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The Price of Top-Down Management

The American Lawyer – by Nathan Koppel - December 6, 2002

(12/2/02) - Does top-down management have a new downside? The battle between Chicago's Sidley Austin Brown & Wood and the U.S. Equal Employment Opportunity Commission may provide an answer. The EEOC is investigating Sidley for age discrimination in its 1999 demotion of 32 partners, the majority of whom were older than 50 ["Seniority Complex," June 2000]. Sidley denies that age was a factor in the demotions, and it claims the EEOC can't investigate its partners because they are "employers" -- federal antidiscrimination laws protect only "employees," the notion being that employers call the shots and don't need protection.

So far Sidley is losing the employer/employee name game, which means that EEOC v. Sidley could pave the way for law firms to face more age, race, and sex discrimination claims. On October 24 Judge Richard Posner of the 7th U.S. Circuit Court of Appeals issued a biting opinion in the case that questioned whether Sidley partners have enough authority to be deemed employers. Sidley's executive committee, not its rank-and-file partners, wrote Posner, holds most of the power at the firm.

For procedural reasons, the judge, writing for a 3-to-0 panel, didn't ultimately decide whether Sidley partners are employers or employees. Sidley must first produce additional evidence, he wrote, before the partners' legal status can be resolved. But Posner's opinion is still problematic, because it rebuts the notion, widely held among law firms, that partners are automatically beyond the EEOC's reach. Instead, it depends on the facts of each case, says Posner. "The lesson for firms in this case is that you can't get away with anything you want just by calling someone a partner," says James Burns, Jr., an employment partner at Chicago's Katten Muchin Zavis Rosenman.

"I think it is a very troublesome decision," adds Allen Fagin, co-chair of labor and employment at New York's Proskauer Rose. He says that Posner's case-by-case approach to deciding whether a partner is, in fact, an employer offers law firms little guidance about their potential liability. Fagin is further troubled that Posner saw Sidley's executive committee as evidence that its partners might be entitled to federal protection. "The trend in large firms is to concentrate day-to-day decision authority in a relatively small executive committee and/or firm chair," says Fagin.

Posner's opinion presages a lucrative class of new plaintiffs. "In professional service firms, you have a huge bulge of baby boomer partners making hundreds of thousands [of dollars] who may be protected by civil rights laws," says Michael Maslanka, chair of labor and employment at Dallas' Godwin Gruber. "Plaintiffs' lawyers will have a feast on [Posner's opinion]. It's like ringing the dinner bell."

The investigation of Sidley took a serious turn in 2001, when the EEOC issued a subpoena requesting that Sidley produce all documents pertaining to its decision to demote the 32 partners. Sidley complied only in part, producing information that demonstrated, in the firm's view, that the demoted partners were true partners and thus beyond the reach of the federal Age Discrimination in Employment Act. Sidley, for example, revealed to the EEOC that the demoted partners all shared in firm profits and firm liabilities and also contributed capital to the firm. "No case in history has ever applied the ADEA to an equity partner in a bona fide law firm," asserted Sidley in a pleading filed this year in the case.

In February, U.S. District Judge Joan Humphrey Lefkow of Chicago ordered Sidley to comply in full with the EEOC's subpoena. On appeal, Posner also rejected Sidley's attempt to halt the EEOC in its tracks. He conceded that the demoted Sidley partners were true partners. But that alone, he ruled, didn't mean that they were employers. Posner focused on Sidley's management structure, which vests considerable authority in a self-perpetuating executive committee. The committee, wrote Posner, "can fire [Sidley partners], promote them, demote them (as it did to the 32), raise their pay, lower their pay, and so forth. The only firmwide issue on which all partners have voted in the last quarter-century was the [2001] merger with Brown & Wood, and that vote took place after the EEOC began its investigation."

Though Posner seemed to view the demoted Sidley partners as largely powerless, he stopped short of ruling on their legal standing. He ordered Sidley to produce additional documents -- including such private information as Sidley's method of distributing profits on a firmwide basis -- to aid the EEOC in deciding whether Sidley partners are covered by the ADEA. If the EEOC decides the partners are covered, Sidley will have a chance to contest that in court. Posner did throw Sidley one bone: He ruled that it doesn't have to hand over information about its demotions until the employer/employee issue is resolved.

Sidley seized on that point to claim victory. "The bottom line is that the bifurcation approach [of first resolving whether partners are employers before addressing whether the firm violated the ADEA] has been accepted, and we are pleased with that," says Sidley's lawyer, Paul Grossman, an employment partner in the Los Angeles office of Paul, Hastings, Janofsky & Walker.

The EEOC is also pleased. John Hendrickson, the lead EEOC lawyer, says that Posner's opinion is perfectly in tune with the modern megafirm, where partners don't necessarily have management authority or control over their employment status. "Posner clearly says ... let's not get hung up on [partner] labels, let's look at what is really going on here," says Hendrickson.

