_________________________________________
IN THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_________________________________________
VIRGEN PARILLA,
Plaintiff-Appellee/Cross-Appellant,
v.
IAP WORLDWIDE SERVICES VI, INC.,
IAP WORLDWIDE SERVICES, INC.,
GENE LUDLOW and ROY VARNER,
Defendants-Appellants/Cross-Appellees.
______________________________________________
On Appeal from the United States District Court
for the District Court of the Virgin Islands
Case No. 02-CV-00112
______________________________________________
Brief of the U.S. Equal Employment Opportunity Commission
as Amicus Curiae Supporting Plaintiff-Appellee/Cross-Appellant
______________________________________________
JAMES L. LEE U.S. EQUAL EMPLOYMENT
Deputy General Counsel OPPORTUNITY COMMISSION
Office of General Counsel
CAROLYN L. WHEELER 1801 L Street, NW, Room 7030
Acting Associate General Counsel Washington, DC 20507
(202) 663-4724
ANNE NOEL OCCHIALINO
Attorney
TABLE OF CONTENTS
Table of Authorities . . . . . . . . . . . . . . . . . . . . .iii
Statement of Interest. . . . . . . . . . . . . . . . . . . . . .1
Statement of the Issue . . . . . . . . . . . . . . . . . . . . .2
Statement of the Case. . . . . . . . . . . . . . . . . . . . . .3
A. Nature of the Case and Court of Proceedings . . . . .3
B. Statement of Facts . . . . . . . . . . . . . . . . . .3
C. District Court Decision . . . . . . . . . . . . . . .5
Summary of Argument. . . . . . . . . . . . . . . . . . . . . . .7
Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
THE PROVISION PROHIBITING THE RESOLUTION OF CLAIMS
BEFORE AN ADMINISTRATIVE AGENCY IS UNENFORCEABLE
AS A MATTER OF PUBLIC POLICY BECAUSE IT INTERFERES
WITH THE COMMISSION'S INDEPENDENT STATUTORY
AUTHORITY TO ENFORCE TITLE VII AND OTHER CIVIL
RIGHTS STATUTES.
A. Because the provision could be interpreted as prohibiting
the filing of a charge of discrimination or assisting in an
EEOC investigation, it potentially interferes with the
Commission's law enforcement mission.. . . . . . . . 11
B. The prohibition on resolving claims before an administrative
agency violates public policy because it interferes with the
Commission's statutory obligation to seek compliance through
conciliation and litigation. . . . . . . . . . . . . 17
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Certificate of Compliance. . . . . . . . . . . . . . . . . . . 22
Certificate of Service . . . . . . . . . . . . . . . . . . . . 23
TABLE OF AUTHORITIES
Cases
EEOC v. Astra USA, Inc., 94 F.3d 738 (1st Cir. 1996) . . . 15, 16
EEOC v. Cosmair, Inc. L'Oreal Hair Care Div.,
821 F.2d 1085 (5th Cir. 1987) . .. . . . . . 11, 13, 14, 15
EEOC v. Shell Oil Co., 466 U.S. 54 (1984) . . . . . . 12, 13, 14
EEOC v. Waffle House, Inc. . . . . . . . . . . . . . . .8, 18, 19
General Tel. Co. v. EEOC, 446 U.S. 318 (1980) .. . . . 14, 18, 19
Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991) 8, 14
Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983)11
Occidental Life Ins. v. EEOC, 432 U.S. 355 (1977) . . . . . . 12
Plaskett v. Bechtel Int'l, Inc., 243 F. Supp. 2d 334 (D.V.I. 2003)5, 6, 7, 8
Town of Newton v. Rumery, 480 U.S. 386 (1987) . . . . . . . . 10
Statutes and Regulations
29 U.S.C. § 216(c) . . . . . . . . . . . . . . . . . . . . . . 18
29 U.S.C. § 217 . . . . . . . . . . . . . . . . . . . . . . . 18
29 U.S.C. § 626(a)(1). . . . . . . . . . . . . . . . . . . . . 13
29 U.S.C. § 626(b) . . . . . . . . . . . . . . . . . . . . . . 17
29 U.S.C. § 626(f)(4). . . . . . . . . . . . . . . . . . . 15, 16
29 C.F.R. § 1620.30(a) . . . . . . . . . . . . . . . . . . . . 13
29 C.F.R. § 1620.30(b) . . . . . . . . . . . . . . . . . . . . 13
42 U.S.C. § 12117(a) . . . . . . . . . . . . . . . . . . . 12, 17
42 U.S.C. § 2000e et seq. . . . . . . . . . . . . . . . . . . .1
42 U.S.C § 2000e-5(b) . . . . . . . . . . . . . . . . 10, 12, 17
42 U.S.C. § 2000e-5(f)(1) . . . . . . . . . . . . . . . . 10, 17
Miscellaneous
B. Lindemann & P. Grossman,
Employment Discrimination Law (3rd ed. 1996) . . . . . . . . . .
