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Cheri Cannon explains why money federal agencies have paid out in discrimination and employment complaints is at a 10-year-high.


Agency payouts in discrimination cases hits 10-year-high

By Andy Medici
September 24, 2014


Are agencies settling claims to avoid Equal Employment Opportunity Commission hearings?The amount of money agencies paid to resolve federal employee discrimination and employment complaints is at a 10-year-high, according to an analysis by federal employment law firm Tully Rinckey.

Agencies paid out $54.9 million in fiscal 2012, surpassing the previous high of $53.4 million in fiscal 2005. The increase is in part because agencies appear more likely to offer financial settlements in order to avoid time-consuming Equal Opportunity and Employment Commission hearings.

“Settlements are agencies’ best tool to help them avoid lengthy and costly litigation as well as EEOC orders requiring them to pay large sums in monetary benefits for discriminatory conduct,” Tully Rinckey partner Cheri Cannon said.

While the overall settlement rate dropped the number of settlements with monetary awards climbed to 13.8 percent – the highest in 10 years, according to the analysis.

Agency pre-complaint settlements with monetary benefits and formal complaint “lump sum” payouts – where agencies make a single payment to settle an EEOC dispute without identifying portions for back pay or damages – together increased to $29 million in fiscal 2012. That represents an increase of nearly 19 percent from fiscal 2011, when lump-sum payments reached $24.4 million.

However, any employee thinking about pursuing a case should understand that winning or negotiating a settlement requires a lot of evidence, according to Cannon.

“Yes, it looks like agencies are more willing to use money to make credible discrimination complaints go away, but federal employees need to remember that they need to present an overwhelming amount of evidence in their favor to get agencies to seriously negotiate a settlement or to win a case,” she said.

Agency settlements may have contributed to a drop in final EEOC decisions, which totaled 214 in fiscal 2012 – far below the 10-year average of 243.

But in some cases where agencies did not settle, the EEOC awarded a total $8.8 million in compensatory damages – up almost 22 percent from fiscal 2011, according to the analysis. In cases with willful violations, EEOC can award compensatory damages for future losses and suffering, according to Tully Rinckey.


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