Of course, Posner's isn't the final word. In his concurrence with the Seventh Circuit panel opinion, Judge Frank Easterbrook agreed that the EEOC could proceed with limited discovery, but he would equate equity partnership with employer status -- regardless of Sidley's top-down management structure. And Posner is not the first judge to advocate a nuanced, case-by-case approach to deciding whether partners are employers or employees.

But, given Posner's stature, Sidley and the EEOC will have many lawyers looking over their shoulders as they explore the nuances.

EEOC Settles Major Age Bias Suit

EEOC – by Press Release – November 17, 2002

(11/15/02) - NEW YORK -- The U.S. Equal Employment Opportunity Commission (EEOC) announced today that it has settled a class age discrimination lawsuit with retail giant Foot Locker Specialty Inc. for $3.5 million on behalf of a class of hundreds of older former employees of the F.W. Woolworth Company whose employment was terminated because of their ages during nationwide layoffs between 1995 and 1997.

"The EEOC commends Foot Locker for taking positive steps to correct this wrong," said EEOC Chair Cari M. Dominguez. Noting that age bias is the fastest growing type of charge filed with the EEOC, she added: "As the graying of America's work force continues, age discrimination is becoming an ever-increasing national problem. Employers must be ever vigilant that age is never used as a criterion for employment decisions."

The EEOC's lawsuit, Case 99 CIV. 4758 in U.S. District Court for the Southern District of New York, alleged that Woolworth targeted employees 40 years old or over for layoffs because of their ages, and that many were promptly replaced by younger persons hired from the outside. The EEOC found evidence that F.W. Woolworth selected older employees for discharge out of proportion to their representation of the work force, and that the company engaged in a nationwide pattern or practice of discrimination against older employees in its stores.

The EEOC also discovered additional evidence of age-discriminatory statements and actions that motivated the actions of the company's executives and decision makers.

The EEOC litigated the case under the Age Discrimination in Employment Act of 1967 (ADEA) on behalf of a nationwide group of employees with charges of discrimination made by individuals throughout the mainland United States and Hawaii. The EEOC filed suit after exhausting its conciliation efforts to reach a voluntary pre-litigation settlement.

The Consent Decree settling the suit provides for lost back pay and liquidated damages on behalf of a group of 678 former employees age 40 or older whom F.W. Woolworth discharged from its stores throughout the United States. Although F.W. Woolworth Co. and its Woolworth retail stores ceased operation in 1997, the corporate parent continued to operate and now exists as Foot Locker Specialty, Inc., which operates retail clothing stores. F.W. Woolworth Co., Inc. changed its name to Foot Locker Specialty, Inc. which is a subsidiary of Foot Locker, Inc.

"Firms that attempt to force out and replace their older employees are breaking the law and risk having to make sizable restitution, as was done in this case," said Katherine Bissell, EEOC's New York District Regional Attorney. "Even when a retailing giant contemplates liquidating a chain of stores, it may not single out its most senior employees for adverse, discriminatory treatment."

Spencer H. Lewis, Jr., Director of the EEOC's New York District Office, added that "reductions-in-force may be a necessary fact of economic life, but age discrimination is not. Productive, hard-working employees with 20 to 30 years of experience deserve better than to be displaced by younger, less experienced persons hired off the street."


EEOC – by Press Release – November 17, 2002

(10/31/02) - MEMPHIS - A federal jury in the U.S. District Court for the Western District of Tennessee returned a verdict in favor of the U.S. Equal Employment Opportunity Commission (EEOC) and the Plaintiff-Intervenor, Kevin Armstrong (Armstrong), in a lawsuit brought by the Agency on behalf of Armstrong, an insulin-dependent diabetic applicant for the position of equipment service employee (ESE or baggage handler) at the Northwest Airlines hub in Memphis, Tennessee. The suit was brought by the EEOC under Title I of the Americans with Disabilities Act of 1990 (ADA).

The jury awarded the EEOC and the Plaintiff-Intervenor, for the benefit of Armstrong, $19,250 in compensatory damages and $21,000 in back pay.

According to the EEOC, Armstrong applied for the ESE position in May 1998. He was issued a conditional job offer on May 9, 1998, and passed his pre-placement physical in Memphis on May 13, 1998. Later, Northwest Airlines' contract physician located in Minnesota learned that Armstrong was an insulin-dependent diabetic and then withdrew job offer.

The Commission filed suit on September 27, 2000, after exhausting its efforts to reach a voluntary pre-litigation settlement. The judge in the case was District Judge Jon P. McCalla. The jury rejected Northwest Airlines' defense that Armstrong posed a direct threat to himself or others because his insulin-dependent diabetes was poorly controlled.

