United States: What A Long Strange Year It's Been . . . The EEOCs Fiscal Year Comes To An Uncharacteristically Quiet Close

Seyfarth Synopsis: The Trump Administration has succeeded in replacing several open positions within the upper echelons of the EEOC. Employers are anxiously looking for any sign as to how this slate of leadership will put its stamp on the agency's mission and, more importantly, which employers and business practices the agency will most heavily target. But even though the names and faces are now known, what changes they will bring in terms of enforcement priorities and tactics remain elusive.

The Trump Administration is now well into its third year. And although it has recently filled most of the open positions at the headquarters of the EEOC, including a new Chair and a new General Counsel, the impact that will have on the EEOC's mission remains largely uncertain. Employers may have hoped for greater clarity in terms of this Administration's priorities for the agency. The agency's new leadership has not been vocal about its intentions, and the new lawsuits the EEOC filed in FY 2019 offer few clues.

The term of former Commissioner, Chai Feldblum, expired at the end of the last calendar year, leaving the Commission without a quorum to make major decisions. That, along with heightened political division in Washington (including a 35-day government shutdown), caused the EEOC's litigation activity to come to an unanticipated standstill. Despite this prolonged interruption, the Commission's litigation program boasted three-digit filing numbers toward the end of the fiscal year.

As we have come to expect, the EEOC ended its fiscal year with increased activity, filing 52 lawsuits during September alone compared to the total of 12 filings during the entire first quarter of 2019. But in the end, the agency's end-of-year rush and total number of filings did not come anywhere near the numbers posted last year. At the time of publication of this blog posting, the EEOC had filed 149 total cases in FY 2019, which includes 141 merits lawsuits and 8 subpoena enforcement actions. This total number of filings is significantly less than the last two years (see here and here), and is more in line with the drop off in filings that we saw in FY 2016 (see here).

Cases Filed By EEOC District Offices

In addition to tracking the total number of filings, we also keep a close watch on which of the EEOC's 15 district offices are most actively filing new cases. Some districts tend to be more active than others, and some focus on different EEOC priorities. So the where of EEOC filings not only shows which areas of the country are most heavily targeted, but also offers a clue as to which priorities the EEOC is focusing on for the coming year. The following chart shows the number of filings by EEOC district office.

The most noticeable trend of FY 2019 is the marked decrease in coast-to-coast filings that we have seen compared to past years. Leading the pack in new filings are the Charlotte and Philadelphia district offices, with 15 and 14 filings respectively. The Chicago district office is usually at the head of the pack, but has been bumped to the shared number three spot along with New York and Houston at 12 filings each. The numbers for the other district offices are also fairly close to on par with what we have come to expect. This year, the Indianapolis, St. Louis, and Phoenix district offices posted comparatively mid-range numbers. This middle of the pack performance is fairly typical of those district offices. The Dallas and Los Angeles district offices were outliers on the lower end of the spectrum. Los Angeles filed just 8 new lawsuits this year compared with 17 last year, and Dallas filed just 3 compared to 10 last year.

Analysis Of The Types Of Lawsuits Filed In FY 2019

Each fiscal year we also analyze the types of lawsuits the EEOC files, in terms of the statutes and theories of discrimination alleged, in order to determine how the EEOC is shifting its strategic priorities. But here again, the numbers – when considered on a percentage basis – are largely in line with prior years, confounding attempts to ascertain where the new leadership will focus the agency's attention in FY 2020 and beyond. The graphs set out below show the number of lawsuits filed according to the statute under which they were filed (Title VII, Americans With Disabilities Act, Pregnancy Discrimination Act, Equal Pay Act, and Age Discrimination in Employment Act, etc.) and, for Title VII cases, the theory of discrimination alleged.

Although the total number of filings is down across the board, when considered on a percentage basis, the distribution of cases filed by statute remained broadly consistent compared to FY 2018. Title VII cases once again made up the majority of cases filed, making up 60% of all filings (as compared with 55% in FY 2018). ADA cases also made up a significant percentage of the EEOC's filings, totaling 37% this year, as compared to 42% in FY 2018. This too is fairly typical. There were only 7 age discrimination cases filed in FY 2019, which is a relatively small number. But again, when compared on a percentage basis, this does not represent a large shift in focus for the EEOC (5% in FY 2019 on par with the 5% in FY 2018).

Change At The Top

By any measure, FY 2019 was a "transition" year for the EEOC. The Commission's leadership team include five members: the Chair, Vice Chair, and three Commissioners, collectively appointed by the President and approved by the Senate. Of the five Commissioners, no more than three may be members of the same political party, a requirement promising bipartisanship outliving administration changes. Janet Dhillon, the current EEOC Chair, was originally selected for that role by President Trump in June 2017, but was not approved by the Senate until FY 2019, taking office on May 15, 2019. She joined two Obama-appointed Commissioners, Victoria Lipnic and Charlotte Burrows, a Republican and a Democrat respectively. Two Commissioner positions remain vacant.

President Trump had originally re-nominated former Commissioner Chai Feldblum for a third term. As a bipartisan federal agency, it is customary for the President to nominate Commissioners who are members of both parties. However, Feldblum was the first openly gay member of the Commission, and a champion of LGBT rights. Although President Trump re-nominated Feldblum, she was not confirmed by the Senate due to her perceived views on those issues, leading to her term's expiration on January 2, 2019. The EEOC was therefore left with only two Commissioners until Dhillon took her seat in May.

Three acting Commissioners are required for the EEOC to exercise its powers. Between the expiration of Feldblum's term in January and Dhillon's appointment nearly four months later, the Commission lacked a quorum, thereby hindering its ability to act. This may, in part, explain the drop in merits suits and subpoena enforcement actions in FY 2019. The government shutdown, which lasted from December 22, 2018 to January 25, 2019, may also have played a part. Upon Dhillon's appointment, and despite two remaining vacancies, the three-member Commission satisfies quorum and has since resumed full operations at the EEOC.

Appointment of the new Chair came on the heels of thirty business organizations, including the U.S. Chamber of Commerce and American Trucking Associations, imploring Congress and the President to confirm then nominee Dhillon with expediency. Absent a quorum, the EEOC was unable to respond to newly issued court decisions and regulations impacting employers in costly ways. Among them was the March 4, 2019 decision issued by Judge Tanya Chutkan of the U.S. District Court for the District of Columbia, which revitalized the Obama-era requirement that employers report W-2 wage information and total hours worked for all employees by race, ethnicity, and sex within 12 proposed pay bands (EEO-1 Component 2 pay data).

Now that the EEOC has a quorum again, we may be starting to glimpse how things may start to change at the agency. On September 11, 2019, the EEOC announced that it is not renewing its request for authorization to collect Component 2 pay data because of the burden that collection imposes on employers. Although this change in policy came too late to prevent employers from having to submit such data this year (by today), this may be one of the first indications employers have seen as to how the new leadership may shake things up in years to come.

Implications For Employers

Commissioner Lipnic's term expires on July 1, 2020 which could result in a loss of quorum again if she is not re-nominated and confirmed for her position, or otherwise replaced by a Trump nominee. This leaves open the possibility of three Commissioner appointments by President Trump during the upcoming election year. We fully expect that the EEOC's future composition and the broader political climate will have major implications for the Commission's enforcement priorities.

We will continue to monitor these changes closely and keep readers apprised of developments. Our annual comprehensive analysis of trends in EEOC litigation will be published at the end of the calendar year. As always, we will keep abreast of EEOC data amid the ever-changing political milieu, and share lessons learned from FY 2019 to carry employers through the new year.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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