Systemic Discrimination: EEOC’s Latest Tactic to Redress Discrimination

The EEOC announced a $20 million settlement with Walgreens based upon "systemic discrimination" against African American retail management and pharmacy employees in promotion, compensation and assignment. In addition to the monetary relief for an estimated 10,000 class members, the consent decree prohibits store assignments based on race.

The EEOC’s lawsuit is part of its Systemic Initiative launched in April of 2006 based on a Systemic Task Force Report. The Report recommends, among other things, that the agency make a "top priority" the following:

• Developing of systemic investigation plans for each District Office.                                  
• Staffing systemic investigations and litigation with agency members with specialized training.
• Creating "incentives" through performance plans to encourage investigators to "successfully identify, investigate, and litigate systemic cases."
• Linking agency charge data with EEO-1 Survey and using technology to trigger investigatory efforts and litigate cases.

According to the OFCCP Blog Spot, both the OFCCP and EEOC have made systemic discrimination and testing top enforcement priorities. However, the EEOC doesn’t have a formal definition of "systemic discrimination" but enforces it as a hybrid of traditional "pattern and practice" discrimination and disparate impact. 

No matter how the EEOC tries to repackage it, pattern and practice or disparate impact discrimination cases are not new. Most cases involve a single employee or a class of employees claiming that a facially neutral employment practice had a significant discriminatory impact on a protected class of individuals. In these situations, the Supreme Court has stated that the employee must point to some specific aspect of the employment process and then must prove that the processes caused disparate impact on the protected group.

What is new is the method that the EEOC and OFCCP are going about pursuing the claims. A rudimentary statistical review of employment data provided in the EEO-1 Report or EO Survey can now lead to a government investigation and a potential class action for systemic discrimination. Some, like Mary Swanton in her article "Offensive Measures" theorize that the EEOC (not unlike the plaintiff’s employment bar) is trying to get more bang for its buck by taking on larger class action type suites. When you combine this trend with the audit tactics that I will outline in my next posts, it looks ominous for employers.