The EEOC was represented by Supervisory Trial Attorney Faye Williams and Senior Trial Attorney Deidre Smith, both of the agency's Memphis District Office.

Katharine Kores, EEOC Acting District Director in Memphis, said: "The verdict in this case should remind all employers that hiring decisions should be based on the applicant's real abilities and not stereotypical ideas about an applicant's disability."

Same-Sex Harassment Suit

EEOC – by Press Release – November 17, 2002

Male Employees Subjected to Groping and Lewd Sex-Based Remarks by Male Managers

(10/28/02) - DALLAS - The U.S. Equal Employment Opportunity Commission (EEOC) today announced that Ron Clark Ford, Inc. has agreed to pay six former male employees $140,000 to settle a same-sex harassment lawsuit under Title VII of the Civil Rights Act of 1964. In addition to the monetary relief for former employees William Blount, Joe Charles, John Crawford, Dusty Harrison, Ulices Herrera and Richard Epps, the Consent Decree settling the case, signed by Federal District Court Judge Sam Cummings, requires Ron Clark Ford to provide training to prevent sexual harassment and post an anti-discrimination notice at the

Amarillo, Texas-based dealership.

The EEOC's lawsuit (Civil Action No. 2-01CV-0245-C) was based on charges of discrimination filed by three of the men with the the federal Agency's Dallas District Office. The men said they and others were subjected to a sexually hostile work environment and different treatment because of their gender by male managers - which resulted in their constructive discharge. Blount, Charles and Crawford were also represented by private attorney Mark Wilson of Smith, Wilson & Duncan, P.C. in Amarillo.

Evidence gathered during the Commission's investigation showed that the men were subjected to lewd, inappropriate comments of a sexual nature and had their genitals and buttocks grabbed against their will by males managers. The dealership argued that the sexual conduct was "harmless horseplay" - a position that was contradicted by the evidence uncovered in the EEOC's investigation. The Commission filed suit after finding that discrimination took place and exhausting its conciliation efforts to reach a voluntary pre-litigation settlement.

"An employer should never assume that it can hide behind a gender-based double standard 'horseplay' defense," said Robert A. Canino, Regional Attorney of the Dallas District Office of the EEOC. "To do so is to trivialize what can be offensive and degrading conduct toward employees who don't find it amusing. The law doesn't provide a safe harbor when men sexually grope other men instead of groping women. Moreover, there is no free pass for employers who fail to prevent or correct such offenses on the stereotypical premise that 'boys will be boys'."

Pursuant to the terms of the Consent Decree, Ron Clark Ford, Inc. has agreed to establish a "Zero Tolerance" sexual harassment policy that requires supervisors to prevent and correct sexual harassment. Specifically, the policy requires that supervisors take seriously all complaints of sexual harassment made by male or female employees at the dealership.

"During the litigation, EEOC learned that Ron Clark Ford management either laughed at or ignored what was going on at the dealership, " said Bill Backhaus, Senior Trial Attorney of the Agency's Dallas office. "EEOC expects that the new Zero Tolerance policy and anti-harassment training should improve management's ability to properly respond to complaints of sexual harassment in the workplace."

Sexual harassment charges filed by men nationally with the EEOC have shown a steady rate of increase over the years from 10% of all sexual harassment filings in Fiscal Year 1994 to nearly 14% of all such filings in FY 2001. In 1998, the U.S. Supreme Court affirmed the EEOC's longstanding position that same-sex harassment of men is a violation of Title VII.

President Bush and Pensions

Employee Advocate – – October 21, 2002

President Bush has announced that he wants to protect employee pensions, according to The New York Times. But the proposed legislation covers only 401 (k) plans.

If G. W. Bush is really serious about protecting pensions, it is time for the cash balance plan issue to be addressed by the Equal Employment Opportunity Commission. Cash balance age discrimination charges have been filed since 1999.

Click the link below to view a letter to President Bush asking him to take cash balance plan action. If you can, send him a similar letter. Send your representative and senators a copy of it.

Pension Letter to President Bush

EEOC Crushes Confidentiality Agreement

The Deal – by Heidi Moore – October 21, 2002

Add another item to Wall Street's legal woes.

A surprising development in a high-profile lawsuit signals that the federal government is willing to get more involved in gender discrimination cases between Wall Street firms and their employees. The first casualty: a confidentiality agreement that exists at every firm.

The clash stems from a confrontation between the Equal Employment Opportunity Commission and Morgan Stanley. The EEOC has obtained court permission to circumvent Morgan Stanley's confidentiality agreements, which had been considered legally binding, with former employees who have already settled with the firm. The EEOC also won permission to get around Morgan Stanley's internal code of conduct.

