Alert: U.S. Supreme Court Hands Down Pro-Employer Decision in Conciliation Case

Today, the U.S. Supreme Court handed down a unanimous, pro-employer decision in the long-awaited case of Mach Mining v. EEOC (U.S. 2015). Justice Elena Kagan delivered the Court’s opinion.

The case began when a woman filed a charge of discrimination with the Equal Employment Opportunity Commission (EEOC) claiming that Mach Mining, LLC had refused to hire her as a coal miner because of her sex. The EEOC investigated and found reasonable cause to believe that Mach Mining had engaged in sex-based discrimination. The EEOC then sent a letter of determination to the parties inviting them to participate in “informal methods” of dispute resolution, indicating that an EEOC employee would contact them to begin conciliation.

Whether the EEOC followed through is unclear, but about a year later, the EEOC contacted Mach Mining again by letter stating that “such conciliation efforts as are required by law have occurred and have been unsuccessful,” characterizing any further efforts as “futile.”

The EEOC then sued Mach Mining in federal court, alleging sex discrimination in hiring.

Title VII imposes a duty on the EEOC to attempt conciliation of a discrimination charge prior to filing a lawsuit. The statute provides that the EEOC “shall endeavor to eliminate [an] alleged unlawful employment practice by informal methods of conference, conciliation, and persuasion.”

Mach Mining argued that the EEOC had failed to conciliate in good faith prior to filing suit against it. The trial court agreed with Mach Mining, but the Seventh Circuit Court of Appeals reversed, holding that a court lacked the authority to review the EEOC’s decisions regarding conciliation. Other circuits held differently, leading the Supreme Court to review the case to determine “whether and to what extent such an attempt to conciliate is subject to judicial consideration.”

The Court reiterated the EEOC’s mandatory duty to eliminate unlawful employment practices through informal means, such as conciliation, calling it “a necessary precondition to filing a lawsuit.”

The EEOC responded that Title VII provided no standards by which to judge its performance of this duty. The Court disagreed, observing that “to meet the statutory condition, [the EEOC] must tell the employer about the claim—essentially, what practice has harmed which person or class—and must provide the employer with an opportunity to discuss the matter in an effort to achieve voluntary compliance.” The Court added that “[t]he appropriate scope of review enforces the statute’s requirements as just described—in brief, that the EEOC afford the employer a chance to discuss and rectify a specified discriminatory practice—but goes no further.” The Court also emphasized that the proper scope of review would maintain confidentiality: “The maximum results from the voluntary approach will be achieved if the parties know that statements they make cannot come back to haunt them in litigation.”

“Judicial review of administrative action is the norm in our legal system,” the Court concluded, “and nothing in Title VII withdraws the courts’ authority to determine whether the EEOC has fulfilled its duty to attempt conciliation of claims. But the scope of that review is narrow, reflecting the abundant discretion the law gives the EEOC to decide the kind and extent of discussions appropriate to a given case.”

This is an important case for employers. It specifically prevents the EEOC from proceeding to court without a good-faith attempt at resolving alleged discrimination prior to litigation. In this era of agency overreach, this unanimous Supreme Court decision is very good news.