The Myth of Gladiators: How Trial Lawyers Duped Civil Rights Advocates and Democrats

The Civil Rights Act of 1991 (CRA 1991) spawned a new breed of trial lawyer–i.e., “gladiators” who, in the most Machiavellian sense, exploit the language of civil rights and equal employment opportunity (EEO) for personal profit. Unfortunately, Democrats and social advocates advancing the rights of female, African-American, Latino, and even GLBT workers still do not realize they’ve been tricked and used.

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The Gladiator Spiel

The Colorado House Judiciary hearing for HB-1136 on February 14, 2013 started late, and proponents and opponents alike had camped out all day waiting to testify. Lobbyists lined the hallways and the hearing room itself was packed with civilian civil rights advocates, union representatives, business groups, and defense lawyers. Everyone was exhausted, hungry, and weary . . . on purpose: HB-1136’s House sponsors saved this bill for last, allowed unlimited testimony on other bills earlier in the day, and then confined testimony on HB-1136 to three (3) minutes, allegedly for everyone’s personal comfort.

HB-1136’s chief proponents and public cheerleaders were Representative Joe Salazar (D) in the House and Morgan Carroll (D) in the Senate.  Both Salazar and Carroll are trial lawyers who represent EMPLOYEES in litigation against EMPLOYERS, and thereby stood to profit personally from their legislation. In Salazar’s lengthy firm biography, he underscores his “roots in civil rights” and emphasizes his employee-focused litigation practice. Likewise, within months of HB-1136’s passage, Morgan Carroll’s law firm–i.e., late night TV-hawking trial lawyer firm, Bachus & Schanker–unabashedly announced the addition of a longtime plaintiff-side employment lawyer, commenting in the local business journal:

The firm has a top-notch personal injury practice and expanding into this area of employee rights is logical,” Schanker said.

To trial lawyers, personal injury and “employee rights” go together.

Thus, drafted by trial lawyers for the benefit of trial lawyers, HB-1136 sought to import the damages and remedies available under federal employment discrimination law–e.g., CRA 1991’s remedial scheme of capped compensatory and punitive damages, and more importantly, automatic attorneys’ fees to plaintiffs–into Colorado’s analogous anti-discrimination statute, which had far more limited remedies. Because of the limited remedies under Colorado law, aggrieved employees and their trial lawyers were forced to “resort” to the federal enforcement system–namely, the EEOC and federal courts that, as litigators on both sides of the bar would agree, are far more likely to throw out non-meritorious claims before trial. HB-1136, therefore, sought to replicate CRA 1991’s remedies in a friendlier litigation forum. Ostensibly, however, HB-1136 was intended to “bridge the gap” between federal and state remedies, and provide greater “relief” to “victims” of discrimination and harassment perpetrated by employers covered under Colorado, but not federal law–i.e., employers with less than 15 employees.

In their brief testimony, attorneys from the Colorado Trial Lawyers Association (CTLA) and Plaintiff Employment Lawyers Association (PELA) used precious seconds to talk about their “commitment” to representing victims. They also complained about the high summary judgment dismissal rates in federal court. Civil rights advocates testified that discrimination is bad and must be abolished. Even though non-profit organizations have experienced an appreciable uptick in employment litigation, the Colorado Non-profit Association (CNPA) offered the least substantive testimony of all, supporting the bill on the grounds that their member organizations stand against discrimination–of course they do! Several union-funded lobbying groups testified that employers must be punished for discriminatory behavior, and HB-1136 would do the trick . . . obviously ignorant of the range of remedies already in place for the majority of Colorado’s employees.

And then Rachel Martinez, HB-1136’s poster child, testified about the sexual harassment she allegedly endured at the hands of a small employer. She stated that despite this allegedly egregious workplace abuse, she could not find a CTLA or PELA attorney to champion her case because of the limited remedies available under existing Colorado law. Unflinchingly, she stated that attorney after attorney declined to take her case, explaining that had she worked for a larger employer (i.e., 15+ employees), her case would be far more attractive to them because it would be worth more MONEY. Like those who testified before her, she urged Colorado lawmakers to “sweeten the pot” by increasing the damages available against all employers under state law, including employers already covered under Title VII and CRA 1991.

By the time HB-1136’s opponents were up, the Chair of the Democrat-controlled committee again stressed the importance of brevity.  And so, with cartoon-like speed, HB-1136’s opponents (e.g., Chambers, NFIB, defense lawyers associations and tort reform advocates) prattled off the standard arguments: bad for small business, reduced regional competitiveness, stifled job creation. When my turn came, I hurriedly spoke of my EEOC and social work background, commitment to EEO, and my litigation career representing employers. I tried to explain that schemes like HB-1136 had been around since CRA 1991 and had simply not worked.  But, a committee member, a fellow Democrat, interrupted.  Because I represented employers, he stated (paraphrased), I must stand against employee and civil rights.  Despite my background, I’d been branded and dismissed.

In that instant, I realized how brilliantly trial lawyers had duped Democrats and civil rights advocates into buying the thrust of HB-1136 and its predecessor, CRA 1991: namely, that as a matter of public policy, providing incentives for trial lawyers to prosecute employers for discrimination and harassment allegations would help solve the problem of inequitable workplace opportunity.  Stated another way, trial lawyers convinced otherwise well-meaning civil rights advocates that what’s good for trial lawyers is also good for THEM.  In reality, however, twenty-five years of data paint a diametrically different picture.

