EEOC Officials Respond to GOP Criticisms During Senate Committee Oversight Hearing

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By Kevin McGowan

May 19 — The Equal Employment Opportunity Commission is pursuing discrimination investigations even when no individual has complained of bias and is focused on pursuing high-profile lawsuits raising novel issues even as the agency's backlog has grown to more than 75,000 pending charges, Senate Health, Education, Labor and Pensions Committee Chairman Lamar Alexander (R-Tenn.) said May 19.

Speaking at the committee's oversight hearing, Alexander said the EEOC continues to engage in the abuses and missteps that prompted a Senate Republican staff report last November sharply criticizing the agency's direction and priorities.

The EEOC's recently proposed Americans with Disabilities Act regulations addressing employer-sponsored wellness programs also don't fix the problem of employer confusion caused by inconsistent federal agency regulations regarding wellness programs that the administration encouraged under the Affordable Care Act, Alexander said.

Meanwhile, the panel's Democrats said the EEOC is doing its best with limited resources to advance the equal employment opportunity mandate first identified more than 50 years ago in Title VII of the 1964 Civil Rights Act.

“It is time for Congress to step up and give the EEOC the resources it needs to fight discrimination in our nation's workplaces,” said Sen. Patty Murray (D-Wash.), the committee's ranking Democrat. “That would help the agency reduce its severe backlog.”

Lawsuits a ‘Last Resort,' EEOC Says 

As part of its efforts to reduce the charge backlog, EEOC Chair Jenny Yang said the agency during fiscal 2014 hired and trained more than a hundred new frontline staff and is continuing those efforts in the current fiscal year.

Efficient case management includes an emphasis on the early, successful resolution of charges, which the EEOC achieves through mediation and conciliation, she said. “Litigation truly is a last resort” for the agency, Yang testified.

The U.S. Supreme Court's decision in Mach Mining, LLC v. EEOC, 2015 BL 123508, 126 FEP Cases 1521 (U.S. 2015) , which held the agency's conciliation efforts are subject to narrow judicial review, is a “positive step forward” for the EEOC and its stakeholders, Yang said. The agency is working to provide additional guidance to all its investigators on Mach Mining and its implications, she said.

Responding to questions from Murray, Yang said the EEOC last year audited seven different field offices to examine the adequacy of its conciliation process. The agency in fiscal 2014 had a 38 percent success rate in conciliation, which occurs after the EEOC investigates and finds reasonable cause to believe discrimination has occurred, Yang said. That's an increase from a 27 percent conciliation success rate in earlier years, she said.

In his testimony, EEOC General Counsel P. David Lopez echoed the theme that the EEOC is focused on preventing discrimination and always tries informally to resolve bias charges before resorting to lawsuits.

“Most of our cases settle,” either before the agency sues or after a lawsuit is filed, Lopez said. The EEOC's general counsel during fiscal 2104 successfully resolved 93 percent of its cases, and the agency from fiscal 2011 to the present has won two-thirds of the jury trials it has litigated, Lopez said.

While courts sometimes have ruled against the EEOC, Lopez said he encourages an agency culture focused on “lessons learned” from both winning and losing cases. That means the EEOC reviews all its litigation and makes an “immediate adjustment” to any internal problems identified, he said.

Yang said agency investigators closed more than 80,000 discrimination charges in fiscal 2014 but almost 90,000 new charges also were filed. Through its systemic program and strategic enforcement plan, the EEOC is trying to direct its resources where the agency can do the most good, she said.

The EEOC is determined to ensure “we don't repeat the mistakes” some courts have identified, Lopez said. He added, however, that despite some “missteps,” the EEOC makes a “positive contribution” to the mission of ensuring equal opportunity in the workplace.

Texas Roadhouse Case a Flashpoint 

Alexander questioned Lopez about a Craigslist advertisement posted online that asked persons who thought Texas Roadhouse restaurants had refused to employ them because of age to contact the EEOC. More broadly, Alexander asked why the EEOC is soliciting complaints and suing the restaurant chain when no age bias charge has been filed and a backlog of more than 75,000 discrimination charges is pending.

“We did not issue that ad,” Lopez said. The EEOC neither put out the Craigslist advertisement nor contracted with anyone else to do so, Lopez said.

When Alexander asked if the EEOC ever uses Craigslist to search for discrimination claimants, Lopez replied that as far as he knows, the agency doesn't do so.

Later during the hearing, Sen. Tim Scott (R-S.C.) returned to the EEOC's age bias lawsuit against Texas Roadhouse, which is pending in a federal district court in Massachusetts.

Scott asked why the EEOC is wasting taxpayer money pursuing cases in which no individual has complained of discrimination rather than using its limited resources to work through the backlogged charges.

“There seems to be a consistent pattern” at the EEOC of “looking for something else to do” rather than investigate the individual charges, Scott said. In addition to the Texas Roadhouse litigation, Scott cited the EEOC's pending investigations of purported age bias by large accounting firms against their partners as cases in which the agency is investigating even though no individual has complained.

“With respect to litigation, it’s a small fraction,” Lopez replied, referring to lawsuits based on an EEOC commissioner's charge instead of an individual charge. In hiring cases, an individual applicant may never know why he or she wasn't selected, he added.

Regarding Texas Roadhouse in particular, Lopez said, “There is a lot of information in that case with evidence of age discrimination.”

