EEOC plays hardball? Continue to negotiate

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in Employment Law,Human Resources

The EEOC is supposed to engage in a conciliation process before suing employers for alleged employment violations. But sometimes the agency comes out with guns blazing, demanding a huge payment to settle a complaint.

Some employers naturally respond negatively—and they may even walk away without further discussions. One employer recently did just that, and then tried to get a federal court to dismiss the EEOC lawsuit.

It said the EEOC refused to conciliate in good faith and should there­­fore not be allowed to pursue the claim in court. It didn’t work.

Recent case: Derrick Morgan worked at a McDonald’s restaurant. He was demoted when his perform­­ance didn’t meet expectations. Then he found a job at a grocery store, but told the McDonald’s franchise he wanted to remain on call for extra hours.

After a month, the franchise concluded Morgan had quit. Then it received an EEOC complaint notice and order to appear at a conciliation meeting. That’s when it learned that Morgan claimed he was either ­disabled or perceived as disabled.

At the initial conciliation meeting, the EEOC investigator offered to settle the case for $304,000. The McDonald’s franchise owner countered with a $5,000 offer and requested information on the claimed disability. The investigator said it was a mental disability and that at least one manager had admitted he knew Morgan was disabled.

Morgan rejected the $5,000 offer; the EEOC countered with $199,000. That’s when the em­­ployer walked out.

The EEOC sued and the franchise asked the court to toss out the case because of what it said were bad-faith negotiations.

The court refused. It said the EEOC has broad latitude in offering settlements and can sue when employers walk out. (EEOC v. Alia, No. 1:11-CV-01549, ED CA, 2012)

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