CRA 1991: The Genesis of the Gladiator Myth

CRA 1991 passed quickly and quietly in November of 1991 with surprisingly little legislative history.  In fact, after the major provisions of the bill had already been agreed to, legislators haggled to recreate the legislative history of the bill in the public record, ostensibly to guide judicial interpretation. Given HB-1136’s legislative history, however, I have little doubt that CRA 1991 was the byproduct of closed-door negotiations between lobbyists for the Chambers, the National Federation for Independent Business (NFIB), and the National Trial Lawyers Association (NTLA), some of the most powerful lobbies in Washington, D.C.  After all, when I arrived to testify against HB-1136 in February of 2013, an attractive lobbyist from the Colorado chamber pulled me aside to tell me that “they” had already agreed to HB-1136’s amendments . . . the hearing itself, she made clear, was simple theater.

CRA 1991’s passage quickly followed a critical juncture in America’s civil rights history: the Clarence Thomas-Anita Hill scandal. As depicted surprisingly well in the HBO drama, Confirmationthe hearing (and the hearing process itself) inspired feminist rage all over the nation, especially considering that Clarence Thomas perpetuated much of his boorish, harassing conduct while Chair of the EEOC–i.e., the agency charged with “protecting” women from such harassment.  The hearing was a national outrage, and Congress realized that it must to SOMETHING, and trial lawyers had “something” up their sleeve.

Trial lawyers correctly pointed out how little progress we’d made in the March toward EEO, as evidenced by the Thomas-Hill hearings themselves and department of labor reports. The problem, they argued, is that an under-funded EEOC simply could not handle the volume of discrimination issues infecting our workplaces. In short, the EEOC needed help. Of course, they wanted to help, but the limited remedies then-available under Title VII (e.g., backpay, reinstatement, bench trials) hardly made taking discrimination cases “worth it” for them under their standard contingency fee arrangement. If, however, Congress modified Title VII to allow the recovery of compensatory (e.g., pain, suffering) and punitive damages, jury trials and attorneys’ fees, they could act as mini “Attorneys General” to help an under-funded EEOC stamp out discrimination once and for all.  Congress bought it and passed CRA 1991 quickly, effectively PRIVATIZING the enforcement of Title VII.

The “gladiator myth”–i.e., trial lawyers masquerading as civil rights proponents–was born.  And unfortunately over the past 25 years, the “gladiator myth” grew and spread into other social legislation designed to help PEOPLE, namely, the Affordable Care Act (ACA).  In passing this historic legislation, trial lawyers lobbied hard to ensure that tort reform protections would not apply to the ACA’s new species of health care provider–i.e., the “Accountable Care Organization” (ACO). Health care attorneys have already commented that the lawsuits under the ACA will metastasize, as more trial lawyers figure out how to make money under this new legislation.

Confessions of a Recovering Gladiator

People Thomas Hill

Like most other feminists, I spent October of 1991 glued to the television watching the Thomas-Hill hearings unfold . . . and when I was not watching the hearings, I was working as a domestic violence counselor at one of Chicago’s biggest shelters. During this period, feminist rage and righteous indignation coursed through my veins and arteries like glucose, and hardened my resolve to dedicate my career to striving for EEO, especially for women like me (i.e., youthful tribalism).

Shortly thereafter, I applied to Washington University’s prestigious Brown School of Social Work, and based on a scholarship essay about the interplay between societal devaluation and violence (observations that still ring true today), I received the substantial Roger Baldwin fellowship for civil rights. To enhance my “toolbelt,” I gained admission to Washington University’s law school a few months later, and again, found myself focusing on classes in labor and employment law, criminal justice, and civil rights.  The course in Employment Discrimination, however, literally changed my life: perhaps because I completely “geeked out” over her class, the professor opened several doors within the St. Louis office of the U.S. Equal Employment Opportunity Commission (EEOC) and the St. Louis plaintiff’s bar.  And upon completing my JD/MSW in 1997, those open doors guided me to my first law job as a Trial Attorney with the EEOC in Denver, Colorado.

Make no mistake: as a freshly-minted EEOC Trial Attorney, I considered myself a GLADIATOR in the war on discrimination and more pointedly, those bastard employers who perpetuated it.  After all, I’d been well-indoctrinated into the gladiator rhetoric through studying CRA 1991 and working with the EEOC and St. Louis plaintiff’s employment bar in law school. Thus, I believed in the power of litigation to change hearts and minds about civil rights and equal opportunity. I believed in their Victim/Villain paradigm in which employees are “victims” and employers are “villains.” I believed that attacking discrimination through litigation would yield more employment opportunities for Title VII’s intended beneficiaries.  And, I projected my own passion about EEO issues onto my colleagues at the EEOC and the Denver plaintiff’s bar, assuming that they fundamentally cared about these issues as much as I did. (They do not).  Indeed, at the outset of my fledgling legal career as an EEOC Trial Attorney, I also believed that the plaintiff-side employment lawyers fulfilled a useful social purpose by prosecuting the numerous cases for which an underfunded EEOC simply had no resources–i.e., the crux of the gladiator myth.

Experience and evidence, however, would prove otherwise . . .

Deconstructing the Gladiator Myth

The EEOC and The Gladiator Myth

The term “Gladiator” comes from a scholarly article written by respected law professors Margo Schlanger of University of Michigan Law School and Pauline Kim of Washington University in St. Louis School of Law, The Equal Employment Opportunity Commission (EEOC) and Structural Reform of the American WorkplaceIn their lengthy analysis, Schlanger and Kim searched for an analytic model to explain the EEOC’s prosecutorial conduct: did the EEOC behave like “gladiators” by prosecuting complicated cases in the public interest? Or, did the EEOC behave like “collaborators,” working within institutions to effectuate social change?