. . . . . . . . . . . . 13
EEOC Compliance Manual Notice 915.002, "EEOC Enforcement
Guidance on non-waivable employee rights under [ ] (EEOC)
enforced statutes," (April 10, 1997),
www.eeoc.gov/docs/waiver.html, . . 16
No. 03-2009
_________________________________________
IN THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_________________________________________
VIRGEN PARILLA,
Plaintiff-Appellee/Cross-Appellant,
v.
IAP WORLDWIDE SERVICES VI, INC.,
IAP WORLDWIDE SERVICES, INC.,
GENE LUDLOW and ROY VARNER,
Defendants-Appellants/Cross-Appellees.
______________________________________________
On Appeal from the United States District Court
for the District Court of the Virgin Islands
______________________________________________
Brief of the U.S. Equal Employment Opportunity Commission
as Amicus Curiae Supporting Plaintiff-Appellee/Cross-Appellant
______________________________________________
STATEMENT OF INTEREST
The United States Equal Employment Opportunity Commission is charged
with enforcing Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§
2000e et seq.
("Title VII") and other civil rights statutes. To carry out its
enforcement mission,
the Commission relies on employees' charges of discrimination to alert the
Commission to potential violations of the statute. Under Title VII, and other
statutes, the filing of a charge of discrimination triggers the
Commission's obligation
to investigate the charge and, if appropriate, to conciliate it. If
conciliation is
unsuccessful, the Commission may choose to enforce compliance by filing a civil
action against the employer.
The district court's decision in this case raises an important
issue concerning
the enforceability of arbitration agreements prohibiting employees
from resolving
claims before administrative agencies, which would include the Commission.
Because of the importance of this issue to the Commission's enforcement mission,
the Commission offers its views to the Court as a United States agency under
Federal Rules of Appellate Procedure 29(a).
STATEMENT OF THE ISSUE
Whether the district court erred in finding that a provision of
an arbitration
agreement prohibiting an employee from resolving claims before an administrative
agency is enforceable where enforcement would interfere with the Commission's
independent statutory authority to vindicate the public interest under
Title VII and
other civil rights statutes.
STATEMENT OF THE CASE
A. Nature of the Case and Course of Proceedings
On August 21, 2002, Plaintiff-Appellee/Cross-Appellant Virgen Parilla filed
this lawsuit against Defendants-Appellants/Cross-Appellees IAP Worldwide
Services VI, Inc., IAP Worldwide Services, Inc., Gene Ludlow, and Roy Varner
("IAP") under Title VII and Virgin Island law alleging, among other
things, that she
had been sexually harassed and terminated in retaliation for
complaining about the
harassment. A29-34 (compl.); A2 (docket). On September 16, 2003, IAP filed a
Motion to Compel Arbitration. A35 (motion). In a Memorandum Opinion and
separate Order, the district court denied the motion. A6 (memo.); A4
(order). On
April 2, 2003, IAP Defendants filed a notice of appeal. A3 (docket). On May 6,
2003, Parilla also filed a notice of appeal from the district court's
order, which is
styled case No. 03-2308.
B. Statement of Facts
On June 6, 2000, IAP Worldwide Service VI, Inc. ("IAP VI") hired Parilla as
an administrative assistant. A6 (Slip op. at 1). Upon being hired,
Parilla entered
into an Hourly Employment Agreement ("Agreement") with IAP VI that states in
relevant part, "[a]ny controversy or claim arising out of or relating
in any way to . . .
