Seyfarth Synopsis: We are once again pleased to offer our loyal blog readers a breakdown of the five most intriguing developments in EEOC litigation in 2020, in addition to a pre-publication preview of our annual report on developments and trends in EEOC-initiated litigation. This year's book, titled EEOC-Initiated Litigation: 2021 Edition, provides a comprehensive examination of the EEOC's filings in FY 2020 (from October 2019 through September 2020), and the major decisions handed down this year in pending EEOC litigation.
Every employer should monitor EEOC litigation activity. It is the surest way to avoid becoming the EEOC's next target. Each year, Seyfarth Shaw conducts a thorough analysis of all EEOC activity to keep our readers up to date on current trends and, hopefully, provide a peek inside the EEOC's decision-making process. Our annual report is targeted towards human resources professionals, corporate counsel, and other corporate decision-makers. We hope that it proves useful as they attempt to steer clear of EEOC-initiated litigation in 2021.
This year, we have once again categorized our analysis of substantive developments in line with the EEOC's strategic priorities. This is the fourth year of the EEOC's current Strategic Enforcement Plan ("SEP"), which covers Fiscal Year 2017 through 2021. It has been our experience that analyzing developments in EEOC litigation in light of the enforcement priorities set forth in the SEP provides a better understanding of the EEOC's focus and agenda.
The full publication will be offered for download as an eBook. To order a copy, please click here.
As always, we like to take a moment at the end of one year, and the beginning of the next, to look back at the most intriguing decisions and developments of the year.
Here is our list of the "top five" most intriguing developments of 2020.
A Year Of Change
FY 2020 saw a flurry of activity at the EEOC. Notably, the EEOC made strides to update its conciliation and mediation procedures, voluntarily scaled back some of its own litigation authority, and sought opportunities to collaborate with its fellow federal agencies. On top of these developments, the EEOC also saw substantial change in its leadership, with three new Commissioners (two Republicans and one Democrat) being sworn in. This activity and change in leadership translated to a significant decline in the number of cases filed by the EEOC against employers in FY 2020, with only 101 total cases filed (as compared to 149 in FY 2019 and 217 in FY 2018).
These will be important developments to continue to watch in FY 2021 and beyond. Our analysis of these issues can be found here.
Development #1: A Definitive Ruling by the U.S. Supreme Court On LGBTQ Employment Rights
Few issues have garnered as much of the EEOC's attention over the past few years as its efforts to have LGBTQ discrimination recognized as a prohibited form of discrimination under Title VII. That issue was finally resolved in 2020 by the Supreme Court in the landmark decision of R.G. and R.H. Funeral Home v. EEOC/Bostock v. Clayton County, which decided three cases that touch on these issues. On June 15, 2020, the Supreme Court held that Title VII prohibits discrimination against gay or transgender employees as a form of sex discrimination. The 6-3 decision authored by Justice Gorsuch represents a significant victory for the EEOC.
In its opinion, the Supreme Court held that "[a]n employer who fires an individual for being homosexual or transgender fires that person for traits or actions it would not have questioned in members of a different sex. Sex plays a necessary and undisguisable role in the decision, exactly what Title VII forbids." 140 S.Ct. 1731, 1737 (June 15, 2020). The Supreme Court reasoned that because discrimination on the basis of homosexuality or transgender status requires an employer to intentionally treat individual employees differently because of their sex, an employer who intentionally penalizes an employee for being homosexual or transgender also violates Title VII.
The EEOC has been diligently pursuing this theory of discrimination in the courts for years, resulting in quite a few victories in line with the Bostock decision. Employers should expect that the EEOC will be even more vigilant in enforcing this new federal workplace protection for the foreseeable future. The full implications of this decision's impact on the American workforce will have to wait for future developments as Bostock is interpreted and applied in courts across the country. Further analysis of this case can be found here and here.
Development #2: In Religious Discrimination Law: Accommodations In The COVID-19 Era
In a notable decision involving the COVID-19 pandemic, in EEOC v. Baystate Medical Center, the EEOC alleged that an employer's policy requiring employees to either receive a flu vaccine, or wear a mask if they have a religious or health-related objection to vaccination, violated Title VII. Case No. 16-CV-30086 (D. Mass. June 15, 2020). The EEOC contended that the employee declined the vaccination because of her Christian faith. The employer had provided the employee with a mask to wear inside the hospital buildings, but after the employee repeatedly pulled down her mask to speak with people over the phone and in person, the employer suspended and eventually terminated her employment for failure to comply with the policy. In its ruling, the Court opined that the charging party had no religious objection to the mask requirement. Moreover, the Court held that the EEOC failed to present any evidence from which a jury could find that the mask requirement was merely a pretext for its actual intention of forcing individuals to get vaccinated. Developments in this area will be a must-watch for employers in 2021.