Both the confidentiality agreements and the code of conduct require employees to inform the firm if they are contacted about any investigation into Morgan Stanley. The firm and its rivals thus have no assurance that, when they settle with employees, they still won't face an EEOC investigation and lawsuit.

Michelle Caiola, the EEOC trial attorney handling the case, said, "It's designed to send a message to Wall Street."

According to Barry Hartstein, head of the American Bar Association's equal employment opportunity committee and a partner with Vedder, Price, Kaufman & Kammholz in Chicago, the EEOC's involvement is largely symbolic.

Hartstein said the agency's attempt to overturn the confidentiality clauses is being used to put not just Morgan Stanley, but also other Wall Street firms on guard.

"This [clause] doesn't prevent the employee from speaking," Hartstein noted. "It only puts the employer on notice. The EEOC simply wants to avoid the subpoena."

The clause prevents any employee who has settled with Morgan Stanley from testifying against the firm unless required to do so by a subpoena. Even after Morgan Stanley employees receive a subpoena, they must meet with Carol Bernheim, a principal at the firm, allowing Morgan Stanley to "take whatever action it may deem necessary or appropriate to prevent such assistance or testimony."

Avoiding the subpoena allows the EEOC to reduce the number of logistical hurdles. "I wouldn't be surprised if the EEOC made this assertion in other types of litigation," Hartstein said.

In fact, the EEOC has long held that it will not tolerate any barrier to its investigations.

The court decision is part of a gender-discrimination case involving Allison Schieffelin, a Morgan Stanley convertible sales executive who alleged that she didn't receive the promotions or raises of less-experienced male colleagues. Morgan Stanley denies the allegations, and the case is going to trial. The EEOC is suing on Schieffelin's behalf.

The decision by U.S. Magistrate Judge Ronald L. Ellis on Sept. 20 came as the EEOC and Morgan Stanley were setting ground rules for the upcoming trial.

Ellis said that while investigating Schieffelin's claims, the EEOC can ignore confidentiality agreements between Morgan Stanley and former employees who have already settled.

Under the agreements, the EEOC would have to subpoena every former employee that it believes could help its case and give Morgan Stanley two days to respond. Now the EEOC may approach those employees directly.

The judge also set aside Morgan Stanley's code of conduct, which requires current employees to consult with the firm's law or compliance departments before cooperating with any investigation of the firm or else face termination.

"With regard to the code of conduct, we have never meant the code to preclude employees from communicating with any government body regarding individual rights, including workplace rights," said Morgan Stanley spokeswoman Judy Hitchen.

The EEOC argued that the confidentiality clause and code of conduct create a "chilling effect" by making it difficult to talk to current and former Morgan Stanley employees. "The EEOC is charged with investigating pattern and practice claims and, in order to do so, needs access to the relevant employees," Ellis wrote in his analysis of the arguments.

The decision poses several threats to Wall Street firms.

First, given the popularity of confidentiality agreements, firms now have no assurance that past settlements will remain settled, said Gavin Appleby, the Atlanta-based head of the labor and employment practice at Powell Goldstein Frazer & Murphy.

"It's a surprising ruling," said Appleby, who does legal work for some Morgan Stanley rivals. "It puts Morgan Stanley and other companies at a bit of a disadvantage, in that these are separation agreements we all use to try to limit the ramifications of any settlement we get into. This allows the EEOC to go behind that, and it would be difficult for us to stop."

Hartstein added, "The whole notion of attempting to resolve a claim with a charging party is to resolve all matters between them."

Second, the EEOC as a federal agency already has wide latitude during such a probe, said Appleby and Caiola. "The EEOC's work is seen as being in the public good," Caiola said, which means that there are "some rights you can't contract away."

Despite all this, Hartstein believes such clauses will remain popular. "I'm not necessarily convinced that this [decision] means that employers are going to fold their tent and say, 'We're not going to include this provision,'" he said.

EEOC Pension Win Over Verizon

New York Law Journal – by Tamara Loomis – October 11, 2002

Verizon Will Credit Female Employees for Maternity Leave

Verizon Communications Inc. will credit thousands of current and former female employees who took pregnancy or maternity leave, entitling them to millions of dollars in pension benefits, under a consent decree approved Thursday by a New York federal judge.

Up to 12,500 women in New York, 12 other states and the District of Columbia who worked for the New York-based company will receive service credit for time off from work to have or raise a baby, according to the Equal Employment Opportunity Commission, whose New York district office brought the lawsuit.

"We hope this settlement sends a message to employers that women cannot be penalized for leaves of absence related to pregnancy and child care," EEOC New York Regional Attorney Katherine E. Bissell said in a statement.

The consent decree, approved Thursday by Southern District of New York Judge Denny Chin, resolves lawsuits brought by the EEOC in 1997 and 1999 against Bell Atlantic and NYNEX (now Verizon). The agency, which has estimated that employees could receive benefits worth more than $10 million, said it is one of the largest settlements ever on the issue.