Employee's employment with Employer, or to the suspension or termination of
Employee's employment with Employer . . . shall be resolved by
arbitration and not
in a court or before an administrative agency." A44, ¶ 16 (Agreement). The
Agreement further provides that "[a]rbitrable matters include, but are
not limited to .
. . claims for wrongful or retaliatory discharge or wrongful treatment
under . . .
Federal law, including, . . . the Civil Rights Acts . . . , Title VII, the Equal
Employment Opportunity Act, the Equal Pay Act . . . the Age Discrimination in
Employment Act, the Americans with Disabilities Act . . . [and] claims for
employment discrimination under . . . Federal law." A44-45, ¶ 17 (Agreement).
The Agreement also states that the parties will pay their own
attorney's fees
regardless of the outcome of the arbitration, that the arbitrator may
order the losing
party to pay the entire cost of the arbitration, that the arbitrator
cannot come from
the Virgin Islands or Puerto Rico, that IAP must be notified of any claim within
thirty days, and, through incorporation of the American Arbitration Association
rules, that the names of the parties will be kept confidential unless
a party expressly
permitts its name to be made public. A45-45B.
In approximately July 2002, IAP terminated Parilla's employment. A31, ¶¶
19-20 (compl.). On August 21, 2002, Parilla filed suit against IAP.
A28 (compl.);
A2 (docket).
C. District Court Decision
On March 26, 2003, the district court issued a short opinion and order
denying IAP's motion to compel arbitration. A6 (memo.); A4 (order). The court
concluded that the Agreement was in all material respects identical to another
arbitration agreement at issue in Plaskett v. Bechtel Int'l, Inc., 243
F. Supp. 2d 334
(D.V.I. 2003). A7 (slip op. at 2). The court went on to state that
for the reasons
set forth in Plaskett, the motion to compel arbitration would be
denied. Id. The
district court's only substantive discussion concerned its rejection of IAP's
argument that the court should reconsider its holding in Plaskett that
the waiver of
attorney's fees is unconscionable under Title VII. A8 (slip op. at
3). Thus, the
court's decision in this case rests on the reasoning of Plaskett.
In Plaskett, the court concluded that the arbitration provisions
at issue in the
plaintiff's Hourly Employment Agreement contained multiple unconscionable terms
that permeated the arbitration provisions and could not be severed from them,
although the court concluded that the rest of the agreement (not relating to the
arbitration provisions) was enforceable. See Plaskett, 243 F. Supp.
2d at 340-46.
The court began its analysis by concluding that the parties formed an
agreement to
arbitrate. Id. at 338. The court went on to apply general contract
principles of
territorial law to determine whether the arbitration agreement at issue was
enforceable, which, the court stated, depended on whether the agreement was
unconscionable. See id. at 339.
The court concluded that three provisions of the agreement were
unconscionable: 1) the provision requiring each party to bear its own attorney's
fees, which the court found to be unconscionable since awards of attorney's fees
should ordinarily be made to prevailing parties under Title VII
(although not under
Virgin Island law); 2) the provision requiring the employee to notify
the employer of
any claim within thirty days; and 3) the provision, incorporated by
reference to the
American Arbitration Association Rules, that the names of the parties to any
arbitration award be kept confidential unless a party expressly
permitted its name to
be made public. See id. at 340-43.
The Plaskett court determined, however, that the provision stating, "'[a]ny
controversy or claim . . . shall be resolved by arbitration and not .
. . before an
administrative agency'" was not unconscionable. Id. at 343-44. In the court's
view, the provision simply barred either party from seeking "a judgment by an
administrative agency." Id. at 343. Since the EEOC brings suit in
its own name,
not that of an employee, the court reasoned that "the EEOC does not have the
authority to enter any judgment resolving any controversy or claim between the
parties." Id. at 344. Because the plaintiff could not "waive a right
that he has never
had," the court determined that this provision was not unconscionable. Id.
Finally, the court concluded that the unconscionable terms permeated the
arbitration provisions, making severance of the offending terms
inappropriate. See
id. at 345. Therefore, the court denied the defendant's motion to
compel arbitration,
although it enforced the remainder of the Hourly Employment Agreement. For the
same reasons, the court in this case denied IAP's motion to compel
arbitration but
enforced the remainder of the Agreement.
