Human Resources News & Insights

Tables turned: Employer wins settlement from EEOC


Good news for employers: A federal judge has slapped down the EEOC for pursuing a bias case the agency knew it couldn’t win.

And it wasn’t just a verbal rebuke. Judge Hugh Brenneman Jr. ordered the EEOC to pay Michigan-based staffing firm Peoplemark, Inc. more than $751,000 in attorney’s and expert witness fees.

It’s a complicated case, but here are the high points:

The EEOC, which has been making noises about employers discriminating against applicants with criminal histories, charged the company with having a blanket policy against hiring anyone with such a record.

Peoplemark denied it had such a policy — and, indeed, proved that of the 286 individuals the EEOC represented in the suit, 22% were actually hired.

So much for the blanket ban on employees with criminal histories. But even after it had learned its charge was without merit, the agency continued to pursue the matter — for two years.

EEOC finally gave up when it admitted it had “no statistical expert to rebut” Peoplemark’s evidence.

Shoot now, aim later

The employer subsequently sued for attorney’s fees and other costs, maintaining that the EEOC “deliberately caused Peoplemark unnecessary delay and expense in a very time consuming and complex case.”

The judge agreed, chiding the agency for not digging deeply enough into the facts of the case. And when it was proven the company didn’t have a categorical prohibition on hiring people with criminal records, “it was certainly unreasonable to continue this burdensome litigation beyond this point,” the judge ruled.

The court further scalded the agency for its overall handling of the matter: “As the various hearings and orders throughout this matter document, the EEOC failed to adequately manage the prosecution of this case from the beginning.”

Pretty strong stuff. Perhaps this decision will make the EEOC a little less eager to bring questionable claims against employers in the future — changing its MO from what some observers have characterized as “Ready … fire … aim.”

Cite: EEOC v. Peoplemark, Inc. To read the full decision, go here.

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  1. Starting now, and going forward, I will reference the “EEOC v. Peoplemark” ruling in all Charge Response’s that I do. I have yet to respond to a charge or RFI that there has been any liability to the company….only a disgruntled employee and (more times than not) an overzelous “investigator” looking to find fault……

    It does keep me employed though…….yeah for idiots!

  2. Yea for the common people who overcame the massive engorged juggernaut – the US Government gone wild. This is so typical.

    Another case of lazy entitled government employees looking to get off on cases with no merit…simply because “they can”. I am sure it won’t end here…..the president ignores rules he does not like unlike the rest of us who must obey or be jailed.

    Thank you judge Brenneman for standing up.

  3. Up & At'em says:

    Good Work Peoplemark! Maybe the EEOC will follow a fact based investigation and not a typical witch hunt. All a person has to do is make a complaint with no basis and the employer is put on trial. Hopefully this decision will strike a “fair” balance of only factula information on both sides. If an employer is discriminating, they should be held accountable. If not, leave them alone.

  4. Yay! This is a wonderful start to the dismantling of a very lopsided and biased justice system. I feel they shjould have been granted punitive damages as well. If the punitive damages were high enough they could have, possibly, shut these clowns at the EEOC down.
    I know that there really are valid cases of discrimination but why shouldn’t an employer have the right to discriminate as long as there are no racial/sexual/age related overtones.

    Judge Brenneman for President!

  5. Whattayamean says:

    “But even after it had learned its charge was without merit, the agency continued to pursue the matter — for two years.

    EEOC finally gave up when it admitted it had “no statistical expert to rebut” Peoplemark’s evidence.”

    I hope somebody at the EEOC got the boot for this. It’s a pure case of a bureaucracy out of control. They persued this for 2 additional years because (1) they could, (2) it’s job security for the bureaucrats and (3) they apparently had nothing else to do. This is a gross waste of taxpayer money. The EEOC’s budget should be cut to the bone.

  6. Read the book ‘Job Killers’ by Dan Sinas. One of the issues the book exposes is how our regulatory system actaully encourages employee lawsuits and promotes unjustifiable settlements to undeserving employees. It also puts forth a very compelling idea regarding how the EEOC ought to be restructured to become an advocate of justice for both employees AND employers, not just a government sponsored system of legalized extortion from companies.

  7. As happy as I am that someone finally called out the EEOC on their unethical practices, I’m sickened by the fact that we, as tax payers, are the ones who will end up footing the bill for the 750+K that they will have to pay Peoplemark.

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