In December 2013, we reported on the Seventh Circuit’s controversial decision in EEOC v. Mach Mining, in which the Court exacerbated the already existing split amongst federal appellate courts regarding the EEOC’s obligation to engage in conciliation of discrimination claims before filing a lawsuit. Last week, the Supreme Court agreed to address whether courts can review the EEOC’s pre-suit conciliation efforts by granting certiorari to hear the Mach Mining case and, hopefully, provide a uniform standard.
In its Mach Mining decision, the Seventh Circuit readily acknowledged its disagreement with other appellate courts that had previously confronted this issue, dating back to the 1970s. Blazing its own trail and rejecting prior case law, the Seventh Circuit ruled that the EEOC’s conciliation efforts were not subject to review by the courts. The Seventh Circuit ruled that the EEOC has broad discretion in resolving discrimination claims, including the right not to seek to negotiate a resolution of a claim before filing a lawsuit in federal court.
Prior to the Seventh Circuit’s decision, federal courts had generally held that the EEOC’s conciliation process was subject to review by a court, but the type and level of scrutiny was dependent upon the circuit. In some circuits, conciliation efforts are reviewed to determine whether the EEOC acted in “good faith” or “reasonably.” Whereas, other courts apply a more demanding three-factor test that addresses whether the EEOC provided information to the employer and engaged in reasonable settlement discussions. Still other courts have not adopted a clear standard of review. By agreeing to hear the case, the Supreme Court is expected to resolve the current split and provide employers with much needed clarification and certainty regarding the EEOC’s obligation to conciliate discrimination claims before filing suit, and employers’ corresponding ability to rely on the EEOC’s failure to conciliate as a defense.
The Supreme Court’s decision will affect how aggressive the EEOC will be or continue to be during the conciliation process. The way the EEOC currently approaches conciliation seems to depend on where the dispute is located. If the dispute arises in a jurisdiction which applies the highly deferential “good faith” standard, the EEOC has increasingly adhered to an aggressive “take it or leave it” settlement position. In those jurisdictions where the EEOC’s actions have been subject to scrutiny, like in the Eighth Circuit where the EEOC was hit with recent $4.7 million attorneys’ fee award (EEOC v. CRST Van Expedited, Inc.), the EEOC may be more likely to share information during the conciliation process. The Court’s decision in Mach Mining and its expected adoption of a uniform standard will unquestionably have a significant impact on employers’ defense of discrimination claims across the country.
The Supreme Court will hear the Mach Mining case during its October 2014 term, and will likely not issue its decision until the first quarter of 2015, at the earliest.