Neither, Schlanger and Kim found. EEOC prosecutions neither resembled hard-fought gladiator battles nor collaborative problem-solving; instead, EEOC enforcement boiled down to a bureaucratic, “managerialist” response that is largely “cosmetic in nature,” not substantive.

Given my experience at the EEOC, I could not have agreed more. We had arrived at the same conclusions through different routes.  Schlanger and Kim, however, offered little insight into HOW the EEOC’s enforcement devolved into a bureaucratic wasteland of rote, managerialist responses. But, through my lens–a lens also shaped by different disciplines and personal experience–the reason for the EEOC’s failure seemed obvious:

Complete Misalignment Between Mission and Methods

Each November, the EEOC releases its annual Performance and Accountability Report (PAR), which describes the agencies progress toward, inter alia, “Enforcing the Law More Effectively.”  For at least the past five years, the EEOC leadership has touted its historic monetary collections from employers as evidence of “Enforcing the Law More Effectively,”

This point merits repetition: to EEOC Commissioners and by extension, field personnel, the amount of MONEY collected from EMPLOYERS ostensibly shows that the EEOC is effectively enforcing Title VII.  Of course, Title VII’s architects codified the EEOC’s mission in statute itself: to ensure equal opportunity for all American workers and to eliminate workplace discrimination “through informal efforts of conference, conciliation and persuasion.” For social scientists experienced with statistics, research study design, and governmental reports, determining whether the EEOC was “enforcing the law more effectively” (i.e., promoting opportunity and reducing discrimination) could easily have taken into account historic job segregation and advancement patterns gleaned from the EEOC’s own EEO-1 data, Bureau of Labor Statistics (BLS) reports, EEOC charging data, Census data re wealth distribution, etc.

Instead, MONEY exacted from employers became the “metric that matters” at the EEOC after CRA 1991. By defining MONEY as the measure of its efficacy, the EEOC effectively recalibrated its entire enforcement machine to spit out monetary settlements, regardless of whether the allegations of discrimination or harassment have merit or not. In 2013, EEO Legal Solutions undertook a nation-wide survey of HR practitioners, employment lawyers, and EPL adjusters (“practitioners”) to find out what EEOC mediators SAY behind closed doors to make them PAY in the EEOC’s “successful” alternative dispute resolution program.  After all, the EEOC protects its personnel and processes under an iron veil of selectively-invoked confidentiality and “government deliberative process” privilege. Thus, this study marked the first effort to EXPOSE what employers experience in a law enforcement process literally shrouded in secrecy.

The results were alarming.  Over 80% of practitioners reported that the EEOC mediator stressed “cost-of-defense,” regardless of charge merit. The EEOC is well aware that employers settle EEOC charges not out of guilt or recognition of wrong-doing, but rather, to avoid the exorbitant cost of proving they did not thing wrong in the first place.  But it gets worse: the survey showed that after emphasizing their defense cost dilemma, EEOC mediators then brandished EEOC enforcement weaponry to scare employers into higher cost-of-defense settlements, routinely threatening reasonable cause determinations, expensive systemic investigations, and even prosecutions.  As we pointed out, these threats are outrageously disingenuous: EEOC mediators know (or should know) that if any of those outcomes were likely under the EEOC’s longstanding Priority Charge Handling Procedures (PCHP), the matter would not have been routed to mediation in the first place.  In effect, this study validated much of the bad behavior I’d witnessed among EEOC personnel during my tenure–namely, threatening the use of federal enforcement power to effectuate a private settlement over UNSUBSTANTIATED allegations. When MONEY is the metric that matters, the “successful” EEOC personnel churn big settlements and LIE, under the absolute protections of confidentiality and “deliberative process privilege,” to accomplish their objectives.

Naturally, trial lawyers profit from this “alignment of interest” with the EEOC, reveling in watching EEOC personnel shake down employers for monetary settlements of which they will take 33% to 50% under a standard contingent fee arrangement. Of course, trial lawyers share the EEOC’s interest in maximizing MONEY for “victims” (i.e., accusers), and have found a kindred spirit in EEOC Chair Jenny Yang, a longtime employee-side employment lawyer from California.

The Gladiator Model and the Progress Toward EEO

The EEOC prosecutes less than .2% of its Charge intake, roughly 150 cases per year out of nearly 90,000 new charges. Each year, the EEOC finds “reasonable cause” to believe discrimination, harassment, and/or retaliation have occurred in around 3.5% of all charges, and “no reasonable cause” in over 66% of charges. Even when the EEOC finds “no reasonable cause” that discrimination occurred, however, “aggrieved employees” still have the right to hire a trial lawyer and sue their employer in federal court. Indeed, that was the whole point of CRA 1991: to help an under-funded EEOC deliver on Title VII’s promises through PRIVATE prosecution of alleged Title VII violations.

Twenty-five years later, over 99% of Title VII enforcement now takes the form of PRIVATE LITIGATION against employers, not GOVERNMENTAL REGULATION.  In the aftermath of CRA 1991, Employment Practices Liability Insurance (EPLI) mushroomed into a booming risk management product to help employers mitigate the costs and risks of discrimination disputes; whereas only a handful of carriers offered EPLI in the 1990’s, EPLI now forms part of every bundled business policy and covers the majority of employers’ defense costs and indemnity risks. Today, EPLI carriers stress early settlement to avoid defense costs, making discrimination disputes less about vindicating civil rights than they are about the simple transfer of funds between insurance carriers and trial lawyers.  And trial lawyers like it that way.

