EEOC Pursues Obama Administration Agenda

By Lehr Middlebrooks Vreeland & Thompson, P.C.

May 25, 2017

Assumptions that the EEOC under a Republican administration will be more favorable to business than under a Democratic administration are not necessarily correct. For example, during President George W. Bush's two terms, the EEOC filed an average of 400 lawsuits a year with only two years of filing fewer than that number. During President Obama's administration, only twice did the EEOC file more than 200 lawsuits in a year and during Fiscal Year 2016, it filed only 114, the lowest during the past 30 years. Furthermore, the rate of "cause" determinations also fell to a record low during the Obama administration.

With that preface, let's review the actions of the EEOC thus far during President Trump's administration. Commissioner Victoria Lipnic (Republican) was appointed Acting Chair of the Commission. She was the only commissioner who voted against the EEOC's revised EEO-1 reporting requirement, which included the onerous pay band reporting. Yet, she has suggested that although she favors "tweaking" that requirement, she does not envision the Commission revoking it. One of President Trump's objectives is to reduce the burden of federal regulation on business, with an outcome to enhance job creation. The EEOC estimated that it would take an employer 31 hours to comply with the new EEO-1 requirements, which was consistent with an SHRM survey that found it would take 30 hours. That is not the kind of regulation that is considered a burden to job creation.

As Acting Chair, Lipnic has outlined an aggressive agenda for the EEOC, which it is pursuing today. For example, this year marks the 50th anniversary of the Age Discrimination in Employment Act. The EEOC is focusing on age discrimination in hiring, as evidenced by the lawsuit it filed on May 17 against Ruby Tuesday, Inc., in the Southern District of Florida. In that case, the EEOC alleges that the employer discriminated against a 59-year-old candidate for a managerial position, because it wanted to "maximize longevity and minimize premature resignations." In a similar matter, in March the Commission and Texas Roadhouse, Inc., agreed to $12 million in settlement of a lawsuit based upon age discrimination against a class of over 40-year-olds who applied for server and host positions.

An issue pending in federal courts is whether the ADEA permits rejected job applicants to use a discriminatory impact theory. In a discriminatory impact claim, the essence of the allegation is that an employer's apparently neutral business practice has a disproportionate effect on one protected group compared to others. In the case of Rabin v. PricewaterhouseCoopers, the claim is that the company's reliance on on-campus recruiting at colleges had a discriminatory impact based upon age, as those in the age-protected group are generally long past their college years. In its recent U.S. Corporate Responsibility Summary Report, PWC stated that the average age of its workforce is 27 and 75% of its employees said their job with PWC was their first job out of college.

In addition to focusing on age discrimination, the Trump administration EEOC will aggressively pursue pay equity claims. Pay equity based on gender has been the primary focus nationally, but the EEOC will also pursue pay equity based on race and ethnicity. Furthermore, high on the Commission's agenda under the Trump administration will be discrimination based on pregnancy, such as denial of leave or termination of individuals who are pregnant.

Employers are well experienced with the concept of "managing expectations." This is particularly important as we move forward with the Trump administration EEOC. We do not foresee the President engaging in any policy action that will divert the EEOC from its strategic enforcement direction.