EEOC Tactics Deemed Over-Aggressive: Hefty Fines May Result

Last year, the Equal Employment Opportunity Commission (EEOC) filed a lawsuit against Peoplemark, Inc., a temporary staffing firm, for racial discrimination. The EEOC claimed that Peoplemark did not hire applicants with criminal records, and they claimed that the staffing firm was discriminating against Hispanic and African Americans.

One individual brought her concern to the EEOC, claiming that she was denied employment because of her criminal conviction record, “as well as an unidentified class of similarly situated individuals.” The EEOC then filed a civil complaint. However, Peoplemark produced records showing that 22 percent of the 286 applicants the EEOC claimed were affected have actually been hired. Because of this, the EEOC and Peoplemark filed a joint motion to dismiss the case.

Because the claim was considered unreasonable, Peoplemark asked for their attorney fees and costs to be reimbursed to them.

This case has garnered a lot of attention lately, as employers are concerned about the EEOC’s tactics for its “sue first, ask questions later” approach. The federal court has since reprimanded the EEOC. The U.S. Chamber of Commerce, National Federation of Independent Business Small Business Legal Center, and the Equal Employment Advisory Council recently joined together to file a motion urging the federal appeals court to make the EEOC pay Peoplemark for its costs and attorney fees.

A lower court has since awarded Peoplemark $752,000 for their costs involved in this unreasonable lawsuit. However, the EEOC is appealing the lower court decision. This situation has many concerned about the EEOC’s enforcement efforts, over-aggressive tactics, and whether the EEOC will rethink its approach in cases down the road.

Our Austin business lawyers at Posey Law Firm will keep you up-to-date on the latest in this case.

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