Editor’s comment: While the ability of the EEOC to investigate potential discrimination is important, the facts of this case lead the editor to believe the EEOC hasn’t figured out how to focus on potential instances of ongoing harmful discrimination rather than past policies of now non-existent companies which do not appear to have been harmfully discriminatory at first blush. It is hard to imagine which anyone really believes a policy of not hiring violent criminals is unacceptable discrimination—if your company makes it a policy to hire violent criminals, please reply as we have some vocational claims which may provide you with a steady stream of available employees.
In EEOC v. Watkins Motor Lines, Inc., No. 08-2483 (January 23, 2009) the Seventh Circuit on appeal from the United States District Court for the Northern District of Illinois, Eastern Division was presented with a question regarding whether the EEOC has subject matter jurisdiction to complete investigation including the power to ask the District Court to adjudicate subpoena enforcement actions even after the charging party asks to withdraw their charge.
By way of background, in June 2004 after experiencing three episodes of employee-on-employee murder or attempted murder, Watkins Motor Lines decided which it would no longer hire anyone who had been convicted of a violent crime. Three months later Watkins rejected Lyndon Jackson’s application because of his criminal record. He filed a complaint with the Equal Employment Opportunity Commission, which opened an investigation to determine whether the policy had a disparate impact on minority applicants—and, if so, whether it was “job related for the positions in question and consistent with business necessity”. Watkins did not cooperate in the investigation, and on April 8, 2005, the EEOC issued a subpoena seeking pertinent information which was ignored. Jackson and Watkins reached a settlement in January 2006 and Watkins insisted the settlement be contingent on the EEOC’s abandonment of its investigation. Jackson told the EEOC he was withdrawing his charge of discrimination however the EEOC’s regulations give it discretion whether to allow a charge to be withdrawn, and the EEOC decided to press ahead with an investigation which may cover persons in addition to Jackson. In September 2006 Watkins Motor Lines sold its operating assets to FedEx. Since Watkins remains potentially liable to Jackson and any similarly situated applicants, the proceeding was not moot. The district court did not act on the subpoena until March 2008, when it dismissed for lack of subject-matter jurisdiction the EEOC’s motion (filed in July 2007) to enforce the subpoena. The judge believed Jackson would be best served by the settlement, and since settlement was contingent on withdrawal of the charge the agency should have allowed him to withdraw it, reasoning the agency’s contrary decision was arbitrary so it was as if no charge had been filed—and, if no one makes a valid charge, the EEOC is not entitled to investigate.
The Seventh Circuit notes the judge appears to have believed the lack of a pending charge deprives the court of subject-matter jurisdiction, however two provisions of Title VII itself authorize district courts to adjudicate subpoena-enforcement actions filed by the EEOC and 28 U.S.C. §1345 creates subject-matter jurisdiction for any suit filed by the United States or one of its agencies. A district court’s belief the EEOC should not have investigated or sued does not detract from the fact it did ask the court to enforce its subpoena. A statute authorizes the court to adjudicate this request.
Watkins contends Jackson’s request to withdraw his charge should have been granted. Yet withdrawing a charge does not mean a valid charge was never filed. Watkins didn’t contend, and the district court did not find Jackson’s charge was invalid when filed. Once one has been filed, the EEOC rather than the employee determines how the investigation proceeds. The Seventh Circuit noted the suit affects legal rights of persons other than the initial plaintiff, and some other member of the class is entitled to intervene to carry on with the litigation. The Seventh Circuit further noted allowing settlement contingent on vacatur of all judicial decisions made so far, in order to relieve the parties of any preclusive or precedential effects which the decisions carry would almost be automatic if allowed. The problem with this type of decision would be allowing litigants to achieve their settlement by injuring other, unrepresented persons. The Seventh Circuit noted many a defendant would love to decapitate a class after the statute of limitations has run by paying off the sole representative plaintiff, and thus avoiding potential liability to all other class members. The Seventh Circuit noted the EEOC and the judiciary are not obliged to abet this strategy by preferring Jackson’s interests over those of other workers. Jackson and Watkins Motor Lines are free to resolve their own dispute but may not compromise the interests of other employees and applicants in the process. The EEOC’s regulation says “[a] charge filed by or on behalf of a person claiming to be aggrieved may be withdrawn only by the person claiming to be aggrieved and only with the consent of the Commission . . . where the withdrawal of the charge will not defeat the purposes of Title VII”. The agency is entitled to vindicate the interests of all employees and applicants.
Finally, the Seventh Circuit appears to hint Watkins should have asked to affirm the judgment on the ground the subpoena was needlessly burdensome or otherwise inappropriate and the Seventh Circuit further noted they (like the district judge) questioned whether the EEOC is acting prudently by devoting time of both its staff and Watkins to short-lived practices by an entity which is no longer an operating company, and whose rule may well be amply supported by “business necessity” given its history of workplace violence. But the Seventh Circuit confirmed the Executive Branch rather than the Judicial Branch is entitled to decide where investigative resources should be devoted and a charging party’s change of mind does not diminish the agency’s authority to investigate on its own behalf so the judgment of the district court was reversed, and the case was remanded with instructions to enforce the subpoena.
This case is a pretty straightforward example of the power of governmental agencies to conduct their investigations and how a single charge, however lacking in basis or evidence—even lacking cooperation of the charging party—can continue to create legal issues for a company. It is difficult for us to recommend a company consider not implementing rules or policies which may offend the “senses” of parties from whom you are attempting to protect you business or workforce at large. Instead, we suggest consideration of the common sense approach to litigation where you detail the lack of evidence, the valid purpose behind your policy and the valuable time and resources being wasted. Based upon the decision reviewed, it appears the courts still value their time even if our government agencies do not. This article was researched and written by Shawn R. Biery, J.D. If you have thoughts and comments or need the case citation, please send a reply to sbiery@keefe-law.com.
