Written Testimony of Joyce E. Margulies Margulies Employment Law Consulting

Meeting of March 20, 2013 - Development of a Quality Control Plan for Private Sector Investigations and Conciliations

Thank you for inviting me to participate in the EEOC's Public Meeting on the Development of a Strategic Enforcement Plan and to submit a written statement. I am submitting this statement on my own behalf. It is based on my nearly thirty years experience as an in-house employment lawyer with a large corporation, my conversations with others in the corporate community over the years and, more recently, representing and interacting with small to medium size business owners as a solo management-side employment law practitioner.

The way I can best contribute to this process is to focus on the area I know best; insight into how the corporate world reacts to and deals with the work of the Agency, familiarity with operational issues from having worked inside a large organization, and recent exposure to smaller businesses. As a result, my focus is more on the Agency process pre-litigation rather than on litigation priorities and process.

I know I am not familiar with all the internal workings of the EEOC so it is quite possible that suggestions I make may already have been implemented or may be unworkable. However, I am making them in good faith in the belief that a Strategic Enforcement Plan that improves the efficiency and quality of the Agency's work is better for all constituencies.

Improving efficiency and quality is vital for the Agency to have credibility with employer respondents; court decisions that lambast the Agency make it more difficult for attorneys for corporations and business owners to persuade their clients to respect the Agency and its mission.

I have learned since leaving the corporate world that, not surprisingly, small to medium size business owners deal with a different set of issues than do large corporations. For the smaller business owner, receiving an EEOC charge can make the difference between making a profit and taking out a loan. The small company usually does not employ an HR professional and feels the need to hire a lawyer to handle the charge. The process is often crippling for a small company, a situation that is particularly troublesome if the employer has done nothing wrong. Any changes in Agency operations that help bring down costs to all concerned would be welcome.

The specific topics I will cover fall into several categories: (1) the investigatory process, (2) the mediation program and the conciliation process, and (3) performance management.

THE INVESTIGATORY PROCESS

1. Lack of consistency

Based on anecdotal evidence and my own experience, it appears that EEOC Field Offices do not follow consistent processes when investigating charges. While one might argue that this allows for innovation, I would suggest that consistency leads to increased efficiency, the development of common standards, the adoption of best practices and responsiveness to the needs of the various constituencies involved in the process. This would not preclude the Agency from rewarding employee suggestions for innovation that could be tested in an orderly and consistent manner through study and pilot programs.

In the corporate environment, consistency is essential to the operation of the business. It means that employees are using best practices and do not have to reinvent the wheel when confronted with an issue they, individually, have not previously seen before. Importantly, customers dealing with a variety of facilities in one organization can rely on expectations of how they will be treated and will not experience the frustrations and delays caused by a new set of procedures.

I understand that the investigatory process is included in an Instruction Manual for investigators. If this has not been done recently, I recommend that a knowledgeable team of experienced and highly regarded supervisors update it, develop checklists and clear up any areas of confusion. Hopefully, this work would result in a streamlined and clear set of processes that all investigators throughout the country would be required to follow.

An example of an area that may well not be handled consistently is whether employer position statements should be shared with charging parties, how confidential information contained in those statements should be dealt with. Likewise, there should be a uniform policy on the extent to which charging party submissions will be shared with the employer. Decisions on these and other open sensitive issues should be made at the proper level of the Agency using whatever process the law requires, shared with the employer and employee community and administered consistently by the investigators.

It also is important for the EEOC to continue its work with the OFCCP, the Department of Justice and any other relevant agency to coordinate efforts and enforce common standards.

2. Expediting the Handling of Charges

It is safe to say that everyone, employers, charging parties and the Agency, all agree that charges are not being investigated in a timely manner. This is detrimental to all concerned. For employers, consequences include loss of productivity of managers involved in the charge many of whom are devastated by the accusations made against them, loss of memory as time passes, cost and difficulty of segregating and preserving records for long periods of time and the inefficiencies of constantly re-starting an investigation whenever the investigator gets back around to your case. I am sure that this lack of timeliness impacts all other interested parties similarly, adding up to a significant cost that everyone agrees could better be spent in remedying problems.