But the question civil rights and EEO advocates should be asking is this:

has this scheme of privatized EEO enforcement (i.e., CRA 1991) advanced the March to end discrimination and level the playing field?

Starting in 2013, in anticipation of Title VII’s 50th anniversary on July 2, 2014, EEO/AA experts at Biddle Consulting Group in California and I started asking this and even a more basic question: if CRA 1991 had proven effective, what outcomes could we expect to see? What are the measures of our progress toward EEO?  And so, we daydreamed about and then measured:

  • Historic Job Segregation Patterns. Biddle’s Dan Kuang, PhD analyzed the EEOC’s own EEO-1 data from 1996 [first available year] to 2012 to determine the racial and gender composition of several major job categories at opposite ends of the pay scale.  Dr. Kuang found that African-Americans, Latinos, and Women remain concentrated in the lowest paying positions, while Whites and Asian Americans still occupy the top rungs of the status and pay ladder.
  • Progress Toward Achieving Top Jobs.  Dr. Kuang also measured the pace and trajectory of progress toward achieving top “Official/Manager” jobs. He discovered that Asian Americans have made significant progress in this job category, whereas the progress of Women and Latinos depicts a long flat line. Unfortunately, African-Americans have lost ground in the march to the top since 2008.
  • Impact of Unemployment.  Quarterly BLS data continues to show that unemployment hits the African-American and Latino communities the hardest, whereas Asian Americans are less likely to become unemployed than Whites. BLS data also shows that Women, African-Americans, and Latinos spend more weeks on unemployment, thereby suggesting greater difficulty becoming reemployed.
  • International Leadership.  The United States ranks 69th behind many developing nations with respect to the number of female leaders in government.
  • Government Employment.  According to the EEOC’s own reports, African-Americans have not obtained FEDERAL employment in numbers commensurate with their overall workforce availability, thereby suggesting hiring discrimination in the federal sector.

Read the full analysis HERE.  Against these reasonable benchmarks, CRA 1991 has simply not increased opportunity for most of Title VII’s beneficiaries, nor has it reduced the number of workplace discrimination claims.  And according to a more recent Gallup poll, 60% of African-Americans feel like they still suffer discrimination in HIRING compared to other racial groups . . . and they’re right.

How the Gladiator Myth Distorted Our EEO Focus

Twenty-five years later, we have very little progress to show for CRA 1991. Contrary to trial lawyer promises in 1991, CRA 1991 has not improved OPPORTUNITY for Women, African-Americans, or Latinos, despite the fact that a substantial amount of money has changed hands among employers, insurance carriers, and lawyers. Likewise, CRA 1991 has not reduced discrimination allegations, nor improved the workplace climate.  As a matter of fact, CRA 1991 has likely provided incentives for businesses to invest in TECHNOLOGY to accomplish job functions rather than hire HUMANS. After all, a robot may break down, but it can never sue.  More HERE.

Thus, why did CRA 1991 fail to move the needle toward better opportunity (e.g., more jobs, more promotions, equal pay) for Title VII’s intended beneficiaries?

Again, gladiator GREED helps answer that question:  while data suggests that discrimination in HIRING, PROMOTION, and PAY against African-Americans, Latinos, and Women remain rampant, trial lawyers disfavor such cases. They are complicated and difficult to prove; punitive and compensatory damages are harder to get; and most importantly, because of the legal “duty to mitigate,” hiring, promotion, and even pay cases yield much smaller jackpots.

TERMINATION cases, by contrast, allow trial lawyers to (a) pile on discrimination, harassment, and retaliation claims out of the same factual nucleus; (b) make big plays for pecuniary and compensatory (e.g., pain, suffering) damages; (c) recover “frontpay;” and (d) tell the familiar, tired tale of villain employers and victim employees. TERMINATION cases are easier and far more profitable, with far less WORK.

In partial recognition that TERMINATION matters (not charges alleging discrimination in HIRING, PROMOTION, and PAY) had overtaken its INTAKE of charges, EEOC commissioners voted on April 4, 2006 to switch the entire enforcement focus from “cohort discrimination” (i.e., individual instances) to “systemic discrimination,” namely, employer practices that broadly impact many employees, especially in HIRING.  The EEOC subsequently (and consistently) has announced that eliminating discriminatory barriers in HIRING and recruitment is its number one priority under its Strategic Enforcement Plan. These factors make me think that EEOC leaders themselves recognize the profound disconnect between data depicting discrimination in HIRING, PROMOTION, and PAY, and a charge docket raising primarily TERMINATION allegations.  Intake

Indeed, last year, TERMINATION matters (e.g., discharge, constructive discharge) accounted for over 75% of the EEOC’s intake docket, whereas charges alleging discrimination in HIRING and PROMOTION each made up approximately 7%. Do the math HERE. Worse, PAY discrimination, which is another EEOC National Enforcement Priority, was challenged in less than 6% of all charges, despite some credible evidence of discriminatory disparities by GENDER, RACE, and ETHNICITY.

