Thursday, October 22, 2009

Why Isn't the EEOC Pursuing Better Consent Orders?

In my last post, I discussed the EEOC’s pursuit of systemic harassment cases and noted that they almost always settle with the entry of a consent order.  Today, I want to take a closer look at some of those consent orders and consider whether the EEOC is missing an opportunity to pursue positive structural changes in some workplaces that need them.

As part of a recent project, I reviewed the consent orders that were publicly available in EEOC pattern or practice of harassment cases.  The consent order recently entered in EEOC v. Corrections Corp. is a fairly typical one.  The highlights of that consent order include: 

(1) monetary relief in the amount of $1.3 million; 

(2) enjoining the employer from maintaining a hostile work environment or retaliating against an employee complaining of a hostile work environment;

(3) requiring the employer to maintain policies and practices that help assure a work environment free from sexual harassment of their employees, including maintaining a 1-800 number for reporting complaints;

(4) requiring the employer to retain a training consultant to provide consultation and training on sexual harassment for 3 years.  This consultant must provide one live training session (at least 90 minutes, plus at least 15 minutes for Q&A) annually for the first 3 years, after which time the defendant may use a videotape of the training session;

(5) requiring HR and managerial staff to be provided 2 hours of training on prevention of harassment and retaliation;

(6) requiring the employer to maintain a written policy concerning sexual harassment, which must meet certain identified minimum criteria;

(7) requiring the employer to assign outside investigators to investigate any complaints of harassment; and

(8) requiring the employer to self-report to the EEOC its compliance with the consent order.

Most of the consent orders that I researched in systemic harassment cases likewise focused on monetary relief, changes to written policies and handbooks, similar mandatory harassment training requirements, and self-reporting. 

The Corrections Corp. consent order also appears to be generally consistent with the EEOC’s overall approach to consent orders in sex discrimination cases.  A study by The WAGE Project examined a total of 160 consent decrees (or EEOC summaries of unavailable consent decrees) in sex discrimination cases.  Of those, 96% contained some form of monetary award, 57% contained employee training requirements, and 56% contained compliance reporting requirements.  Only 21% required the appointment of a monitor.  Less than 3% contained provisions allowing the EEOC to conduct interviews with employees in the future.  I discuss a potential problem with this approach after the jump.

There are good reasons to doubt the effectiveness of the EEOC’s approach.  Professor Susan Bisom-Rapp and others have extensively researched the effectiveness of mandatory harassment training programs.  Professor Bisom-Rapp argues that, when poorly implemented, mandatory harassment training programs are ineffective and even counterproductive.  They can give the appearance of legal compliance without actually accomplishing any real change in the work environment.  They can also lead to employee backlash.  See, e.g., Susan Bisom-Rapp, An Ounce of Prevention is a Poor Substitute for a Pound of Cure, 22 Berkeley J. Emp. & Lab. L. 1, 31-38, 44-45 (2001).

What I find curious about the EEOC’s approach is that, in the past, the EEOC has been more ambitious about obtaining meaningful prospective relief that will lead to structural change in workplaces.  In both EEOC v. Mitsubishi and EEOC v. Dial (mentioned in my last post), the EEOC required the appointment of an independent monitoring panel as part of the consent order.  The panel consisted of one member appointed by the employer, one by the EEOC, and a chairperson agreed to by the parties.  The employer compensated the panel members at rates agreed to by the parties and the panel members.  The panel conducted periodic reviews and reported to the EEOC.  Importantly, the panel was allowed to gain information about the problems in the workplace over time and to make recommended proposals for change.  The employers were required to adopt the panel’s recommendations, subject to an objection and resolution procedure.  This allowed for solutions to be developed and implemented that were uniquely tailored to the problems observed in each employer’s workplace.  In addition, the employer in Dial was also required to permit the EEOC to conduct periodic follow-up interviews with employees.  EEOC Regional Attorney for the Chicago District Office John Hendrickson has touted the positive results in the Mitsubishi case, and has specifically noted the importance of the “sleeves-up, in-the-trenches work of the Consent Decree monitors” in accomplishing substantial change in the workplace.  See Selected Materials on “Multiple Plaintiffs and Class Actions in Sexual Harassment Matters,” PLI Order No. 8483 (June 2006).  And the Mitsubishi and Dial consent orders represent just a few examples of potential prospective solutions that could be incorporated into consent orders.  Other examples might include requiring employers to collaborate with industrial psychologists or organizational consultants and implement their recommendations. 

