EEOC’s 2019 Efficiency is Both Good News and Concerning News for Employers

Last week, the U.S. Equal Employment Opportunity Commission (EEOC) issued its FY 2019 Performance Report, touting the agency’s successes and statistics for its fiscal year ending September 30, 2019 – and the details reported are nothing to sneeze at. Last year, the EEOC reported a 12.1% reduction in its charge “inventory,” meaning that year-over-year the agency has disposed of thousands of pending discrimination and retaliation charges, some of which had sat dormant for years. This reduction puts the EEOC’s current charge inventory at 43,580 – the lowest inventory in 13 years.

Charges based on retaliation for engaging in protected conduct (i.e., where an employer takes an adverse action against an employee for complaining about harassment or discrimination) were most common, followed by disability, race, sex and age discrimination charges. Perhaps surprisingly, given the media coverage surrounding the #MeToo movement, only 10% of the charges filed with the EEOC alleged sexual harassment.

Moreover, while the EEOC saw an 11% increase in the number of inquiries to its electronic charge filing system, the agency claims that its pre-charge counseling efforts actually reduced the number of formalized charges filed in FY 2019 by nearly 5%. In other words, the EEOC saw over 123,000 charge-related inquiries, of which only a fraction (just under 31,000) became formalized discrimination charges. The EEOC credits this reduction in formalized charges to its efforts in helping potential claimants make “informed decisions” about their claims through pre-charge counseling.

For employers, the EEOC’s FY 2019 annual report is certainly welcome news. The significant reduction in the agency’s overall backlog of cases and its smaller realization of formalized charges last year seem to indicate that the overall employer liability risk is likewise decreasing.

As with all raw statistics, however, there is more to these numbers than meets the eye.

Indeed, it is good to see that the EEOC is working to help employees understand the consequences of filing a charge against their current or former employers. These efforts have apparently resulted in fewer baseless charges that employers are forced to defend. But with the reduction in overall charge realization, those charges that are formalized are more likely to be meritorious. This is borne out by the numbers. The EEOC touts a 95% success rate in its litigation (though, that combines both success at trial, as well as matters that are settled during litigation), and reports securing over $486 million in damages for victims of discrimination in FY 2019. This represents increased overall success in litigation, and only a 3% decrease in year-over-year monetary recovery from FY 2018, demonstrating the EEOC’s improved efficacy in charge intake, investigation, conciliation and litigation management.

So what’s the rub?

While employers can take solace in the significant reduction in overall charges filed with the EEOC, those that are filed and formalized are more likely to be pursued by the agency. In other words, going forward, employers who receive an EEOC charge should take it seriously, as the likelihood the EEOC will find merit in the claim is higher today than it was a year ago. Moreover, the EEOC is pushing along the investigation process for both pending and new charges, requiring faster response times to information requests, and not shying away from utilizing its subpoena power to obtain documents and information.

As an agency, the EEOC is charged with administering, implementing and enforcing Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Equal Pay Act, the Americans with Disabilities Act, and the Genetic Information Non-Discrimination Act. An employer receiving a charge from either the EEOC or a state or local fair employment practices agency should involve legal counsel to assess the merits of the claim and discuss strategy about an appropriate response.

This is more true than ever in light of the agency’s most recent annual performance report.