EEOC Reports More Money, Fewer Lawsuits for FY 2020

Annual report reflects shift toward mediation and conciliation under former agency chair

In fiscal year 2020, the U.S. Equal Employment Opportunity Commission filed fewer lawsuits while recovering more money for victims of discrimination, according to the agency’s annual performance report.

According to the report released Jan. 19, the number of merits suits filed by the EEOC was the second lowest in 29 years, reflecting a shift in priorities under former EEOC Chair Janet Dhillon. Dhillon, a Republican, headed the commission from May 2019 until last month. In the role, she had prioritized conciliation and mediation over litigation, which she said should be used as “a last resort.” 

The EEOC filed 93 merits suits in FY 2020, down from 144 in FY 2019 and 199 in FY2018, according to the report. Meanwhile, the success rate for conciliations reached 43.6% in FY 2020, compared to 40% in FY 2019 and just 27% in 2010. 

In July, the EEOC announced two pilot programs to expand and encourage use of its mediation and conciliation processes. The conciliation pilot, which began in May, sought to “drive greater internal accountability and improve the EEOC’s implementation of existing practices.” 

The mediation pilot expanded the categories of charges eligible for mediation and allowed for mediation throughout the stages of an investigation. Prior to the pilot, charges were generally only referred for mediation prior to an investigation. 

Holland & Hart attorney Devra Hake previously worked at the EEOC and said she remembers thinking the agency’s mediation arm was “underutilized” at the time. “With this new pilot program that came out in 2020, where mediation is more available throughout the stages of an investigation,” she said, “I think employers are taking advantage of that and using mediation more to efficiently resolve charges of discrimination.”

“I think the plus with the pilot program,” Hake added, “is that it gives employers a little bit of time to dig into the issues and to more effectively assess risk going forward, rather than having to decide whether to mediate very early on with little information.”

It’s not clear whether the shift toward mediation and conciliation will continue under new EEOC leadership. Both pilots were originally slated to last six months. On Jan. 6, the EEOC announced the mediation pilot would be extended through the end of FY 2021 in September. But on Jan. 27, the commission, under newly appointed chair Charlotte Burrows, announced the pilot programs had ended and that the EEOC’s mediation program would incorporate pilot program “practices the agency has found useful,” particularly the use of video for virtual mediations.

Burrows, who has served on the EEOC since 2014 and was designated by President Joe Biden to lead the commission on Jan. 20, had previously criticized the agency’s mediation pilot as a “grave injustice and a violation of EEOC’s responsibility to enforce the law.” Burrows told Bloomberg Law in July that Dhillon lacked authority to unilaterally institute the mediation pilot program and requested that Dhillon change the pilot program to require an investigation before allowing mediation.

While the number of lawsuits dropped last year, the amount of money recovered for victims of discrimination reached all-time highs. According to the report, the EEOC secured a record $535.4 million in FY 2020 for workers claiming discrimination, more than $333 million of which was recovered through mediation, conciliation and other administrative settlements. More than $106 million was recovered through litigation, the highest amount since 2004. 

Hake said the higher dollar amounts might be partially driven by COVID-19. “Employers are so busy trying to respond to the pandemic that these charges and lawsuits, which maybe employers would have fought till the bitter end [pre-COVID], they’re now making the business decision to resolve it and to move on to other issues,” Hake said.

More than $106 million was recovered through litigation in FY2020, the highest amount since 2004. “I think the reduction in the amount of litigation coupled with the increase in the amount recovered reflects a policy shift from a while back where they’re looking to root out systemic discrimination,” said Sherman & Howard member John Doran. He added that going after systemic discrimination at a large employer allows the EEOC to recover more money while filing fewer lawsuits. According to the report, 13.9% of the lawsuits filed in FY2020 addressed systemic discrimination, and the EEOC obtained nearly $70 million in relief for victims in 33 systemic cases.

Of the 93 merits lawsuits filed, nearly 40% alleged violations on the basis of sex while 31% alleged age-based violations, 28% alleged retaliation and 14% involved race-based allegations. More than 68% of the $106 million the EEOC secured through litigation was recovered through Title VII lawsuits.

Hake said that in her practice, there has been a trend toward more retaliation charges compared to other areas such as sex or race discrimination. Statistics from the EEOC show a steady rise in the percentage of charges claiming retaliation over the past two decades, with nearly 54% of all charges filed in FY2019 claiming retaliation, compared to just over 25% in FY1999.

“[Retaliation] is still the most difficult thing for employers to defend against, and the easiest thing for employees to claim,” Doran said. “And even though it’s not a number that jumps off the page at you, when you look at retaliation every year, this report should be a reminder to employers: When people engage in protected activity, whether you like it or not, you have to tread very lightly.”

Although Biden has designated the EEOC’s two Democratic commissioners to serve as chair and vice-chair, Republicans will remain the majority on the commission until July 2022. “I don’t think we can expect any major policy shift at the commission level,” Doran said, adding that with Burrows controlling the EEOC’s agenda as chair and Republicans in the majority, neither side will be able to push through major policy changes. 

“I do think that current events tend to push enforcement priorities,” Doran added. 

Hake said she expects to see an increase in disability charges related to COVID. “The COVID guidance that we’ve gotten from the EEOC has been fantastic,” she said, but added employers are constantly facing new questions due to the pandemic, such as what to do about employees who don’t want to get vaccinated.

Doran said that in addition to COVID-related lawsuits, he expects the national immigration debate to create more litigation over national origin and race discrimination. There’s also the “omnipresent issue of LGBTQ rights versus religious liberty,” he said, “and how the commission chooses to pursue litigation to strike whatever balance it sees as the right balance between those two sometimes competing policy choices.” 

—Jessica Folker

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