CRA 1991 has failed its stakeholders, while heaping tremendous financial burdens on employers, for a relatively simple reason: instead of helping an underfunded EEOC prosecute real discrimination in HIRING, PROMOTION, and PAY, trial lawyers prefer to fashion discrimination cases from TERMINATION decisions that will yield THEM bigger paydays in settlement negotiations. Trial lawyers’ financial interests have dictated our dialog about equal employment opportunity, forcing employers to focus on justifying their termination decisions instead of expanding recruiting practices, investing in manager development, and helping working parents achieve better work-life balance–i.e., real EEO issues. Trial lawyers are not prosecuting the real discrimination afflicting the American workplace; on the contrary, they are simply prosecuting the cases that seem potentially profitable, leaving low wage earners (e.g., African-Americans, Latinos, and Women) to fend for themselves like poor Rachel Martinez, the sexual harassment victim whom no CTLA or PELA member would help.

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Trial lawyers are not “gladiators” whose “passion is justice,” to quote Colorado Senator Morgan Carroll’s late-night, TV-peddling personal injury firm.  Trial lawyers claim moral high ground, while literally churning civil rights cases into insurance company settlements. Period. There is absolutely nothing noble, dramatic or enlightening about the process, given that most employers now settle for cost of defense. CRA 1991, however, enabled these trial lawyers to re-brand themselves as “gladiators” and their opponents as racist, sexist, or “ignorant” just for disagreeing with or defeating them. Despite clear pecuniary motives and/or conflicts of interest, these gladiators congratulate themselves for representing “Victims” against “Villain” employers who “violate the law,” while taking between 35% and 50% of the monetary recovery.

Gladiators have still convinced Democrats (and civil rights advocates) that they perform a useful social function as private prosecutors helping under-funded agencies enforce the law.  But CRA 1991 and its aftermath should teach us about what happens when policy-makers entrust complex social problems like inequitable economic opportunity to trial lawyers: they will find a way to make money on the problem without actually solving it.  Private litigation by GLADIATORS is simply not a viable substitute for responsible regulation by GOVERNMENT.

 Merrily Archer, Esq., M.S.W.

June 14, 2016

From Opportunity to Entitlement: How Private Litigation Distorted Our Dialog About Equal Employment Opportunity

Twenty-five years after the Civil Rights Act of 1991, the March toward Equal Employment Opportunity has stalled: trial lawyers’ pecuniary interests have shifted our focus toward TERMINATION decisions, instead of HIRING and PROMOTION practices that keep African-Americans, Latinos, and Women from competing on equal footing in the American economy.  

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Connecting the Dots

This November will mark the 25th anniversary of the Civil Rights Act of 1991 (CRA 1991), an important milestone in the march toward Equal Employment Opportunity (EEO). CRA 1991 fundamentally changed the enforcement scheme of Title VII of the Civil Rights Act of 1964 (Title VII), from initial informal administrative methods of “conference, conciliation, and persuasion” with employers to private litigation against employers. Today, private litigation (i.e., employee-initiated lawsuits) accounts for 99% of EEO enforcement in the workplace trenches.  The EEOC prosecutes less that .1% of its charge inventory and finds Reasonable Cause to believe discrimination occurred in only 3.5% of all charges. For the other nearly 90,000 charges in the EEOC’s annual intake, therefore, employers feel the effects of CRA 1991 through threatened and actual private litigation prosecuted by TRIAL LAWYERS.

Given the impact of CRA 1991, common sense invites us to ask: has CRA 1991 furthered the march toward EEO as its drafters had hoped (and as trial lawyers had promised?).  As the late great Steve Jobs sagely observed,

Indeed, an entire sub-discipline of social work and public policy analysis is devoted to determining whether our interventions (e.g., legislation, programming) have WORKED, to any degree.  For most non-profit organizations, grant funding depends on their ability to demonstrate, through carefully chosen metrics and reliable measurements, that their help is HELPING–namely, that (a) their methods and mission align; and (b) their methods are “moving the needle” toward positive outcomes. Thus, as a social intervention ostensibly designed to further the great March for Opportunity and Jobs that began in August, 1963, CRA 1991 merits attention and analysis.

Looking Back: A Brief History of EEO Enforcement

Most folks have long forgotten about the employment practices that prompted Title VII’s passage, especially the rampant discrimination in HIRING and PROMOTION that kept racial/ethnic minorities and women from participating fully in the American economy. Because paid employment forms the foundation of most people’s financial security, discrimination in HIRING and PROMOTION reinforced the separation of HAVES and HAVE-NOTS by race, ethnicity, and gender and prevented large swaths of the population from rising above the economic circumstances that trapped them in poverty and powerlessness for generations.

No Irish, no blacks no dogsonly native born americans need applyNo Italians, Blackswhites only

Men wanted

The great March of August, 1963 set out to secure basic equal rights in public accommodations, housing, education, and most importantly, EMPLOYMENT.  Without equal opportunity in employment, civil rights advocates realized, access to public accommodations, housing, and education would remain as ECONOMICALLY elusive as before. Thus, the leaders of the great March of 1963 emphasized equal access to EMPLOYMENT, equating JOBS (i.e., economic opportunity) with FREEDOM.

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This March set in motion a legislative blitz that ended with the passage of the Civil Rights Act of 1964 on July 2, 1964, including Title VII’s prohibition against discrimination in EMPLOYMENT.  History buffs will recall JFK’s assassination on November 22, 1963, as well as LBJ’s desire to fulfill JFK’s civil rights vision, notwithstanding his own Texan sensibilities on racial issues.

