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Waiting for the Dust to Settle: Mach Mining and the Future of the EEOC's Duty to Conciliate in Good-Faith Prior to Civil Litigation
November 18, 2014
In 2013, individuals filed more than 100,000 charges of Title VII violations with the Equal Employment Opportunity Commission (“EEOC” or “Commission”), thousands of which the EEOC has -- and continues -- to aggressively investigate and pursue. A problem arises, however, when the EEOC’s zealousness translates into unreasonable conciliation demands that deadlock the potential resolution of these claims prior to the filing of a lawsuit. Specifically, this aggressiveness conflicts with the EEOC’s express statutory duty to attempt to secure, in good faith, a conciliation agreement with the employer as a precondition to filing suit. See 42 U.S.C. § 2000(e)-5(f)(1). Many employers have challenged the EEOC’s filing of a lawsuit on the basis that it failed to attempt a resolution in good-faith in violation of this statutory duty.
While this precondition to litigation may appear straightforward and should inure to both the EEOC’s and employer’s benefit, Title VII’s statutory scheme does not contain any framework or instruction to determine when a good-faith conciliation effort has occurred (but failed). For this reason, federal circuits are currently split on the judiciary’s role in evaluating whether the EEOC has satisfied its statutory obligation to conciliate when faced with a lawsuit on its dockets. At one extreme, the Seventh Circuit has held that the conciliation precondition is nonjusticiable. Maching Mining, 738 F.3d 171, 172 (7th Cir. 2013) cert. granted, 134 S. Ct. 2872 (2014). In the middle, three circuits (the Fourth, Sixth and Tenth) have found that the conciliation precondition is subject to judicial review, but under a deferential standard. Serrano v. Cintas Corp., 699 F.3d 884, 904 (6th Cir. 2012). The Eighth and Ninth circuits have also subjected the EEOC’s conciliation efforts to fairly strict judicial review, but neither circuit has articulated a specific standard. See, e.g., EEOC v. CRST Van Expedited, Inc., 679 F.3d 657, 676 (8th Cir. 2012); EEOC v. Pierce Packing Co., 669 F.2d 605, 608 (9th Cir. 1982)). Finally, on the opposite extreme from the Seventh Circuit, three circuits (the Second, Fifth and Eleventh) have held that the conciliation precondition is subject to judicial review and apply a three-factor evaluation of the EEOC’s conciliation efforts. E.E.O.C. v. Agro Distribution, LLC, 555 F.3d 462, 468 (5th Cir. 2009); see also Asplundh Tree Expert, 340 F.3d at 1259; E.E.O.C. v. Johnson & Higgins, Inc., 91 F.3d 1529, 1534 (2d Cir. 1996).
Further, this “judicial doubt” has led to an expanding situation where the EEOC engages in perfunctory efforts to conciliate that seem, on their face, designed to fail. Take for example, EEOC v. Ruby Tuesday, Inc., where the EEOC demanded a restaurant that was the subject of a sexual discrimination charge, pay more than $6 million to resolve the matter and was given less than two weeks to accept. 919 F. Supp. 2d 587 (W.D. Pa. 2013). The United States Supreme Court has granted certiorari in Mach Mining to address whether and to what extent the conciliation mandate is subject to judicial review, and, while it is inevitable that the Supreme Court will attempt to resolve the current split, to what extent a new standard will take root among the lower courts remains unclear.
Regardless of the High Court’s decision in Mach Mining, though certainly heightened if the Court finds the issue to be subject to judicial review, there are strong reasons for employers to engage the EEOC upon receipt of a conciliation demand if there is any potential merit to the complaint. Bear in mind that all negotiations are confidential. Conciliation efforts, as well as the charge itself, may not be publicly disclosed without the consent of all parties involved (including the employer), until a lawsuit is filed. An obvious benefit to employers is that the alleged Title VII violations will remain confidential during the conciliation process and allow employers to maintain a positive public image while trying to resolve any issues. In addition, a reasonable counteroffer that is designed to address the allegations of the charging party solely may be useful in holding the potential lawsuit at bay and, depending on the eventual ruling in Mach Mining, offer an additional defense to the prosecution of the subsequent lawsuit.
The downside is that successful prosecution of the failure to conciliate affirmative defense may only earn the employer a brief stay in the proceedings. See, e.g., Bass Pro Outdoor World, LLC, 2014 WL 838477 at *16. Where the EEOC is pursuing a single plaintiff claim, and offering to conciliate the charge on that basis, reliance on a failure to conciliate affirmative defense may not offer much more than a “speed bump” in the proceeding. There is merit to putting the EEOC through its paces, but the ultimate value of the defense may be minimal.

Labor & Employment Law