With limited resources to fight all potential employmentdiscrimination battles, the federal Equal Employment OpportunityCommission will shift its strategy from small individual cases tolarger systemic issues–some across entire industries, an EEOCcommissioner said here last week.

“Like all government agencies, EEOC has limited resources. Weneed to choose our targets carefully–especially in litigation,”said Commissioner Stuart Ishimaru, speaking in New York at theEmployment Practices and Fiduciary Liability Symposium of theProfessional Liability Underwriting Society.

“And I believe, from a law enforcement agency standpoint, weneed to make sure that we get as broad and as big a bang for ourbuck as possible,” he added, expressing the belief that to changeattitudes and deter bad employment practices, targets must bebigger than they've been in the past.

On April 4, the EEOC announced it had adopted therecommendations from an internal task force led by CommissionerLeslie Silverman that would make the fight against “systemicdiscrimination” an agencywide top priority.

In a press release announcing a strengthened “nationwideapproach to investigating and litigating systemic cases,” the EEOCdefined “systemic cases” as “pattern or practice, policy, and classcases where the alleged discrimination has broad impact on anindustry, profession, company or geographic location.”

Explaining the announcement at the PLUS meeting last week, Mr.Ishimaru told insurers and brokers in attendance the EEOC is “goingto be changing the way we do business.” He said that at a meetingin Washington a week earlier, during which the EEOC adoptedrecommendations from the task force's report (www.eeoc.gov/abouteeoc/task_reports/systemic.html), the key question addressed washow the EEOC could “better work at…going after'pattern-of-practice' cases–the bigger cases.”

An anxious defense lawyer in the audience asked what industriesand big companies are on the EEOC's hit list.

“If our program was working as well as it should [in the past],I guess I could have answered that question,” Mr. Ishimaru said,noting that one component of the revitalized systemic enforcementprogram will involve having district offices pore over data to spotproblems within industries in their regions–something they hadn'tdone in the past.

He said most employers are required to file an EEO-1 report withthe EEOC that shows the race, gender and ethnic composition oftheir workforces, noting that the EEO-1 statistics couldpotentially be used to reveal problem employers and industries.

Paul Siegel, a partner with Jackson Lewis in Melville, N.Y., whoalso spoke at the PLUS session, suggested that a past initiative ofthe EEOC, known as “Youth At Work,” had the effect of targetingsystemic problems within certain select industries.

While Mr. Ishimaru agreed that the initiative resulted in a“fair number of cases” in the fast food, retail and hospitalityindustries, the real thrust of “Youth At Work” was to educate youngpeople about basic rights and responsibilities, he said.

During the session, the commissioner highlighted his own list ofEEOC successes in dealing with systemic discrimination,including:

o A big case against Morgan Stanley over “glass-ceiling issuesand problems that women in the highest levels were having in thebanking industry.”

o A case against Abercombie & Fitch that “dealt with thechain's nationwide hiring practices that put people of color in theback room.”

o An older case against Mitsubishi in Illinois, “where there wasrampant sexual harassment on the plant floor.”

Turning to the agency's shortcomings, Mr. Ishimaru said he hadlong been troubled by the fact that offices in some regions have “adismal track record,” while others are very active in bringingcases.

“When I got to the commission [in 2003], for example, I thoughtwe would have a fairly active program for bringing race cases inthe South. With a large African-American population, you would justexpect that,” said Mr. Ishimaru, who was a civil rights lawyer atthe Department of Justice during the 1990s. He noted that you couldcount the number of race discrimination cases brought by EEOC's twomajor Southern offices “on one hand–actually on one finger.”

A fix, which is part of the new systemic enforcement initiative,will be to have better offices pair up with weaker ones, he said,explaining that the agency will “spread the expertise around” andoperate more along the lines of a national law firm.

Mr. Ishimaru also said he hoped EEOC would score some majorsuccesses in the area of hiring discrimination cases–”a tough nutto crack” in the past–revealing a personal desire to have thecommission explore the use of testers as decoys to uncoverdiscriminatory practices.

“Matched testing” procedures are performed by having jobapplicants with similar r?sum?s but different races or ethnicbackgrounds apply for the same jobs, he explained. “We areexploring ways [for] the agency [to] use testers directly orindirectly in enforcement,” he reported–suggesting, however, thatpolitics might keep such efforts from getting off the ground.

“As one of two Democrats on the commission, I get one vote outof five, and Republicans control the body,” he noted. “But it'ssomething that I have raised repeatedly and something that peopleought to be thinking about,” he added, going on to suggest thatinsurers and brokers consider using “matched testing” procedures touncover discriminatory hiring practices among clients and potentialinsureds.

Throwing out additional “proactive prevention tips” to brokersand insurers that would minimize the possibility of EEOC visits totheir customers, he told them to use the type of data the EEOCcollects in the EEO-1 forms to measure risks.

He also recommended that insurance professionals start lookingat how clients deal with work-life balance issues for employees,suggesting flexible employers that create family friendlyworkplaces will be better able to retain good workers.

Questioned about the EEOC's jurisdiction over such issues, hesaid that because responsibility for children or aging parents isoften placed on women, this can develop into a gender issue, orthat complaints might arise when workers ask for flexibility todeal with such issues and flexibility is selectively applied.

Mr. Siegel noted that when supervisors grant favors to thoseworkers they view as better workers, they open themselves up toFamily Medical Leave Act complaints.

During the session, Mr. Siegel reviewed a number of trends hebelieves are significant for employment practices liabilityinsurers. (See the accompanying “Troubling Trends”infographic.)

Compounding those headaches for employment practices liabilityinsurers, he is troubled by the fact that an increasing number ofplaintiffs' lawyers taking on employment cases are not typicalemployment lawyers, but instead may be personal injury lawyersgetting too old to chase ambulances.

“The bottom line is you're finding more and more of these casesgoing deeper. They're getting crazier, they're getting litigatedmore…like some nasty divorce cases or med mal cases, because that'swhat these [lawyers] are used to,” he said.

Therefore, they're costlier to defend, he noted, adding that“nuttier” plaintiffs' lawyers for “nuttier plaintiffs” will getsignificantly more recoveries than “normal” lawyers because the“nuttier” ones “don't have a reasonable expectation for what thecase is worth.”

At the EEOC, Mr. Ishimaru suggested that reasonability willprevail in the future.

As part of its reform efforts, EEOC has given its staff “cleardirection that if an investigation is not going anywhere–if it doesnot show likelihood of success–then we will stop and should stop.We should not be grinding into the ground for the sake of goingafter someone.”

Describing some additional changes that will take place at thecommission, he said EEOC has created an internal group of employees“to look at coordination of the whole–to make sure our resourcesaren't skewed in any one direction, such as just going after sexualharassment cases, or just going after race cases.”