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The next year, the U.S. Equal Employment Opportunity Commission (EEOC) opened for business. Seven years  later, in 1972, the EEOC lobbied Congress to modify Title VII to give it the authority to PROSECUTE private employers for violations, complaining that without the authority to prosecute, the EEOC was nothing more than a “toothless tiger.” After this statutory modification, EEOC Litigation Centers sprung up all over the nation to not only fulfill Title VII’s promises through administrative enforcement (EEOC), but also through civil prosecution of employers in our federal courts.

In its original form, Title VII stressed injunctive, non-monetary relief and the resolution of discrimination disputes through “informal methods of conference, conciliation, and persuasion.” Section 706(b), 42 U.S.C. 2000e-5(b). Indeed, the original version of Title VII did not allow for jury trials, nor the recovery of compensatory (e.g., pain/suffering, humiliation) or punitive damages. At the time, Title VII’s architects surmised (surely correctly) that juries would not effectively enforce the civil rights of groups they had historically marginalized or hated.  Accordingly, Title VII enforcement was initially entrusted to federal judges, adjudicators with lifetime tenure and little oversight.  And not surprisingly, the great March sputtered along.

Enter Trial Lawyers . . . 

At the 25-year mile-marker, civil rights advocates called attention to our lack of progress on several EEO fronts (e.g., ending job segregation patterns, boosting diversity in top jobs, unemployment) and to a constellation of Supreme Court decisions that, advocates argued, unnecessarily limited Title VII’s broad remedial purposes.  They teamed up with trial lawyers, and fashioned a public policy argument that still echoes throughout state legislatures today: because of Title VII’s limited damages (and of course, lack of jury trials), trial lawyers had little incentive to take on employment discrimination cases. Accordingly, these self-proclaimed civil rights “gladiators” asked Congress to “sweeten the pot” by allowing recovery of compensatory damages, punitive damages, and attorneys’ fees and by guaranteeing civil jury trials. With these additional financial incentives to prosecute EEO matters, trial lawyers argued, they can help the EEOC, as deputized mini Attorneys General, stop discrimination and advance the march toward equal opportunity.

In 1991, these arguments still rang true. Due to chronic under-funding, the EEOC had developed an insurmountable backlog of pending EEO investigations, as well as a reputation for inertia.  But, according to trial lawyers and civil rights advocates, the threat of PRIVATE litigation would motivate offending, unenlightened employers to comply with Title VII’s mandates and “provide relief” for “victims” of their “unlawful employment practices.” Business groups offered anemic resistance to CRA 1991, except for insisting upon damage caps based on employer size. And by November of 1991, in backroom deals between lobbyists for advocacy groups, Chambers of Commerce, trial and civil rights lawyers, and small business, the Civil Rights Act of 1991 emerged, a significant change in federal enforcement backed up by surprisingly little legislative history.

Two Decades of Data and Dots to Connect

I joined the EEOC’s Denver District Office as a Trial Attorney six years later, in November of 1997, after finishing my JD/MSW at Washington University in St. Louis on a civil rights fellowship. I started out as a rabid “true believer” in the importance (and efficacy) of changing hearts and minds through rigorous litigation, a belief that dissipated through daily exposure to the EEOC’s methods, management, and much-distorted mission to maximize employer settlement payouts. But my own legal career grew up around CRA 1991, and because my interest equal opportunity has remained constant, I’ve paid careful attention to developments on the ground and in social science research.

Civil rights advocates and policy analysts too often forget a central tenet of natural law (Newton’s Third Law of Motion, actually): for every action, there is an equal and opposite reaction.  As a longtime attorney representing BUSINESSES, Newton’s Third Law roughly translates as the caption below.  How can we respond to or minimize the impact of CRA 1991’s costs and risks?

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In fact, after CRA 1991’s passage, the “market” responded in foreseeable ways that we have detailed in other articles:

  • EEOC’s Adoption of Priority Charge Handling Procedures (PCHP)

My tenure as an EEOC Trial Attorney in Denver from 1997-2000 let me observe firsthand how the EEOC grappled with the deluge of new EEOC charges following CRA 1991’s passage. In 1995, the EEOC adopted Priority Charge Handling Procedures (PCHP), triaging protocols that remain very much in use today. Although CRA 1991 effectively privatized EEO enforcement, its statutory scheme still required employees and their attorneys first to file a Charge of Discrimination within 300 days at the nearest EEOC office and to obtain a Notice of Right to Sue before proceeding to court . . . and not surprisingly, EEOC charge intake soared and its “handling” of charges became more superficial and perfunctory than ever before.  Of course, as indicated earlier, the EEOC acts on only a very small number of charges, issuing reasonable cause determinations in 3.5% of charges and prosecuting less than .1% of all discrimination allegations.

  • Proliferation of Employment Practices Liability Insurance (EPL)

In the 1990’s, few insurance carriers offered Employment Practices Liability coverage to defray the defense costs and risks of big damages under CRA 1991.  But where there is risk, the insurance industry offers a remedy, and without doubt, CRA 1991 exposed employers to greater risks (e.g., jury trials on sensitive issues) and costs than ever before. Nowadays, over the past 20 years, a majority of employers have purchased EPL coverage.

I became very familiar with EPL insurance after leaving the EEOC in 2000 to launch my defense practice.  In those early years, I considered EPL insurance a very poor fit for employment cases, given their typically emotional nature: whereas insurance carriers always favor settlement to minimize defense costs, most employers simply cannot not stomach the notion of paying out $30K on unfounded, nefarious, and brand-damaging allegations. Extortion, I’d often hear employers say, during spirited settlement conferences.