SUMMARY OF ARGUMENT
If it reaches the issue, this Court should find that the district
court erred in
concluding that the provision of the arbitration agreement prohibiting
Parilla from
resolving any claims before an administrative agency is enforceable.
Enforcement
of the provision would substantially interfere with the Commission's independent
statutory authority to vindicate the public interest by enforcing
Title VII and other
civil rights employment statutes. Therefore, this Court should
conclude that the
provision violates public policy and, consequently, is unenforceable.
Although Parilla filed a charge of discrimination, the
prohibition on resolving
claims before an administrative agency could be interpreted as
prohibiting her from
doing so. Since the Commission's authority to investigate
discrimination under Title
VII and the Americans with Disabilities Act ("ADA") is derived solely from the
filing of a charge, and because the vast majority of charges are filed
by employees,
enforcement of provisions such as this one could potentially deprive the
Commission of the opportunity to learn of alleged Title VII and ADA
violations and
could also impede the Commission's opportunity to investigate
potential violations
of the Equal Pay Act ("EPA") and the Age Discrimination in Employment Act
("ADEA"). Because a charge not only informs the Commission of alleged
discrimination against the employee filing the charge but may also alert the
Commission to other unlawful discrimination by the employer, enforcement of the
provision could also impact the Commission's ability to learn of systemic
discrimination.
Enforcement of the provision would also directly conflict with Congress's
mandate that the Commission seek compliance through conciliation and litigation
where the Commission's investigation has led it to believe that a
statutory violation
has occurred. In Gilmer v. Interstate/Johnson Lane Corp., 500 U.S.
20, 28 (1991),
the Supreme Court held that ADEA claims are arbitrable but stated that
arbitration
agreements would not prevent the Commission from seeking class-wide or equitable
relief. More recently, in EEOC v. Waffle House, Inc. 534 U.S. 279 (2002), the
Court held that even where an employee has signed a pre-employment arbitration
agreement, the Commission may seek victim-specific relief for that employee.
Thus, enforcement of the Agreement's prohibition on resolving claims before an
administrative agency contravenes Supreme Court precedent affirming that
employees' agreements to arbitrate their claims does not vitiate the
Commission's
statutory authority to vindicate the public interest by resolving employment
discrimination claims.
ARGUMENT
THE PROVISION PROHIBITING THE RESOLUTION OF CLAIMS
BEFORE AN ADMINISTRATIVE AGENCY IS UNENFORCEABLE AS A
MATTER OF PUBLIC POLICY BECAUSE IT INTERFERES WITH THE
COMMISSION'S INDEPENDENT STATUTORY AUTHORITY TO
ENFORCE TITLE VII AND OTHER CIVIL RIGHTS STATUTES.
The district court erred in concluding that the provision of the Agreement
prohibiting any claims from being resolved before an administrative agency is
enforceable. The court reached this erroneous conclusion by reasoning that "the
EEOC does not have the authority to enter any judgment resolving any controversy
or claim between the parties" and therefore that Parilla "cannot waive
a right that
[s]he has never had." Plaskett, 243 F. Supp. 2d at 344. This
reasoning reflects a
fundamental misunderstanding about the Commission's statutory authority and
utilizes an overly restrictive definition of "resolve." The
Commission may "resolve"
a charge of discrimination in several ways. First, the Commission may resolve a
charge when it fulfills its statutory mandate "to eliminate any . . .
alleged unlawful
employment practice by informal methods of conference, conciliation, and
persuasion." 42 U.S.C. § 2000e-5(b). Second, although the Commission does not
represent charging parties, the Commission may sue on behalf of a charging party
and thereby resolve a charge of discrimination through litigation or
settlement. See
42 U.S.C. § 2000e-5(f)(1). Third, upon agreement of the parties and
even before an
investigation begins, the Commission may resolve a charge through mediation.
Thus, although the Commission does not enter judgments resolving discrimination
charges, the Commission may secure resolution of discrimination charges through
conciliation and litigation, making the Agreement's prohibition on resolving
complaints before an administrative agency unenforceable.
"The relevant principle is well established: a promise is
unenforceable if the
interest in its enforcement is outweighed in the circumstances by a
public policy
harmed by enforcement of the agreement." Town of Newton v. Rumery, 480 U.S.
