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At our annual Labor & Employment Seminar this past spring, we promised to keep you updated on the closely watched EEOC v. CVS Pharmacy case, one of a couple cases filed by the EEOC challenging routine provisions of a severance agreement as unlawful under Title VII. Here is the latest update.
On December 17, 2015, the Seventh Circuit Court of Appeals ruled that a district court rightly dismissed the EEOC’s suit against CVS Pharmacy Inc. because the agency refused to engage in conciliation, rejecting the EEOC’s claim that this requirement only applies to individual claims. Not so, said the Court, describing the EEOC’s interpretation of its powers under Section 707(a) as “novel,” and stating that “Section 707(a) does not create broad enforcement powers for the EEOC to pursue nondiscriminatory employment practices that it dislikes.…” It gets better. The Court pointed out that the EEOC did not contend that CVS engaged in any kind of discrimination or retaliation by the mere use of its contested severance agreements “because the argument would fail.” The Court went on to say that, “Several circuit courts, including ours, have held that conditioning benefits on promises not to file charges with the EEOC is not enough, in itself, to constitute ‘retaliation’ actionable under Title VII.” You can read the decision here.
I think we can call this an unexpected gift to employers. ‘Tis the Season.
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