That includes “very significant” statistical disparities and “compelling anecdotal evidence,” Lopez said. The EEOC complaint cites evidence of comments indicating the restaurant chain favored younger people for front-of-the-house positions, Lopez said.

Scott remarked he had traveled to different restaurants to examine their front-of-the-house operations. “Having visited half a dozen, maybe more, restaurants, they all appear the same on the front end,” he said. “When you look at [Texas Roadhouse's] specific case without information gathered from the application, I would like to hear the anecdotal evidence to have a better understanding of what it takes to get to where you are.”

Lopez promised to provide Scott with that information.

Systemic Program a Key Component 

Commissioner's charges under Title VII and “directed investigations” under the Equal Pay Act and Age Discrimination in Employment Act all are “tools” authorized by Congress, Lopez said. The agency's use of those techniques is “no departure” from the EEOC's “ordinary practice” during prior administrations, he said.

Only 12 EEOC lawsuits have been filed based on commissioner's charges or directed investigations since 2010, Lopez said.

The EEOC has used the commissioner's charge and filed lawsuits alleging systemic discrimination during both Republican and Democratic administrations, said Sen. Christopher S. Murphy (D-Conn.) Although some employers might welcome the EEOC not exercising those powers, the agency's “continued reservation” of its authority to do so hasn't changed over the years, Murphy said.

Sen. Pat Roberts (R-Kan.) expressed concern the EEOC seems to be looking for “patterns of discrimination” outside the individual charges filed with the agency when examining the 75,000-plus pending charges might be a better use of agency resources.

Yang said agency investigators closed more than 80,000 discrimination charges in fiscal 2014 but that almost 90,000 new charges also were filed. Through its systemic program and strategic enforcement plan, the EEOC is trying to direct its resources where the agency can do the most good, she said.

About 25 percent of the EEOC's litigation docket now consists of systemic cases, the highest proportion in the agency's history, Yang said. “We think that's a good balance of our resources,” she said. Systemic cases refer to those in which the challenged employment policy or practice broadly affects an entire industry, occupation or wide geographic area.

The EEOC in 1990 had more than 3,000 employees, but the agency's staff since then has been cut by about 1,000 employees even as the U.S. workforce has grown and Congress has given the EEOC added responsibilities, said Sen. Elizabeth Warren (D-Mass.).

The investigation and filing of systemic cases “may be one of the best ways” for the EEOC to use its limited resources, Yang said. Under the systemic program, the EEOC “carefully identifies” the cases it's going to file and aims at “lasting changes” in employer practices that might be causing widespread discrimination, she said.

EEOC and Wellness Programs 

The EEOC April 20 issued its proposed Americans with Disabilities Act regulations addressing employer-sponsored wellness programs and when employers can offer financial incentives or rewards to participants without rendering the programs “involuntary” under the ADA. Public comments on the proposal are due June 19.

The EEOC is aiming by the end of July to produce a proposed rule under the Genetic Information Nondiscrimination Act to address GINA's effects on wellness programs, Yang told the Senate panel.

The EEOC's proposed rule under the ADA “doesn't solve the problem” raised by the EEOC's pursuit of different standards for wellness programs than those contained in the joint regulations issued by the Labor Department, Treasury Department and Department of Health and Human Services under the Affordable Care Act, Alexander said.

After the EEOC in 2014 filed two ADA lawsuits against employers with wellness programs that apparently complied with the ACA, Alexander and other congressional Republicans this year introduced legislation intended to shield employers from ADA lawsuits if their wellness programs are consistent with the ACA and its implementing regulations. The Senate HELP Committee also held a Jan. 29 hearing on the benefits of wellness programs.

At the May 19 hearing, Alexander expressed disappointment the EEOC proposal adopts a limit on permissible employer monetary incentives for wellness plan participants that differs from the incentives allowed under the ACA and its implementing regulations. He asked Yang whether the EEOC would take his proposed legislation into account when finalizing the ADA proposed rule.

“We are looking forward to feedback from all sources,” Yang replied. She added the EEOC wants to produce a final rule “that can work for companies” that sponsor wellness programs to improve their employees' health.

The EEOC issued its proposed rule only after coordination with the Labor Department, Treasury and HHS, the agencies responsible for implementing the ACA and the Health Insurance Portability and Accountability Act, Yang said in her prepared testimony.

“We recognize that many employers wish to implement wellness programs in an effort to improve their employees' health and reduce health care costs,” Yang said in her prepared statement. “We are also mindful that wellness programs must adhere to the ADA's requirement that disability-related inquiries (such as questions on a health risk assessment) or medical examinations (such as blood tests for cholesterol levels) that are part of employee health programs must be ‘voluntary.' ”

To contact the reporter on this story: Kevin McGowan in Washington at kmcgowan@bna.com

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

 

Text of EEOC Chair Yang's prepared testimony is available at http://op.bna.com/dlrcases.nsf/r?Open=kmgn-9wnnbn, General Counsel Lopez's prepared testimony at http://op.bna.com/dlrcases.nsf/r?Open=kmgn-9wntbj, and Sen. Alexander's opening statement at http://www.help.senate.gov/newsroom/press/release/?id=c2640b43-7358-4775-bbc5-40c0a9674f6d&groups=Chair.