I recommend consideration of the following solutions:

• Reinvent priority charge processing. Investigators need to understand that all charges do not have to be investigated in the same manner and they need to be highly trained to make a judgment call as to how far to pursue an investigation. If they have any doubts, they need to have an experienced and knowledgeable supervisor to call on for assistance. The Instruction Manual for investigators can provide options for processing charges and hypothetical situations.

  For charges with little merit on their face, the investigator may not need to request a Position Statement and mediation should not be an option. For example, if a charge alleges a termination because of race, and the charging party admits to having quit after a dispute with a supervisor, absent any other allegation of a work environment that could result in a constructive discharge, likely no investigation is needed. If an employee in a call center alleges she was terminated due to her sex and the employer offers to send the investigator tapes of calls she mishandled, there probably is no reason for the investigator to do an on-site to meet with the supervisor.

• Rethink the approach to subpoenas. I am sure I do not know the back story behind the overbroad subpoena cases, but it is obvious that there have been times when litigation over a subpoena has delayed processing a charge for an unacceptable amount of time. I wonder if it would be appropriate in cases in which an investigation has uncovered an issue not addressed in the charge to continue processing the charge instead of litigating over a subpoena. The Agency can always use its authority through whatever process is necessary to separately investigate the new issue.
• Consider the possibility of training individual investigators to specialize in a particular area. For example, ADA charges generally are more complex than other types of charges and there likely has been an increase in the number of ADA charges. Have an investigator who has received special training on the ADA handle as many of those charges as possible; when the ADA specialist is not handling ADA charges, he or she can handle other types of charges or if the ADA investigator is overloaded, another investigator can work on ADA cases. In other words, I am not suggesting an "ADA" (or sex harassment, etc.) unit that only does ADA but rather having someone with expertise investigate the more complex charges more often than not.
• Access to counsel. Investigators should have access to the Agency's attorneys to receive guidance on complicated issues so as to expedite the handling of the charge. I believe this may be another area where there is inconsistency among field offices.

3. Transparency

I believe employers should be told whether a charge is viewed as an "A" charge. Of course, it might be obvious if there is no invitation to mediate but an actual discussion of the categorization of the charge and the reasons behind it will allow the employer representative to better understand the breadth of an investigation, the rationale for it and the expectations of the Agency. It also will educate an employer, particularly one who does not have an HR professional, about the issue. That may lead to a quicker solution or to a change in behavior relating to a situation of which higher-ups in the organization were not previously aware.

Cynics might say that would allow the employer to hide the ball, destroy evidence, etc. However, in my experience, employers want to follow the law and correct mistakes and do it in a timely fashion. There are some rogue employers, just as there are rogue employees both at the Agency and in the general population, but if all our policies and procedures are dedicated to the bottom 10%, we all miss many opportunities.

MEDIATION AND CONCILIATION

1. Mediation

I am a strong supporter of the Agency's mediation program. I believe that it has resulted in the early resolution of cases to the benefit of employer and employee alike and has served to further the Agency's mission. I would like to see the SEP continue the focus on Alternate Dispute Resolution begun in the first National Enforcement Plan and, where possible, make it even better than it already is. I understand that there is concern that a number of employers do not agree to mediation and there is speculation as to why. In my experience and in the experience of others with whom I have spoken, here are a couple of reasons why employers do not agree to mediation:

• The cost to participate, particularly if travel is involved. If travel is not involved and a position statement will be requested, it is likely cheaper for the employer to participate in the mediation than to write a position statement. If travel is involved, the Agency may consider telephonic mediation, videoconferencing or some other creative solution. It may not be as effective as in person mediation and it may logistically be more difficult, but it could still be effective.
• I have nothing to offer - the case is ridiculous. Often, a charging party just wants to have the opportunity to tell his or her story. If a good mediator gives the CP an indication that the case is meritless, the person may withdraw the charge, having been educated as to what conduct does and does not violates the statute. If the case actually is a good one, the mediator can educate a recalcitrant employer representative. Furthermore, at times a meritless case may be resolved without an exchange of money, rather for a good reference or for just a de minimis amount. I have been able to persuade both large and small employers to mediate using these rationales.

