EEOC Feels the Pain of Two Employer-Friendly Decisions

The Equal Employment Opportunity Commission (EEOC) had a rough week in early August resulting in two decisions in favor of employers.

We previously reported on the first lawsuit, EEOC v. CRST Van Expedited, Inc. (N.D. Iowa 2013), where the court ordered the EEOC to pay CRST’s $4.69 million in attorney fees and costs as a sanction for making “unreasonable or groundless” claims. The court cited the agency’s failure to properly investigate the claims before filing suit and its failure to exhaust administrative remedies as reasons supporting the decision.

In the second case, EEOC v. Freeman (D. Md. 2013), the language the court used to describe the EEOC’s key witness calls to mind the “trash talking” more often heard at a professional wrestling match. The EEOC sued Freeman alleging the company’s policy of using credit and criminal background reports in making hiring decisions had a discriminatory effect on African-American and male applicants. To prevail in the case, the EEOC was required to provide statistical data that sufficiently showed the employer’s practice caused applicants to be denied jobs or promotions because they were members of a protected group.

The EEOC’s primary witness presented what he claimed was evidence that proved the EEOC’s allegations. In its scathing opinion, the court stated the expert “deliberately ignored” data and “cherry-picked” his information to manipulate the results which it deemed “an egregious example of scientific dishonesty.” The court ruled in Freeman’s favor finding the EEOC’s “laughable” expert testimony contained a “mind-boggling number of errors” which rendered it “completely unreliable” and “worthless.” Further, the court acknowledged, “Careful and appropriate use of criminal history information is an important, and in many cases essential, part of the employment process of employers throughout the United States.”

The EEOC has been particularly aggressive of late in pursuing employers for their use of credit and criminal history information in employment decisions. In Freeman, the court makes clear that showing that criminal or credit information has been used is not sufficient to support a disparate impact discrimination claim. The court further observed that the EEOC itself conducts criminal background investigations for all employees and runs credit checks on 90 percent of its employees.