Supreme Court Backs Companies in EEOC Clash

The U.S. Supreme Court on Wednesday buoyed companies facing the Equal Employment Opportunity Commission over potential accusations of discrimination.

In a unanimous ruling, the justices said courts have the power to enforce the statutory requirement that the EEOC try to conciliate disputes with employers before suing.

Corporate trade groups have argued that the EEOC hasn’t always engaged in “fulsome conversation” with companies when discrimination is alleged, Gerald Maatman Jr., a partner at Seyfarth Shaw LLP, said in a phone interview.

As a result of the decision, the EEOC “must change the way it approaches the process because judges can review what they did and how they did it,” Maatman said. He filed an amicus, or friend-of-the court, brief on behalf of the American Insurance Association, supporting the argument that courts should have the power to review the EEOC’s conduct in the conciliation process.

In Wednesday’s ruling, Justice Elena Kagan, writing for the court, said judicial review should be “relatively barebones,” primarily ensuring that the agency notified the employer and gave it a chance to make voluntary changes in its practices.

Even so, the ruling is a setback for the Obama administration, which argued that any judicial oversight of the conciliation process was unnecessary and would undermine the EEOC’s enforcement of federal job-discrimination laws.

The case involved Mach Mining LLC, which the EEOC accused of discriminating against female job applicants at its Johnston City, Illinois, coal mine.

Mach Mining alleged the EEOC didn’t make a good-faith effort to resolve the matter before suing and said the EEOC threatened to seek sanctions against the company’s lawyers if they sought to convince a judge that the agency hadn’t fulfilled its conciliation obligation.

The ruling will shift the balance and allow some “sunshine into the process,” Maatman said.

“We won’t be boxing with shadows as much,” he said. “Companies and lawyers will be better at making decisions based on a better quantum of information.”

The case is Mach Mining v. EEOC, 13-1019.