There have been some issues regarding the quality and training of the mediators and of consistency in the handling of the cases. However, for the most part, my experience, particularly in the Memphis office, has been excellent and I have resolved every case that I have mediated. In order to improve the mediation program, I suggest the following:

• Resolution of all claims. Ensure that the employer is allowed to obtain a resolution of all claims the employee may have against it (whether or not within the jurisdiction of the Agency) if the employer is offering something of value; train mediators to know what would be an acceptable side agreement for accomplishing this. I understand that all Offices do not allow this. However, not being able to resolve all claims discourages knowledgeable employers from resolving cases.
• Mediator training and review. Ensure mediators are well trained; continue the practice of surveying both sides.
• Use outside mediators. In appropriate cases, allow the employer to pay for an approved outside mediator if there is some objection to the internal mediator. An objection I have heard is that the mediator will favor the employer as a result. Even if I thought mediators could be influenced in this manner, I don't believe this will happen since the mediator wants to continue to get the approval of the EEOC to do more mediation for it.
• Continue employer education. Field offices should educate or continue to educate employers about the advantages of a mediation program; many will not sign a Universal Agreement to Mediate but will evaluate the appropriateness of mediation on a case-by-case basis. If time permits, the assigned mediator can follow up the invitation to mediate with a call to the employer to explain the process and its advantages. Also, District Directors may want to call on individual companies to discuss the advantages of mediation, perhaps accompanied by a management attorney who was happy with the process.
• Allow mediation of all cases, even "A" cases. The objection may be that "A" cases are too important not to investigate and that allowing mediation might result in a settlement that does not resolve important issues. One solution might be to hold mediation at a later point in the investigation of "A" cases - once the Agency has had an opportunity for some discovery - or perhaps there can be agreed upon discovery, followed by mediation. If necessary, allow the EEOC attorney to work with the parties and the investigator to ensure proper handling. Also, as far as I know, there is no rule preventing an agreement resulting from mediation from containing injunctive relief. It makes no sense to pursue a case that will be costly to both sides when it can be resolved early on, perhaps for more than what it will settle for later, since the employer will not have spent millions in defense.

  Employers with whom I have spoken have been frustrated by the refusal to mediate an "A" case and some suspect that the obstacle is a desire by the attorneys to file a case, get credit for it and for a litigated resolution. If that is the case, a performance management system that gives attorneys credit for pre-litigation work might be a solution. The Agency would continue to get credit for the resolution, even if it did not occur in litigation.

2. CONCILIATION

The Conciliation Process should be as significant an opportunity for resolving a case, as is the mediation process. Instead, as my and others' experience has shown and as courts have found, the conciliation process has often been a meaningless and frustrating exercise that hurts the credibility of the Agency.

• At this conciliation point in the process, the Agency appears to take the position that since it has found reason to believe that discrimination has more than likely occurred, it has no obligation to do more than make a demand for "full relief" and move to litigation if the employer does not agree. On the other hand, from the employer's point of view, it often is by no means a certainty that the Agency will be successful in the litigation and the employer believes there ought to be a discount for the uncertainties of litigation. As a practical matter and putting aside the legal arguments that can be made by both sides, in all likelihood, at some point in the litigation process, after everyone has spent a great deal of time, effort and money, a settlement likely will be reached for something less than full relief - possibly the same or similar settlement to what the employer would have been willing to do during conciliation. I believe that possibility at least should be explored during conciliation, rather than a flat refusal to discuss anything but full relief. I hope that the flat refusal to discuss is old news and has been replaced by a good faith effort to resolve the case.
• All too often, possibly due to the inexperience of the investigator or of the employer representative, there has not been a sufficient exchange of information for the employer to be in a position to go to the higher-ups in the organization and ask for what may be a substantial amount of money to resolve the charge. It is unrealistic for an employer to be asked to pay a substantial amount of money to settle a case without being told the basis for the demand. The employer representative looks like a fool if he or she has to go to the GC, the CEO or a business owner to ask for authorization for a large settlement but when asked how the relief was calculated or who was harmed, be unable to explain. Both the Agency and the employer representative have no credibility.

