by Art Gutman Ph.D., Professor, Florida Institute of Technology

In a ruling on 10/26/11, Judge John E. Conway of the District Court of New Mexico ordered the EEOC to pay $140,000 in attorneys’ fees to Tricore Reference Labs for “frivolous, unreasonable, or groundless” pursuit of an ADA claim (EEOC v. TriCore Reference Labs., D.N.M., No. 09-CV-956 JEC/DJS). This is the latest in a list of setbacks for the EEOC --- but more on that later.

The claim in the Tricore case is that the employer failed to reasonably accommodate Rhonda Wagnoer-Alison, a phlebotomist, for her Osteoarthritis. The EEOC alleged that Wagoner-Alison can perform the essential functions of her job with or without reasonable accommodation. However, it turns out that (1) Wagoner-Alison’s Osteoarthritis rendered her incapable of standing and walking, both of which were deemed essential job functions, and that (2) the EEOC continued to pursue the claim beyond the point of knowing it had a failed claim. In the words of Judge Conway:

“reasonable accommodation” does not require an employer to substantially restructure or reallocate essential functions of a disabled employee's position and that in answering TriCore's requests for admission, EEOC admitted that Wagoner-Alison's condition rendered her unable to stand and walk, which were essential functions of the phlebotomist position.

Translated, that means Wagoner-Alison faced an insurmountable barrier (i.e., inability to perform all essential job functions even with accommodations), and that the monetary award of legal fees is based on Judge Conway’s belief that the EEOC knew (by June 4, 2010) that it could not establish a prima facie ADA claim, but continued to pursue the claim anyway.

By itself, the Tricore ruling is not that big a deal. However, when viewed in the context of other recent rulings against the EEOC, some of the defense attorney blog cites are claiming that the EEOC has adopted a “shoot-first, aim later” habit (see, for example Let’s examine the facts.

As a starter, two rulings against the EEOC have been noted in past Alerts. First, as posted on August 20, 2011, the EEOC was ordered to pay 2.6 million for attorneys’ fees and costs in EEOC v. Cintas [2011 U.S. Dist. LEXIS 86228] for failure to fully investigate individual claims in a class action suit, and failure to engage in “conciliation measures”, both of which are Title VII requirements. Second, as posted on March 2, 2010, the EEOC was ordered to pay roughly 4.5 million in EEOC v. CRST Van Expedited [2010 U.S. Dist. LEXIS 11125] because it based a pattern or practice claim for 68 women on the claim of one of the women before it knew of or investigated the claims of the other 67 women, prompting the judge to claim the EEOC pursued a “sue first, ask questions later litigation strategy.”

On top of that, we have EEOC v. Peoplemark decided on March 31, 2011 [2011 U.S. Dist. LEXIS 38696]. Here, the EEOC claimed that Peoplemark had a “blanket policy” of excluding felons in the hiring process, and this policy adversely impacted blacks. Critically, the EEOC had a list with of 286 names of supposed rejected black applicants, and 22% of these applicants were, in fact, hired. The court ruled:

This is one of those cases where the complaint turned out to be without foundation from the beginning. Once the EEOC became aware that its assertion that Peoplemark categorically refused to hire any person with a criminal record was not true, or once the EEOC should have known that, it was unreasonable for the EEOC to continue to litigate on the basis of that claim, thereby driving up defendant’s costs, because it knew it would not be able to prove its case.

As a result, the claim was dismissed and Peoplemark was awarded $750,000 in attorneys’ fees, expert witness fees, and costs.

There are other cases, but what piques our interest in Peoplemark is that the EEOC has, since 2008, placed special emphasis on discouraging discrimination based background checks, and has held numerous open meetings on the issues. Furthermore, we at DCI Consulting have contributed to this process. For example, Eric Dunleavy wrote a treatise on background checks in an alert dated August 17, 2010. As well, I documented one of these EEOC hearings on background checks in an Alert posted on October 26, 2010 and David Cohen highlighted Dr. Michael Aamodt’s invited testimony at that hearing in which he testified:

Given the potential levels of racial/ethnic adverse impact as well as the impact on individuals whose poor credit history is due to reasons often out of their control (e.g., divorce, illness), it would seem prudent for organizations using an applicant’s credit history to do so in the context of a thorough background check that would indicate whether a poor credit history is an anomaly or is indicative of a problematic lifestyle that might impact behavior at work.’

Here’s the point. We have little doubt that background checks can have adverse impact on minorities, and agree with the EEOC that blanket exclusions based on (say) felony conviction may be unjustified depending up the nature of the felony and the description of the job. Therefore, the fact that the EEOC was embarrassed in one such case hardly means that all such cases are frivolous.

Similarly, even though above, I highlighted four embarrassing rulings against the EEOC, one needs to keep things in perspective. The EEOC has prosecuted thousands of cases over the years, and “embarrassing” rulings are the exception, not the rule.

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