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Busted settlement can’t revive bias suit

by on
in Discrimination and Harassment,Employment Law,Human Resources

Sometimes employees who have agreed to accept settlements in return for dropping discrimination claims change their minds—especially if they believe the employer didn’t deliver everything it promised in the settlements. They’d rather ditch the agreements and restart the original lawsuits. They can’t.

In such situations, their only option is to sue for breach of contract. The only remedy is to receive what the settlement agreement stipulated.

Recent case: Kathleen Sharp filed an EEOC complaint against her employer, the Worthington City School District Board of Education. The English teacher claimed she had been terminated as a result of race discrimination.

The district and Sharp’s attorneys negotiated a settlement, which Sharp signed. The agreement required Sharp to drop the EEOC complaint in exchange for a year’s worth of work. She also agreed to resign at the end of the year.

The school board then told Sharp to report for work as a tutor at the Worthington Children’s Home, a school for special-needs students. The job apparently wasn’t to her liking, so she didn’t show up after the first two days.

Instead, she filed her race discrimination lawsuit, alleging the school board had breached its settlement agreement by placing her in a tutor position. She said its breach of contract meant she was entitled to revive the original lawsuit.

The court disagreed. It said that Sharp could sue for breach of contract, but that her original discrimination case was dead. Although the court hinted that it might have ruled differently had Sharp shown she was duped into signing the agreement or that the employer had settled in bad faith. That wasn’t the case. (Sharp v. Worthington City School District Board of Education, No. 2:08-CV-0225, SD OH, 2008)

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