From 1965 to 1979, the company did not give service credit to female employees on pregnancy or maternity leave, in contrast to men on disability or in military service, who were given full credit. Service credit is used to determine when employees are eligible for their pension and how much they will get.

Under the consent decree, which formalizes a settlement reached earlier this year, women will get two to seven weeks of additional service credit per pregnancy. Some employees who missed out on early retirement may get up to 12 weeks of credit.

Verizon maintains that its policies complied with the law at the time, according to company spokeswoman Sharon Cohen-Hagan. The company settled the case, she said, because it did not want to drag out the litigation any further. She added that the company considered the amount of the settlement non-material.

The company began changing its policy in 1978, when Congress passed the Pregnancy Discrimination Act, making it illegal to fire, demote or refuse to hire women because they are pregnant. Under the law, expectant and new mothers in the work force are also entitled to the same benefits given to temporarily disabled employees.

It does appear that Verizon's policies toward working mothers have come a long way since the late 1970s. Last month, Working Mother magazine named subsidiary Verizon Wireless one of the 100 best companies for working mothers for its positive work environment for women, which includes a "$10 Baby" program in which expectant mothers pay only an initial $10 co-pay for prenatal care and delivery expenses.

The EEOC's case against the company mirrors another case it settled in 1991. In that suit, the agency charged Western Electric Co. (now AT&T Corp.) with forcing pregnant female employees to leave their jobs sooner than they wanted, and refusing to credit women with accrued seniority while they were on pregnancy leave.

The case, which was filed in 1978 on behalf of some 13,000 women who worked for Western Electric from 1965 to 1977, settled for a record $66 million.

EEOC Won 60% of Discrimination Trials

Associated Press – by Leigh Strope - August 13, 2002

WASHINGTON - The Equal Employment Opportunity Commission says it won 60 percent of its employment discrimination trials in the past five years.

That compares with a success rate of nearly 27 percent for private plaintiffs in workplace bias suits, according to the EEOC's litigation report being released Tuesday. The report covers 1997 through 2001.

Overall, about 91 percent of employment bias lawsuits were successfully resolved through settlement agreements, favorable court orders and decisions.

"Our selection of cases, our preparation and our intent to make sure that our limited resources are well-invested are some of the drivers for our high success rate," EEOC Chairwoman Cari M. Dominguez said Monday. "We take so few cases to litigation. We're quite selective and deliberate as to which cases we take forward."

The commission evaluates litigation success based on injunctive relief - court orders immediately stopping discriminatory practices; relief for victims including jobs, back pay and other benefits; and changes to discriminatory policies and practices by employers.

The agency's success rate on appeal of trials is 80 percent, compared to a 16 percent success rate for private bar lawyers, the report said.

The study also showed that:

  • 1,963 lawsuits were filed by the EEOC in the past five years.

  • 570 cases were filed on behalf of a class and another 1,212 were filed on behalf of individuals.

  • Of the suits filed, 30 percent were for sex discrimination, 22 percent were for retaliation, 13.5 percent were for race discrimination; 12.8 percent were disability discrimination and 8.2 percent were for age discrimination.

    Dominguez said age and disability discrimination account for the fastest-growing segments of the cases because of the growth of the aging population.

  • The EEOC obtained $409.7 million in monetary benefits through litigation, with an average monetary benefit of $263,945. That compares with $585.9 million obtained through the administrative enforcement process, with an average monetary benefit of $24,632.77.

"When all things fail, and we believe that there's been an egregious act perpetrated against victims of discrimination, we believe litigation has a very important role to play," Dominguez said. "It should send a signal that the EEOC is not averse to using that when it advances the public's interest."

EEOC Files Age Bias Suit Against Honeywell

Associated Press – June 10, 2002

NEWARK -- A federal agency has sued Honeywell International on behalf of former workers with AlliedSignal's consumer car care unit who were terminated or demoted during a companywide reorganization.

The lawsuit, filed Thursday by the Equal Employment Opportunity Commission, alleges a class of sales representatives at AlliedSignal Automotive Aftermarket either were terminated or demoted in a 1997 reorganization because of their age. In many instances, younger workers with less experience were retained or offered those positions.

Honeywell acquired AlliedSignal through a 1999 merger. The merged company is based in Morris Township.

The car care unit manufactures Prestone and Fram automotive products. The lawsuit was filed in U.S District Court in New Jersey by the EEOC's Philadelphia district Office.

Jacqueline McNair, the EEOC attorney overseeing the case, said senior management at then-AlliedSignal encouraged a pattern of discrimination against older workers, with the company president referring to workers older than 40 as dinosaurs.