Development #3: Reasonable Accommodations Under The ADA: Increased Scrutiny Of "Direct Threat" Defense
In EEOC v. T&T Subsea, LLC, the U.S. District Court for the Eastern District of Louisiana considered whether a diver was qualified for his position even though he could not pass a dive physical when he was terminated. 457 F. Supp. 3d 565 (E.D. La. 2020). The employer asserted a "direct threat" defense, arguing that the charging party posed a significant risk to the health or safety of others that could not be eliminated by reasonable accommodation. The Court denied summary judgment to the employer on that defense because of the existence of "genuine issues of material fact regarding whether [employer] meaningfully assessed [charging party's] ability to perform his job safely based on the best available objective evidence and reasonably concluded that [charging party] posed a direct threat." Id. This case highlights the scrutiny under which the "direct threat" defense has been analyzed by some courts.
Development #4: Continued Focus On Complex Employment Relationships And Structures
The EEOC has recently put more focus on complex employment relationships and structures in the 21st century workplace, specifically with respect to temporary workers, staffing agencies, independent contractor relationships, and the on-demand economy. For example, in EEOC v. 1618 Concepts, Inc., the U.S. District Court for the Middle District of North Carolina refused to dismiss from a lawsuit two corporate affiliates of the entity that actually employed the charging party. No. 19-CV-672, 2020 WL 87994 (M.D.N.C. Jan. 7, 2020). In that case, a male dishwasher alleged that he had been sexually harassed by a male coworker, that his managers witnessed at least one of those instances of sexual harassment, and that the employer generally was aware of the harassment. The EEOC issued a letter of determination to the charging party's employer entity and two affiliated entities.
The employer argued that the two entities that were not named in the charge should be dismissed because the failure to name a party in an EEOC charge constitutes a failure to exhaust administrative remedies against that party and a subject-matter jurisdiction defect as to any Title VII claim brought against the unnamed party. The District Court found that the three employer entities named in the lawsuit were closely interrelated; they shared employees, common ownership, common management, and corporate officers. The District Court also found that each of the employer entities had effective notice of the EEOC's investigation and therefore could not claim that they had been prejudiced by lack of notice.
Development #5: Additional Insight Into Interaction Between Title VII And The Equal Pay Act
In EEOC v. First Metropolitan Financial Service, Inc., the U.S. District Court for the Northern District of Mississippi had an opportunity to apply Title VII and the Equal Pay Act ("EPA") in a way that elucidated their different burdens of proof and burden-shifting schemes. 449 F. Supp. 3d 638 (N.D. Miss. 2020). In the case, the EEOC brought a class action complaint under the EPA and Title VII, alleging that a financial lending company paid female Branch Managers less than male Branch Managers. The employer argued that the two female Branch Managers did not have substantially similar responsibilities as their male Branch Manager comparators because they had been hired to manage a new branch, which had relatively few outstanding loans and therefore less responsibility compared to more established branches.
In its opinion, the Court noted that the two statutes apply different standards for establishing a prima facie case, but nevertheless concluded that "[h]aving found that the Plaintiff successfully established a prima facie case under the Equal Pay Act, the Court also finds that the evidence used under the EPA burden is sufficient to establish a prima facie case under Title VII." Id. However, the Court's opinion reflected critical nuances between the burdens of proof after a prima facie case had been established under each law.
It is possible that the incoming Biden administration will bring new and significant changes to the EEOC's enforcement program. But with a Republican-led Commission in charge until 2022, it is difficult to say how quickly the new administration can implement such changes. Against this backdrop of political change, 2021 is also the last year of the current Strategic Enforcement Plan. That could make this year an interesting one in terms of changing perspectives and priorities as the agency decides on a new enforcement path for the next four years. We fully expect that those changes will reveal themselves in the theories the EEOC chooses to advance and the types of cases they file just as much as they will in the EEOC's official pronouncements. We look forward to keeping our readers apprised of these changes as they occur!
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