I also had difficulty reconciling a logical inconsistency about the insurability of EEO allegations, given that insurance is typically not available for INTENTIONAL acts and discrimination, harassment, or retaliation are theoretically intentional acts.  But over time, I realized that without EPL insurance, the non-recoverable defense costs of proving they did nothing wrong in the first place would force many small to mid-sized businesses into bankruptcy.

By design, EPL insurance took the sting out of CRA 1991’s enhanced remedies–i.e., the “stick” designed to scare employers into Title VII compliance.  Because EPL coverage pays defense and indemnity (e.g., judgments, settlements) costs, employers have minimal direct financial exposure in EEO disputes, except for their deductible and a potential increase in premiums.  And although EEO allegations inherently involve INTENTIONAL acts, many employers now treat EEOC charges as simply an UNAVOIDABLE COST of doing business, like a slip-n-fall or workers’ compensation accident. From a behavioral modification perspective, therefore, EPL neutralized CRA 1991, rendering it completely ineffective as a tool to effectuate workplace change. Instead, CRA 1991 spawned a wealth redistribution cycle between employers, EPL insurance carriers, and lawyers (on both sides) where nothing much changes except money changing hands . . . between themselves.

  • The Stalled March Toward Equal Employment Opportunity

Since 2013, in anticipation of Title VII’s 50th birthday on July 2, 2014, my friends at Biddle Consulting Group and I have, both individually and cooperatively, conducted on-going research about our progress toward EEO.  We started by asking, what kinds of measurements might indicate progress or lack thereof?  After all, the EEOC and OFCCP historically claimed that they were “enforcing the law more effectively” based on employer settlement payouts, a measurement that made little sense in light of their respective missions–namely, to end workplace discrimination against and to promote opportunity for women and minorities.

We analyzed the EEOC’s own EEO-1 data, examining the pace and trajectory of change in two specific areas: (1) historic job segregation patterns; and (2) minority advancement into the Official/Manager and Professional categories of jobs, the “top jobs” in EEOC-speak.  We dug further, analyzing quarterly data from the Department of Labor’s Bureau of Labor Statistics (BLS) on unemployment and its impact across racial/ethnic and gender groups. We tapped into the robust databases at Catalyst.org for international information on women’s corporate advancement, workforce participation, and governmental leadership. And, in March of 2014, we published our findings HERE and in EEO Insight, the nation’s leading periodical for the Affirmative Action and EEO industry.

Based upon our findings, we concluded that the great March for Jobs and Freedom of 1963 stalled out in the mid-1990’s, particularly for African-Americans, Latinos, and women. The next year, the EEOC released its 50th Anniversary Report on the American Workplace based upon the same EEO-1 data that Biddle’s Dan Kuang, PhD had analyzed and not surprisingly, the EEOC’s findings mirrored our earlier report (sans the helpful BLS and Catalyst.org data).

Why have African-Americans lost ground in their quest for Official/Manager jobs since 2008? Why have Women improved their participation rates in the Professional category, but not the Official/Manager category (i.e., the glass ceiling)?  Why are African-Americans, Latinos, and Women still concentrated in lower paying positions, whereas Whites and Asians dominate the highest echelons of the pay scale?

  • From Hiring and Promotion to FIRING Claims

On April 4, 2006, the EEOC announced another major shift in its administrative enforcement of Title VII, switching from a cohort discrimination model to a systemic model. The EEOC stated its intent to focus on “discriminatory hiring barriers” (e.g., criminal background and credit checks, pre-employment tests) that reinforce past “vestiges of discrimination.” In other words, under the EEOC’s systemic initiative, the EEOC planned to return its focus to HIRING and PROMOTION practices that have kept “economic minorities” (e.g., Women, African-Americans, Latinos) from breaking through historic job segregation barriers and glass ceilings.

The EEOC’s renewed focus on HIRING and PROMOTION came as a welcome surprise, until I remembered that the EEOC takes action on less than 3.5% of its charge inventory and prosecutes less than .1% of all allegations. Despite touting this initiative, the EEOC filed only 42 systemic prosecutions in FY2015, and its flagship prosecutions–e.g., EEOC v. Kaplan Higher Ed. Corp. (credit reports) and EEOC v. Freeman (criminal background)–did not survive summary judgment.

While the EEOC’s systemic initiative floundered (despite its laudable aims), however, employers continued to face an increasing number of EEOC charges and PRIVATE litigation from their own employees. These charges seldom involved HIRING and/or PROMOTION discrimination; on the contrary, increasingly over time, the bulk of the EEOC’s charge intake came to involve TERMINATION decisions.  By FY2015, the bulk of the EEOC’s charge intake challenged TERMINATION decisions, not HIRING or PROMOTION ones.

IntakeWHY?  Although data shows that discrimination in HIRING and PROMOTION likely remains rampant, trial lawyers disfavor hiring/promotion cases.  They require statistical experts and lots of work.  Because of the universal “duty to mitigate” damages, hiring and promotion cases typically yield small monetary recoveries; after all, in many cases, a rejected applicant (even one rejected for discriminatory reasons) will simply apply for and accept another job with comparable pay and benefits.