The suit alleges the vice president for sales considered workers with 20 or more years' service as part of a company problem. "Those people will be bugs on AlliedSignal's windshield. Most of the older workers make too much money for a `sales rep' and we have to address that," the suit quotes the vice president as saying.

EEOC said it filed suit after efforts to reach a voluntary settlement failed.

Honeywell spokesman Tom Crane said AlliedSignal carefully conducted the restructuring.

"We're confident that there was no discrimination against any of the individuals bringing the allegation against us, or any of the other individuals who were part of the restructuring at the time," he said.

Anyone Can Become a Victim of Harassment

The Charlotte Observer – by Vernease Herron Miller - May 29, 2002

(5/28/02) - Twenty years and 20 pounds ago I had the perfect job, chief operating officer of a for-profit health care management firm. International business ventures provided the opportunity to enjoy the upper rungs of corporate benefits including travel and prestige. I loved my corporate life. I was the right age with the right credentials and had every reason to expect that I could break through the glass ceiling to the six-figure salary level I had always dreamed about.

One Monday morning in May at the end of my weekly operations report to the president, CEO owner of the company, I was informed that there was another item to be added to the agenda. My boss said that he wanted to meet me that evening at a hotel in town. I assumed that he wanted me to join him for a business meeting with a client so I asked whom we were meeting. Mr. CEO responded that we would not be meeting anyone. Only the two of us would be present.

Still oblivious to what was occurring, I asked what would we discuss that evening that couldn't be covered now in our regular meeting. He laughed and said that we weren't going to discuss anything. Then with a smirk he added a comment that would change my life forever. "You are the only person in this company that I do not control. You don't owe me anything and I can't predict how you will respond if I would need you to react in a certain way. So I have decided to make you my (expletive deleted)."

I was stunned to say the least. Never before had I been so insulted, humiliated and belittled. As a member of the first generation of black women to have cohort corporate career opportunities, I was very used to being mentored, not harassed. Without hesitating, I firmly told him that he could save himself a trip to town. I would not be meeting him at any hotel that evening.

He laughed again and said that if I didn't come he was going to fire me on Friday. I replied that wouldn't be necessary. I handed him the keys to my office as I quit. And that was the end of my perfect job.

Every day men and women enter a workplace where they are subjected to sexism, sex discrimination, sexual and quid pro quo harassment, and hostile work environments created by supervisors and co-workers. It a daily emotional and physical gauntlet that forces workers to endure unwelcome, offensive, hostile and intimidating behavior that adversely affects their ability to do their jobs.

While sensitivity to this issue has increased in the post-Anita Hill years, harassment remains a pervasive problem in American workplaces. The number of sexual harassment charges filed with EEOC has increased from 6,883 in fiscal year 1991 to a high of 15,836 in fiscal year 2000, with a slight modification to 15, 475 in fiscal year 2001. The number of racial harassment charges increased during the same period from 28,820 in 1998 to 28,912 in 2001. Many complainants experience multiple types of discrimination.

There were 80,840 total charges for eight different types of discrimination filed with EEOC in 2001, resulting in compensation in excess of $53 million, not including monetary awards obtained through litigation. That's a lot of bad behavior.

The effects of harassment can be devastating, often changing the lives of the victims in dramatic ways.

In my case, I decided that life in the fast lane wasn't worth it. I dumbed down, stopped wearing makeup on a daily basis, and left my best clothes in the closet to be worn in my private life. Having lost my will to compete, I jumped off the corporate ladder preferring instead the protective confines of academia.

One Monday morning in May a long time ago, I had to choose between integrity and abusive subjection to a corporate thug. I decided that four-star hotels, limousines and frequent flyer miles were not worth the loss of personal self-esteem and dignity.

I share my story because it is important to know that anyone can be a victim of harassment.

Sexual and racial harassment are not limited by age or gender. Supervisors and employers must be sensitive to the unusual. Men can be victims and women harassers.

There are specific enforcement guidelines regarding vicarious employer liability for unlawful harassment.

Victims should be encouraged to take definitive action. Follow internal corporate grievance procedures and then contact the EEOC at (704) 344-6682 for information or additional help. Information is also available at

Vernease Herron Miller

Allstate’s Pension Blunders

New York Times – by Joseph B. Treaster – May 19, 2002

(5/18/02) – A federal agency has concluded that the Allstate Insurance Company was illegally discriminating against about 650 life insurance agents even as it was negotiating to settle similar charges involving thousands of agents who sell auto and home insurance, several agents and the company disclosed yesterday.

In a letter to both sides in the dispute dated May 10, Lynn Bruner, a district director of the Equal Employment Opportunity Commission, said Allstate had engaged in "unlawful interference, coercion and intimidation" against the life insurance agents in 2000 and 2001.