3. PERFORMANCE MANAGEMENT

Obviously, its employees accomplish the Agency's work. The quality of their performance is the deciding factor in whether the Agency can accomplish its mission. I commend the EEOC on its Performance Management Initiative since not only will it result in improved employee performance but also, the process of deciding what to evaluate helps refine thinking about Agency priorities.

Most businesses, small or large, use performance evaluation systems to focus employees on the issues that matter to the company, evaluate them on that basis and reward them on how they perform in those areas. An employee knows that there will be recognition and possibly a monetary award (not always, in these economic times), if they perform well in the areas that are being measured in the performance evaluation. In all likelihood, if an activity is important to the employer, it will appear as a performance measure; if it does not appear, an argument can be made that the employer does not expect much in that area.

For a sales person, areas of focus may be number of sales calls, sales technique (determined by a manager who accompanies the sales person on calls periodically) and amount of closed business. If paperwork completion in a timely manner is not on the list, it may be ignored by the sales person who figures the employer is more interested in the business she has sold. For an employment lawyer, the list may include quality and timeliness of advice, number of charges managed and number of no cause findings. It may not mention quality and amount of training of supervisors. In that case, the lawyer likely will not do much supervisor training.

Performance evaluations can change an organization's culture. It is one thing for a CEO to say that our culture values cooperation among our business units; we don't want our employees to work in silos, rather we want them to collaborate. That goal is raised to a whole new level and will result in a culture change if employees are evaluated on how well they accomplish it. If higher than normal salary increases (or no salary increases) or other monetary rewards are not available, other types of recognition can be identified. (See 1501 Ways to Reward Employees by Ben Nelson, PhD).

Similarly, to the extent they do not exist already or need change, updated performance measures need to be established for Agency positions. The following are some thoughts on this process:

• Consistency. The Agency should consider developing a common set of performance measures for positions that exist across the Agency. For cases where an office varies from the norm on the responsibilities of a position, of course, modify the measures.
• "Descriptive" evaluation system. A "subjective' system that permits supervisors to rate employees' performance numerically or choose an adjective without explanation is more than likely inadequate. However, it is possible to develop an evaluation system that does not just measure output completely "objectively" (how many charges did a person process, how many on-sites were done, etc.) but instead or in addition describes and evaluates how employees perform their jobs. Instead of allowing a supervisor to say that the employee did a "good" job, the supervisor will have to break down the job into tasks and describe how the employee accomplished each task. Descriptive evaluations are more time consuming but result in more useful information for the employee and, even if they have a disparate impact (which is less likely), are defensible. For example, in the case of an investigator, in addition to measuring whether the investigator met investigatory deadlines, did a certain number of investigations and other similar numerical measures, additional criteria would include how the investigator conducted the investigation, whether she interviewed key witnesses or collected the right documents to back-up an assertion made by either party, how well she analyzed the statistics, etc.
• Evaluate supervisors on how they supervise. The Agency must train supervisors on how to manage performance and evaluate them on how they perform in that role. Supervisors who manage investigators have a crucial role since they are in charge of coaching, training and managing those responsible for one of the key agency processes. Supervisors who do not perform their management and oversight responsibilities should be removed from their supervisory roles. The owner of a medium size business I met recently impressed me by the fact that her managers are required to evaluate all the employees they supervise regularly and the managers are evaluated on how well they perform that function.

CONCLUSION

The Strategic Plan contains many commendable goals and strategies. I hope that the EEOC is successful in accomplishing them since doing so will benefit the Agency and all its constituencies. Thank you again for the opportunity to contribute.