in the Fulbright & Jaworski 2009 Litigation Trends Survey, corporate counsel reported significant rises in employment disputes during the past 12 months. Discrimination claims, in particular, went up 11%.
Lawyers anticipate even more EEOC claims this year, when job losses grew still worse. Some of those EEOC claims will become full-fledged EEOC lawsuits. More of them will be sent back to the plaintiffs to pursue their own suits.
A ‘More Assertive’ Agency
“I think it’s clear that the increase in layoffs, at a time when there are no alternative jobs, have increased litigation,” said Jeffrey Klein, chairman of the national employment litigation practice at New York-based Weil, Gotshal & Manges. Most recently, Klein said he’s witnessed an increasing number of discrimination civil rights claims heading to state courts, where larger damage awards are possible. Klein said he’s also seen a spike in age-based claims and an uptick in EEOC charges driven by retaliation claims.
Perhaps as worrisome, Klein said, is that the EEOC “has become more proactive and more assertive.” He pointed to tougher laws that the EEOC is enforcing, such as the recently amended Americans With Disabilities Act, which widened the pool of those eligible to claim disability discrimination.
At a time when employees are losing jobs in high numbers, the EEOC can’t afford not to be aggressive, said Carol Miaskoff, assistant legal counsel to the EEOC. “Age and race discrimination claims are going up the most,” Miaskoff said. “We’re swamped.”
Helping to handle the onslaught are 170 new EEOC investigators who started work this fall after being hired during the summer to replace previous staff losses.
Management-side lawyers say it’s not just the rise in complaints that worries them. They see a rise in current employees filing EEOC complaints in hopes of protecting themselves in the event of layoffs. Chuck Baldwin, a partner in the Indianapolis office of Ogletree, Deakins, Nash, Smoak & Stewart, explained the rationale: “If I’m causing a fuss about something, you won’t pick me to lay off…and, if I am let go, then I’ll claim retaliation.”
So far this year, Baldwin said he’s handled about 50 EEOC charges against clients, “and that’s clearly an uptick.” Some clients who rarely face complaints are now being hit with several complaints, while some are facing their first EEOC claims ever. “That’s pretty good evidence that something is going on now,” he said.
William “Zan” Blue, a partner in the Nashville, Tenn., office of Atlanta-based Constangy, Brooks & Smith, also has clients who are getting hit with EEOC charges for the first time, including a manufacturer that’s been in business since the 1950s but is facing its first two EEOC charges this year: one for gender discrimination, the other for race discrimination.
And it’s not just the EEOC that’s getting swamped with discrimination claims. Blue said the number of charges filed with the Tennessee Human Rights Commission has so overwhelmed the agency that it has publicly called for mediation to help reduce the backlog. “We never have seen a special call for mediation specifically to help reduce the backlog before,” said Blue.
Other states’ agencies report their own overflow. The Michigan Department of Civil Rights says age discrimination complaints have increased 77% during the past three years, from 703 in 2005 to 1,245 in 2008. And the Florida Commission on Human Relations reports that employment discrimination complaints in the last fiscal year were up 30% from the previous year. Retaliation was the No. 1 complaint, accounting for nearly 50% of complaints, followed by race and sex discrimination.
Gathering Storm
Because of the EEOC review process, there is a lag between discrimination complaints filed with the agency and such complaints hitting court dockets. But the cases are starting to hit. A group of laid-off California lab workers and scientists filed an age discrimination lawsuit in state court in May against the federally funded Lawrence Livermore National Laboratory. The plaintiffs allege that, out of the 440 laid-off workers, the vast majority were senior employees let go because they were older.
In federal court in Northern Virginia, a man is suing the Fidelity National Title Insurance Co. for age discrimination after he was replaced by a younger worker. The plaintiff, a 60-year-old underwriter, claims he was laid off five months after he recovered from a serious heart condition and returned to work. Soon after, the suit alleges, his hours and pay were cut, followed by the layoff.
Thirteen laid-off waiters are suing the New York Yankees baseball team in state court for allegedly replacing them with younger and cheaper staff.
And in July, computer giant Dell Inc. agreed to pay $9.1 million to settle a gender and age discrimination class action in Texas. Human resource executives claimed, among other things, that Dell laid off women and those older than 40 disproportionately when it started cutting 9,000 jobs last year.
The EEOC itself filed a class action against AT&T Inc. in August for age discrimination on behalf of older workers who left the company under an early retirement plan as part of corporate downsizing. The suit in New York federal court claims that AT&T discriminated against older workers by denying them the chance to be rehired. Younger workers, who had been let go by means other than early retirement, were given that chance.
Not everybody expects the flood of EEOC complaints to head for court. Sarah Kelly, a partner at Cozen O’Connor in Philadelphia who defends employers, said the staggering number of job losses has not produced a rash of lawsuits—at least not as far as she can tell. She suggested that plaintiffs’ lawyers “may think juries will not be sympathetic to claims of those let go because of the loss of business generally.”
Or, Kelly theorized, “it could just be the calm before the storm.”
Tresa Baldas can be contacted at tbaldas@alm.com.