According to the E.E.O.C., the company required agents to convert from being employees with health and pension benefits into independent contractors. Ms. Bruner said Allstate had acknowledged telling the agents they would not be permitted to work for the company unless they agreed in writing not to sue for any kind of employment discrimination. Such an action is a form of illegal pre-emptive retaliation, she said in the letter, which urged the company and the agents to begin settlement talks.

For nearly two years, Allstate has been fighting similar claims that it forced thousands of auto and home insurance agents to become independent contractors. Those agents sued Allstate in Federal District Court in Philadelphia in August. In December, the E.E.O.C. also sued Allstate.

Allstate has in turn sued the agents for fraud, saying they got severance or other benefits after agreeing not to sue the company, but never intended to honor their agreements. Susan Rosborough, an Allstate lawyer, said the company, the country's second-largest seller of auto and home insurance after State Farm, treated its agents properly and legally. The company says it wants to make its sales force more efficient and is increasing commissions to compensate for the elimination of benefits. But Michael Wilson, the lead lawyer in the agents' private suit, said their earnings as independent contractors were not making up for the losses in benefits.

The initial complaints from the home and auto insurance agents were based on age discrimination. More than 90 percent of them were more than 40 years old. More than 80 percent of the life insurance agents are that old. Both of the commission's cases cover a wide range of employment discrimination offenses.

Lawyers who specialize in suing corporations on behalf of workers portrayed Allstate as arrogant in its persistence. "If an employer gets a finding based on a certain type of practice, normally, you would expect the employer to be very cautious about doing it again," said L. Steven Platt, a Chicago lawyer who is president of Workplace Fairness, a group that provides information to workers.

But Ms. Rosborough said Allstate continued converting employees into contractors under the belief that the commission was wrong. "We don't understand their theory of retaliation," she said.

Felix Miller, the lead E.E.O.C. lawyer in the case involving the larger group of agents, said the retaliation concept was simple: agents were required to sign a release giving up their right to sue under antidiscrimination employment laws. "If an agent refused to sign," he said, "Allstate said: `Goodbye. We're not even going to consider keeping you as a sales agent.' We found that to be unlawful retaliation."

But Ms. Rosborough said, "The way we look at it, their jobs were going to go away whether they signed the release or not."

There were two types of jobs, she said — one with full benefits, the other with opportunities to make more money. "We essentially said, Job A is going away," she said. "You have a number of options. If you wanted to apply for Job B, in this case the independent contractor job, you had to sign the release."

With Allstate maintaining its position, there seems to be little hope for a negotiated settlement with the 650 life insurance agents. Whether the E.E.O.C. will eventually sue Allstate over the second group is unclear.

The commission's action against Allstate comes as its leadership and attitudes are shifting in a direction potentially more favorable to corporations. Dominated by Clinton appointees until recently, the agency has filed more than 400 discrimination lawsuits annually in three of the last four years.

But Republicans are on their way to gaining a majority on the agency's five-member board. Cari M. Dominguez, the current chairwoman, appointed by President Bush, has begun to emphasize mediation over litigation. Legal experts say the number of lawsuits is likely to decline.

At Allstate's annual shareholders meeting in Chicago on Thursday, Edward M. Liddy, the chief executive, called lawsuits "a plague on corporate America."

"We conduct ourselves in a most ethical way," he said.

Barry L. Hutton, an Allstate vice president, said it was common for companies to require departing employees to promise in writing not to file lawsuits.

But Mr. Miller, the lawyer for the E.E.O.C., said the big distinction in Allstate's case was that most of the agents were not leaving the company. "This was a situation where you were signing a release in order to stay," he said.

$2.2 Million Settlement for Genetic Tests

Associated Press – by Leigh Strope – May 18, 2002

Burlington Northern and Santa Fe Railway Co. will pay $2.2 million to 36 employees the railroad sought to genetically test in secret, settling the first federal challenge involving such testing and privacy.

The Fort Worth, Texas-based railroad was accused in February 2001 of violating the Americans with Disabilities Act by testing or attempting to genetically test workers without their knowledge after they had submitted work-related injury claims.

But the Equal Employment Opportunity Commission said in Wednesday's announcement of the mediated settlement of that lawsuit that it did not find any evidence the railroad used the tests to screen workers. The commission did say that collecting workers' DNA "may constitute a violation" of the disabilities law.

The railroad denies that it violated the law or engaged in discrimination.

"We continue to believe that none of the company's actions were contrary to the law," said Matthew K. Rose, chairman, president and chief executive of the company.

The railroad agreed not to use genetic tests in required medical exams of its employees. It will provide more ADA training to its medical and claims employees, and will have management review the company's major medical policies and practices. Test samples will be returned to workers and medical records will be purged of any reference to genetic tests.

It is not clear how often genetic information is collected, obtained or used by employers.

