On February 7, 2014, the Chicago District Office of the Equal Employment Opportunity Commission brought suit in the U.S. District Court for the Northern District of Illinois against CVS Pharmacy, Inc., claiming that a severance agreement used by the company violates Title VII of the Civil Rights Act of 1964 because it is “overly broad, misleading and unenforceable….” Equal Employment Opportunity Commission v. CVS Pharmacy, Inc., civil action no. 14-cv-863 (N.D. Ill., February 7, 2014). This ASAP will address the background to this lawsuit, describe the EEOC’s new and aggressive position toward severance agreements, and provide recommendations for employers.
Articles Discussing Title VII Of The Civil Rights Act Of 1964.
On February 7, 2014, the Equal Employment Opportunity Commission (EEOC or Commission) sued CVS Pharmacy Inc. in federal court in Chicago to invalidate the company’s standard severance agreement. The lawsuit raises concerns because it attacks language that employers commonly use in severance agreements.
In EEOC v. Mach Mining, LLC,1 the Seventh Circuit became the first federal circuit to foreclose an employer’s ability to use the implied affirmative defense that the Equal Employment Opportunity Commission (EEOC) failed to conciliate prior to bringing suit. Under Title VII, after finding reasonable cause to believe a charge of discrimination has merit, the EEOC may sue only after it “has been unable to secure from the respondent a conciliation agreement acceptable to the Commission.”2 The court of appeals held that, based on the conciliation language in Title VII and Seventh Circuit precedent, the EEOC’s approach to conciliation during the administrative charge process is not judicially reviewable and not an affirmative defense to be used against the agency. The Seventh Circuit’s holding is contrary to every other circuit that has evaluated this issue.
Goldberg Segalla LLP’s Governmental Liability, Civil Rights, and Labor and Employment Newsletterprovides a summary of the latest court decisions shaping the landscape of civil rights, government liability and employment practice. The intent of our review is to provide local governments, school districts, governmental agencies, governmental officials, private entities and insurance companies with an overview of the national decisions impacting the representation and defense of all entities that may be subject to claims involving individual civil rights and employment practices. We greatly appreciate your interest in our newsletter and ask for your commentary, as well as questions. Please feel free to share this publication with your colleagues.
The U.S. Supreme Court has agreed to consider whether severance payments made to employees who are terminated are subject to Social Security and Medicare taxes (“FICA” taxes). In United States v. Quality Stores, Inc., No. 10-1563 (6th Cir. Sept. 7, 2012), the U.S. Court of Appeals for the Sixth Circuit affirmed a district court ruling that severance payments were not wages subject to FICA taxes. The Internal Revenue Service (IRS) requested review.
In Thompson v. ABVI Goodwill Services, 2013 U.S. App. LEXIS 18680 (2nd Cir., Sept. 9, 2013, unpublished decision), the Second Circuit upheld the District Court’s dismissal of an age discrimination case. The court held that the plaintiff’s supervisor’s comments indicating the plaintiff should “retire” were insufficient to raise an inference of discrimination as it was but one comment, and separated by 20 months from the plaintiff’s termination. Likewise, comments as to where the plaintiff “should work” were ignored by the court, as they contained no age related reference.
The workplace is often incredibly uncomfortable following an employee’s claim of work-related discrimination. The employer must balance its goal of productivity and profit while maintaining employee morale and equality on the job. At times, an employer facing a charge of discrimination may feel hamstrung by the looming charge and may permit employee conduct that was otherwise sanctionable out of fear of what may be perceived as retaliation against the employee for filing a charge. But, as the recent decision out of the Seventh Circuit proves, a charge of discrimination does not provide the employee with free reign to violate work-place protocol.
In preparation for the 2013 EEO-1 survey, the Equal Employment Opportunity Commission (EEOC) has announced that all passwords have been reset for security and confidentiality purposes. The EEOC will send reporting companies notification letters that will contain new passwords. See http://www.eeoc.gov/employers/eeo1survey/index.cfm.
People often say it’s not the crime that will do you in, it’s the cover-up. In some ways, that sentiment has been applicable to retaliation claims for alleged discrimination in the workplace. At least until this past Monday, when the U.S. Supreme Court handed down its decision in University of Texas Southwestern Medical Center v. Nassar, Slip Op., No. 12-484 (U.S. Sup. Ct., June 24, 2013).
Last week, the U.S. Supreme Court issued a much anticipated ruling in a 5-4 decision which will help employers defend themselves against Title VII actions involving supervisors. In an earlier alert, we discussed the salient facts of Vance v. Ball State University, No. 11-556, Supreme Court of the United States (June 24, 2013), and the splits in the federal circuits over the definition of supervisor for purposes of vicarious liability under Title VII.
Executive Summary: On June 24, 2013, the United States Supreme Court heightened the burden of proof for employees bringing retaliation claims under Title VII by holding that employees have to prove that the employer’s desire to retaliate was the “but-for” cause for the employer’s adverse employment action.
Executive Summary: On June 24, 2013, the United States Supreme Court issued an opinion favorable to employers, determining the term “supervisor” under Title VII should be defined narrowly. In Vance v. Ball State University, the Court limited employers’ vicarious liability for workplace harassment by a “supervisor” to harassing conduct by persons with authority to take tangible employment actions (hire, fire, demote, promote, transfer, discipline) against the victim. For the first time defining “supervisor” for Title VII purposes, the Court defined it narrowly and favorably to employers. The Court split 5-4 along ideological lines with Justice Alito writing the majority opinion for the conservative wing of the Court. Justice Ginsburg was joined in her dissent by Justices Sotomayor, Breyer, and Kagan.
The United States Supreme Court recently heard oral argument in the matter of Vance v. Ball State University (Docket No. 11-556) on November 26, 2012, a case which is poised to resolve an important split among federal circuits and could reshape the scope of supervisor liability in sexual harassment and discrimination cases.