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The AR Group

EEOC Conciliation that?s Not Very Conciliatory

This is the fourth blawg in a series we began in an effort to summarily highlight how the EEOC?s stated objectives have been manifested since being outlined in the Strategic Enforcement Guidelines issued in January of 2013. As noted previously, one of the primary issues the EEOC identified was ?Addressing emerging issues.? On this issue, the EEOC has increasingly endeavored to rely on conciliation process to resolve disputes.

?Conciliation? is just a fancy word for trying to reach a settlement before an EEOC Investigation and determination evolves into an actual lawsuit brought by the agency.? It’s an option many employers want to at least explore before having to engage in the costly defense of a discrimination suit brought by the EEOC.? The requirement that the EEOC engage in good faith conciliation is not discretionary, and is expressly required under Title VII.

When the EEOC makes a ?reasonable cause? determination in the course of investigating a charge of discrimination, it triggers a mandatory responsibility under 42 U.S.C. ? 2000e-5(f)(1) to engage in good faith conciliation efforts before filing a lawsuit. This responsibility is not supposed to be a mere formality that is satisfied by merely making a few telephone calls and then checking a box on an agency form. ?Conciliation, after all, serves important public interests by, among other things, guaranteeing administrative due process to the accused, protecting the public from unwarranted litigation expense, and conserving scarce administrative and judicial resources. It is for these reasons that federal courts uniformly recognize that the responsibility of good faith conciliation is so important that honoring it is a condition precedent to the EEOC filing a lawsuit.

To satisfy the statutory requirement of good faith conciliation, the EEOC must: (1) outline to the employer the reasonable cause for its belief that the law has been violated; (2) offer an opportunity for voluntary compliance; and (3) respond in a reasonable and flexible manner to the reasonable attitudes of the employer. If a court finds that the EEOC terminated conciliation prematurely or failed to conciliate in good faith, it may stay the action and compel the EEOC to conciliate or dismiss the lawsuit. 42 U.S.C. ? 2000e-5(f)(1) (1976) (the court may ?in its discretion stay further proceedings for not more than sixty days pending further efforts of the Commission to obtain voluntary compliance?).

Asserting bad faith conciliation can be an important defense available to employers in federal court.? So what are some hallmarks of ?bad faith? conciliation? Denying an employer?s reasonable request for a face-to-face meeting is a common and compelling factor in finding that the EEOC has failed to conciliate in good faith. Another very common tactic found by the courts to be unreasonable and in bad faith is if the EEOC takes an ?all-or-nothing? approach to settlement. As noted by the United States Court of Appeals for the Fifth Circuit, ?[t]he EEOC’s take-it-or-leave-it demand for more than $150,000 represents the coercive, ?all-or-nothing approach? previously condemned by this court??? Lastly, federal courts have held that the EEOC?s failure to explain its monetary demands is not reasonable and does not allow a defendant to properly respond.

On June 30, 2014, the U.S. Supreme Court announced that it had agreed to hear a case to decide whether federal courts can review the conciliation efforts of the EEOC. The EEOC takes the position that conciliation efforts are not reviewable by federal courts. The agency recently scored a significant court victory as to that position, and that is the case that will be reviewed by the Supreme Court. In EEOC v. Mach Mining, LLC, the United States Court of Appeals for the Seventh Circuit ruled that an alleged failure by the EEOC to conciliate is not an affirmative defense to the merits of a discrimination suit.? The Seventh Circuit further noted that ?conciliation is an informal process entrusted solely to the EEOC?s expert judgment and that the process is to remain confidential? and ?[a] court reviewing whether the agency negotiated in good faith would almost inevitably find itself engaged in a prohibited inquiry into the substantive reasonableness of particular offers ? not to mention using confidential and inadmissible materials as evidence ? unless its review were so cursory as to be meaningless.?

Mach Mining has petitioned for review by the United States Supreme Court because the Seventh Circuit?s decision conflicts with the rulings in other circuits, and the EEOC also asked the Supreme Court to review the ruling so as to definitively determine if the EEOC?s pre-litigation conciliation efforts are subject to federal court review.? The Supreme Court will hear the case in its 2014-15 term, which begins in October of this year.

 

Smart Tip: Seek advice and counsel before agreeing to conciliation or mediation before the EEOC.