Nearly two-thirds of major U.S. companies require medical examinations of new hires, according to a 2001 survey by the American Management Association. Fourteen percent conduct tests for susceptibility to workplace hazards, 3 percent for breast and colon cancer and 1 percent for sickle cell anemia, while 20 percent collect information about family medical history.

In 28 states, there are laws limiting the ability of employers to collect, use or disclose genetic information, according to the National Conference of State Legislatures. But the scope and content vary considerably. No federal law exists.

An advocacy group that supports people with genetic disorders expressed disappointment that the railroad case had not gone to trial. The settlement still requires federal court approval.

"I wish there had been a court decision because this is going to be an issue down the road, more and more," said Nancye Buelow, a board member of Washington-based Genetic Alliance. "We need some concrete laws and some concrete court decisions so that more people will come forward."

EEOC Chairwoman Cari M. Dominguez said that without the railroad's cooperation, the case "could have taken years to litigate."

The case began when a track maintenance worker in Nebraska, Gary Avary, filed a work-related injury complaint.

The railroad told him he was required to take a medical exam in which several vials of blood would be drawn. His wife, a nurse, questioned what tests required so much blood, and after numerous inquiries, was reluctantly told the exam might include some genetic workups.

Avary refused and contacted a lawyer, his union and the EEOC, which sued to stop the tests.

About 125 railroad workers had filed reports of work-related carpal tunnel syndrome, a strain injury to the wrist, hand and arm thought to be caused by repetitive motion, between March 2000 and February 2001. The company contacted 36 of those workers, telling them they had to have a medical exam. Blood was drawn from 22 of the workers and testing was completed on 15 at the time the EEOC sued.

The tests were intended to determine which workers might be genetically inclined to develop carpal-tunnel syndrome, with the hope of denying them workers' compensation benefits.

The railroad agreed to stop the testing in April 2001 after the EEOC suit, but the agency continued to investigate workers' claims. The workers were not told the nature of the tests, nor was their permission obtained, and at least one worker alleged that refusal led to termination threats.

BellSouth Age Discrimination Suit

Associated Press – January 27, 2002

ATLANTA -- BellSouth Telecommunications Corp. has agreed to pay $200,000 and enhanced retirement benefits to a former employee who alleged in a federal lawsuit she was fired because of her age.

The U.S. Equal Employment Opportunity Commission sued the company in March on behalf of Deborah Caldwell, who was dismissed in January 1999 at age 50 after 30 years at BellSouth. Caldwell, 53, now lives in Nashville, Tenn.

BellSouth Telecommunications, a wholly owned subsidiary of BellSouth, denied liability or wrongdoing in the consent decree, which U.S. District Judge Richard Story signed Wednesday.

A BellSouth spokeswoman, Necole Merritt, said the telecommunications company has policies prohibiting discrimination.

Besides $200,000 in back pay, the company agreed to credit Caldwell's service record with three years, ending this month.

Earlier this week, the telephone giant reported a 29percent drop in profits for the most recent quarter. The company pointed to severance payments to laid-off workers and poorly performing investments during a difficult recessionary year.

EEOC Can Ignore Arbitration Deals

Associated Press – by Anne Gearan – January 16, 2002

WASHINGTON - A federal anti-discrimination agency may step in to win back pay or other help for workers who have signed away the right to sue their employers, a divided Supreme Court ruled Tuesday.

The 6-3 ruling clarifies the reach of the federal Equal Employment Opportunity Commission, and curbs the ability of employers to keep workplace disputes out of the courts.

The high court held that the EEOC may sue for money in federal court on behalf of a short-order cook who was fired after he had a seizure at work. The cook had agreed when he was hired that any on-the-job dispute would be resolved by arbitration, but the EEOC can ignore that agreement, Justice John Paul Stevens wrote in the majority opinion.

The court's decision means that in some cases the EEOC can circumvent an arbitration agreement to do for an individual wronged worker what the worker is unable or perhaps unwilling to do for himself.

The EEOC is ``the master of its own case,'' and free to decide for itself whether it is in the public's interest to pursue a given lawsuit, Stevens wrote on behalf of himself and Justices Sandra Day O'Connor, Anthony M. Kennedy, David H. Souter, Ruth Bader Ginsburg and Stephen Breyer.

``It is the public agency's province, not that of the court, to determine whether public resources should be committed to the recovery of victim-specific relief,'' Stevens wrote.

Justice Clarence Thomas, who once headed the EEOC, dissented. The EEOC must ``take a victim of discrimination as it finds him,'' Thomas wrote on behalf of himself, Chief Justice William H. Rehnquist and Justice Antonin Scalia.

``I cannot agree that the EEOC may do on behalf of an employee that which an employee has agreed not to do for himself,'' Thomas wrote.

EEOC 4 - 2001