So why hasn’t the EEOC been pursuing more creative and effective prospective relief, tailored to the individual circumstances and problems of each employer?  Why is the EEOC placing so much emphasis on obtaining large monetary settlements for the individual claimants?  After all, as one court recently reminded us, “[T]he EEOC’s ability to secure enforcement of Title VII on behalf of the public is primarily served through its ability to secure injunctive relief, not bootstrapping individual damage claims into the EEOC’s enforcement action.”  See EEOC v. Burlington Med. Supplies, Inc., 536 F. Supp. 2d 647, 659 (E.D. Va. 2008).

Perhaps the EEOC is emphasizing monetary relief in these cases because of a belief that large monetary settlements will deter tolerance of harassment in other workplaces.  There seems to be little empirical support for that position, and in fact there may be at least some reason to doubt it.  See Michael Selmi, The Price of Discrimination:  The Nature of Class Action Employment Discrimination Litigation and Its Effects, 81 Tex. L. Rev. 1249, 1305 (2003) (arguing that the filing and settlement of large class action discrimination suits has had little, if any, deterrent effect).  If anything, news of large monetary settlements might give other employers an incentive to adopt some cosmetic changes – like mandatory harassment training and changes to written policies – that will give the appearance of legal compliance while having very limited effectiveness in actually changing behavior.  The relative deterrent effects of monetary damages and prospective injunctive relief, however, are certainly worthy of further study. 

Perhaps employers are just unwilling to agree to more intrusive prospective measures (or unwilling to agree to pay for them).  It is essentially impossible for us to determine what positions the parties are taking during the negotiations leading up to these consent orders.  But it seems unlikely that the EEOC can get employers to agree only to annual standard harassment training sessions, when it was previously able to implement much more comprehensive programs in the Mitsubishi and Dial consent orders.  In any event, employers’ resistance to such programs might be tempered if the EEOC changed its focus and emphasized the importance of meaningful prospective measures in negotiations, rather than just focusing on the relative size of the monetary payments.  Individual claimants with strong claims for monetary damages could intervene in the EEOC’s enforcement action to protect their own pecuniary interests – as they often do, and as 3 of the 21 claimants did in Corrections Corp.

In any event, it seems to me that when negotiating consent orders in cases like Corrections Corp., the EEOC would do well to keep in mind the words of the Burlington court.  The EEOC does the most public good by spurring actual structural changes in workplaces through effective injunctive remedies, not by simply maximizing the monetary payment it can extract from the employer.

-Jason Bent

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This is a great post, Jason. I would suspect that there are several reasons that the EEOC isn't getting that concession in consent orders, all of which relate to resources and political climate.

One reason is related to the way that the EEOC tracks its performance. It primarily has measured performance almost purely quantitatively: how many charges processed, cases litigated, cases won, cases settled, employees affected, dollars recovered. It has been criticized for this quantitative approach by the National Association of Public Administration, which did a study a few years ago to assess the EEOC's performance. But numbers are easier to track and measure than qualitative standards--and with few resources, that's what the EEOC has done. Additionally, that seems, from what I can tell, that prior administrations required of the agency.

Monitoring the employer may be expensive as well. Agency resources would have to be expended even where the employer paid for an outside monitor because ultimately the agency would have to be able to determine whether the employer was complying.

I think another reason is that there was little political will in the executive branch generally to have monitoring, at least under the prior administration, and probably the prior several. Privatization and self-reporting were thought to be the best/most efficient governance strategies. So there may have been little push to have the EEOC get the concession.

Related to that, the EEOC and Title VII are seen as remedial and not regulatory. Monitors are regulatory.

Finally, I doubt that in the current climate most employers would agree to monitoring unless they were really committed to change--which is going to depend a lot on the circumstances of the discrimination. Nancy Levit's article on Megacases sort of digs into this a bit. But some considerations might be that upper level leadership might realize that it doesn't have effective control on the ground and wants the outside help. Additionally, the company may need the good press that the fact of an outside monitor would demonstrate.

And ultimately, I don't think many courts would order monitoring in the current climate (and that's ultimately the stick you use to settle--would a court order something worse) unless the underlying situation was particularly egregious. Perhaps it was bad enough in the corrections case, but there's that underlying hesitation to act as a super-personnel board for private employers. So what incentive would an employer have to agree to such an invasive measure?

Posted by: Marcia | Oct 22, 2009 7:44:49 PM

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