Without New Charge, EEOC Can't Look Into Shortened Time to Sue Imposed by Employer

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By Patrick Dorrian

Nov. 25 — The Equal Employment Opportunity Commission's investigation of a fired Indiana worker's sexual harassment and retaliation charge can't be expanded to include a companywide inquiry into the employer's imposition of a shortened limitations period on applicants, a federal court ruled Nov. 24.

The U.S. District Court for the Southern District of Indiana denied the EEOC's bid to enforce an administrative subpoena it served on temporary staffing agency Forge Industrial Staffing. Information relating to a clause in the company's standard employment application requiring workers to waive longer statutory limitations periods in favor of a six-month limit on their time to sue wasn't relevant to the charge that prompted the EEOC's investigation, the court found.

The charge didn't contain any allegations of a pattern or practice of discrimination by Forge or that the shortened limitations period impeded the charging party's ability to complain about discrimination, Magistrate Judge Mark J. Dinsmore decided. He said the majority of federal appeals courts have held that, absent an allegation of companywide bias in the underlying discrimination charge, the EEOC isn't authorized to expand a charge investigation to include such systemic bias.

The decision is the latest development in the ongoing battle between employers and the commission regarding the limits of its subpoena authority and the courts' role in reviewing EEOC-issued subpoenas under federal anti-discrimination laws.

The U.S. Court of Appeals for the Eleventh Circuit recently joined the majority view by holding that the EEOC wasn't entitled to hiring and firing statistics on a broad class of Royal Caribbean Cruises Ltd. workers and applicants who aren't U.S. citizens, because the information was unrelated to the underlying charge filed by a single worker (EEOC v. Royal Caribbean Cruises, Ltd., 2014 BL 314942, 30 AD Cases 1553 (11th Cir. 2014)).

Fired After Reporting Harassment

According to the opinion, Forge placed Samara Jenkins in a temporary assignment at a Pep Boys distribution center. Jenkins complained to both companies in May 2013 that a co-worker was sexually harassing her.

Forge informed Jenkins June 4 that Pep Boys had terminated her assignment. On Sept. 16, 2013, Jenkins filed a charge against Forge with the EEOC, alleging sexual harassment and retaliation under Title VII of the 1964 Civil Rights Act.

While investigating Jenkins's charge, the EEOC obtained a copy of her employment application. It included a clause stating that she was required to file any claims or lawsuits arising out of her application or employment within six months of the event giving rise to the claim, and that she was expressly waiving all longer limitations periods set by statute.

The EEOC requested additional information about the clause from Forge, but the company declined to produce it. The EEOC then served a subpoena on the company requesting a copy of each version of employment application used by Forge between Jan. 1, 2012, and May 31, 2014, as well as related information.

Forge refused to comply with the subpoena. The EEOC filed an application for subpoena enforcement in federal district court.

Commission's Application Denied

Dinsmore noted that court oversight of EEOC enforcement proceedings is limited as long as the commission only seeks information that is relevant and isn't unduly burdensome for the employer to produce. By statute, he added, relevance is measured from the allegations in the charge under investigation.

Although the First and Fourth circuits have embraced the EEOC's view of the scope of its investigation powers, the Third, Fifth, Seventh and Eleventh Circuits have held to the contrary, Judge Dinsmore noted.

“The relevance requirement is designed to ‘prevent fishing expeditions,' ” and the burden is on the EEOC to show “a realistic expectation rather than an idle hope” that the information requested will lead to the discovery of relevant evidence, the judge said. Here, he found, Jenkins filed her charge well within the six-month limitations period set in her employment application and Forge acknowledged that it couldn't assert a timeliness defense to her allegations.

The EEOC thus “seeks to launch an unrelated investigation into a new and unrelated class of employees—those whose claims may have been affected by signing the waiver,” Dinsmore said, denying the application for subpoena enforcement.

He rejected the contention that the information was relevant because it was related to the overall conditions in Jenkins's workplace, saying that accepting that argument would “eviscerate” the relevance requirement. The EEOC's view that it has a “broader mandate” to protect the public at large from workplace bias was likewise unpersuasive, because Title VII expressly limits the agency's investigative authority to matters relevant to the underlying charge, the judge said.

Although the First and Fourth circuits have embraced the EEOC's view of the scope of its investigation powers, the Third, Fifth, Seventh and Eleventh Circuits have held to the contrary, Dinsmore noted. He said a more recent ruling by the Seventh Circuit—which includes Indiana federal courts—didn't support the EEOC's position, because the charging party alleged a pattern, not just a single instance, of bias.

Agency Can File Commissioner's Charge

Forge estimated it would take the company more than 2,166 hours to comply with the subpoena, which would make compliance unduly burdensome, the court added.

Dinsmore found that, like the Eleventh Circuit in Royal Caribbean Cruises, the Seventh Circuit has noted that the EEOC is always free to file a commissioner’s charge when it discovers evidence of a broader pattern of discrimination while investigating a single-party charge.

Thus, “the EEOC in this case must file a broader charge before investigating alleged discrimination unrelated to the complainant’s original charge,” the judge wrote.

Michelle Eisele and Jo Ann Farnsworth of the EEOC in Indianapolis represented the commission. Uma Chandrasekaran and William F. Dugan of Seyfarth Shaw in Chicago represented Forge.

To contact the reporter on this story: Patrick Dorrian in Washington at pdorrian@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

Text of the opinion is available at http://www.bloomberglaw.com/public/document/EQUAL_EMPLOYMENT_OPPORTUNITY_COMMISSION_v_FORGE_INDUSTRIAL_STAFFI.