TERMINATION cases, by contrast, allow trial lawyers to pile on discrimination, harassment, and retaliation claims in a familiar “shotgun method” of pleading (i.e., spewing many pellets in hopes that one hits the target).  Termination cases yield bigger backpay awards, in light of most terminated employees’ inability to find comparable employment over long periods of time. Termination cases generate large frontpay awards. Termination cases engender greater emotional distress and juror sympathy–i.e., I was a loyal employee who planned to work here until retirement!  Termination cases, especially those involving retaliation allegations, are easier to spin into settlements, at least from a trial lawyers’ perspective.

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From the employers’ perspective, however, termination decisions involve an employee’s SQUANDERING of opportunity, not any discriminatory failure to provide opportunity. Indeed, for every employee allegation of discrimination arising out of a termination, there are one or more equal and opposite explanations for the decision, typically poor performance and failure to rehabilitate.  According to the EEOC’s own statistics, employers’ legitimate, non-discriminatory and non-retaliatory reasons for terminating the employee persuade the EEOC in the majority of cases that no discrimination occurred whatsoever.  Discrimination is, after all, difficult to prove, but easy to allege.

From Opportunity to Entitlement: Refocusing Our Dialogue About EEO

The great March for Jobs and Freedom and the quest for inclusiveness at ALL levels of our workforce have sputtered to a crawl at the 50-year mile-marker, likely for a multitude of reasons. But here’s one reason no one seems to have noticed thus far: instead of focusing on boosting diversity/inclusiveness in HIRING and PROMOTION, employers are naturally more motivated to neutralize any risk posed by TERMINATIONS and to allocate internal resources accordingly. Thus, while statistics suggest that discrimination in HIRING and PROMOTION remains pervasive, it often goes completely undetected or unchallenged because (a) few trial lawyers have the patience, wherewithal, or social conscience necessary for successful private prosecution; and (b) savvy employers allocate resources based on risk exposure–i.e., TERMINATION decisions.

Our national EEO focus on termination decisions, however, has also caused a shift in how employees perceive EMPLOYMENT generally, shifting the workforce from an OPPORTUNITY mindset to one of ENTITLEMENT:  i.e., You can’t fire me!  You owe me a job no matter how incompetently I perform it.  Quarterly Gallup polls reveal that over 70% of the American workforce is “disengaged” (i.e., “checked out”) at work–e.g., disinterested, disloyal, disenchanted like Peter Gibbons from Office Space.

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HR practitioners and workplace analysts have known for decades that disengaged employees are most likely to commit “job abuse”–e.g., chronic absenteeism, missed deadlines, poor work product or output.  Disengaged employees do not treat work like an opportunity, but rather an entitlement. They could care less about advancing their employers’ business objectives or even being good at their jobs. Likewise, they could care less about the impact of half-assed performance on others, such as students, patients, customers or clients. On the contrary, chronically disengaged employees chronically under-perform, while demanding that employers tailor their positions to their unique personal circumstances on and off the job. Disengagement and entitlement, I am convinced, also form part of a constellation of behaviors that are predictive of who will sue if terminated.

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The numbers are difficult to reconcile: 70% of employees are “disengaged” at work, yet 75% of EEOC charges now involve termination decisions, not HIRING or PROMOTION ones. Worse, the pool of available jobs is SHRINKING, given that technology has steadily replaced jobs quicker than it has created them.  MIT professors Andrew McAfee and Erik Brynjolfsson observed in their revolutionary work, The Second Machine Age, “as technology races ahead, it may leave a lot of people, organizations and institutions behind.”  And no doubt, unless we figure out how to deliver on Title VII’s promise of equal employment opportunity, the people that technology will first leave behind are those concentrated in Administrative Support, Operatives and Laborers/Helpers–to wit, Women, African-Americans, and Latinos.

The Road Ahead

Over the past few years, members of the National Trial Lawyers Association (NTLA) and National Employment Lawyers Association (NELA)–i.e., the chief architects and beneficiaries of CRA 1991–have called me “racist,” “unenlightened” and even “immature” and “anti-Islamic” for questioning the efficacy of this statutory scheme. But their attacks reveal their underlying intent: if they truly cared about advancing EEO as much as the financial windfall that CRA 1991 generates for themselves, they would echo my concerns about whether this enforcement model has worked, to any degree.

NTLA and NELA have convinced advocacy groups and the EEOC, however, that LITIGATION promotes inclusion and diversity or stated another way, that the ability to sue employers somehow equates with greater opportunity and inclusiveness.  Yet, after 25 years of CRA 1991 “enforcement,” NTLA and NELA attorneys have demonstrated that rather than solve the social problem of inequitable economic opportunity, they have simply found a way to make money on it.

NTLA and NELA attorneys also commonly retort: this is the only enforcement model we have; only racists would seek to deconstruct it!  In truth, this enforcement model is all we have because of their powerful lobbying and disingenuous marketing (i.e., “we’ll fight for you!”). But, public policy choices ABOUND for advancing the march toward EEO, from tax incentives like the Work Opportunity Tax Credit (WOTC) to internal management development and resource integration programs. Read more HERE.

Further, research continues to reinforce the strong correlation between diverse/inclusive workplaces and decision-making AND higher profits, better access to top talent, enhanced community reputation, and improved group synergy/creativity. More HERE. As this BUSINESS CASE for diversity/inclusiveness comes into sharper focus, our efforts to advance EEO should concentrate on collaborating WITH employers, not declaring war AGAINST them. With rapid technological advancement, businesses are increasingly questioning the value of hiring HUMANS entirely; after all, technology may malfunction, but it cannot sue.

Merrily Archer, Esq., M.S.W.

April 14, 2016