386, 392 (1987) (footnote omitted); see also Restatement (Second) of Contracts §
208 cmt. a (stating that the policy against unconscionable contracts
"overlaps with
rules which render particular . . . terms unenforceable on grounds of
public policy").
Here, the interest served by enforcing the provision prohibiting the
resolution of
claims before an administrative agency is the encouragement of private
settlement of
employment disputes, which is in keeping with the "liberal federal
policy favoring
arbitration agreements" manifested in the Federal Arbitration Act.
Moses H. Cone
Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983). For the reasons
discussed below, however, that interest "is outweighed by the public interest in
EEOC enforcement of the ADEA," EEOC v. Cosmair, Inc., L'Oreal Hair Care Div.,
821 F.2d 1085, 1090 (5th Cir. 1987), as well as EEOC enforcement of
Title VII, the
ADA, and the EPA. Therefore, the provision is unenforceable as a matter of law.
A. Because the provision could be interpreted as prohibiting
the filing of a
charge of discrimination or assisting in an EEOC investigation, it
potentially interferes with the Commission's law enforcement mission.
Although Parilla filed a charge of discrimination in this case,
the prohibition
on resolving claims before an administrative agency could be
interpreted as having
prohibited her from doing so and as prohibiting her from assisting in
a Commission
investigation. Such a prohibition would clearly violate public policy
by undermining
employees' statutory right to file charges and the Commission's independent
statutory authority to investigate them.
"[U]nder the procedural structure created by the 1972 amendments [to Title
VII], the EEOC does not function simply as a vehicle for conducting
litigation on
behalf of private parties; it is a federal administrative agency
charged with the
responsibility of investigating claims of employment discrimination and settling
disputes, if possible, in an informal, noncoercive fashion."
Occidential Life Ins. v.
EEOC, 432 U.S. 355, 368 (1977). Under Title VII and the ADA, the EEOC only
has jurisdiction to investigate discrimination where a charge has been
filed. See 42
U.S.C. § 2000e-5(b) (stating that "[w]henever a charge is filed by or
on behalf of a
person claiming to be aggrieved, or by a member of the Commission," the
Commission shall investigate); 42 U.S.C. § 12117(a) (adopting Title
VII procedures
under the ADA); see also EEOC v. Shell Oil Co., 466 U.S. 54, 64 (1984) ("the
EEOC's investigative authority is tied to charges filed with the
Commission; unlike
other federal agencies that possess plenary authority to demand to see records
relevant to matters within their jurisdiction, the EEOC is entitled to
access only to
evidence 'relevant to the charge under investigation'") (citation and footnote
omitted). By far, the vast majority of charges filed under these
statutes are filed by
aggrieved employees.
In contrast to Title VII and the ADA, the EEOC's investigative authority
under the ADEA and EPA is not tied to the filing of a charge. See 29 U.S.C. §
626(a) (under ADEA, stating that the Commission "shall have the power to make
investigations"); 29 C.F.R. § 1620.30(a)(1) (stating that under EPA
the Commission
may "investigate and gather data"). Nevertheless, the filing of
charges by aggrieved
individuals is the primary means through which the EEOC learns of possible
discrimination under these statutes as well. See, e.g., B. Lindemann & P.
Grossman, Employment Discrimination Law at 523 (3rd ed. 1996) ("Although the
government can initiate investigations sua sponte, most [EPA] investigations are
conducted in response to complaints lodged by employees.").
Thus, in contrast to "a complaint initiating a lawsuit," the
"function of a Title
VII charge . . . is to place the EEOC on notice that someone (either a
party claiming
to be aggrieved or a Commissioner) believes that an employer has
violated the title."
Shell Oil, 466 U.S. at 68. Significantly, a charge is not restricted to merely
notifying the Commission that the charging party may have been unlawfully
discriminated against. Instead, a charge "also may identify other
unlawful company
actions." Cosmair, 821 F.2d at 1090. This is true because a charging party can
allege that other co-workers have also been victims of discriminatory
actions and
because "[a]ny violations that the EEOC ascertains in the course of a
reasonable
investigation of the charging party's complaint are actionable."
General Tel. Co. v.
EEOC, 446 U.S. 318, 331 (1980) (citation omitted). Thus, prohibitions in
arbitration agreements on the filing of charges impermissibly impedes the
Commission's ability to learn not just about individual acts of
discrimination against
a charging party but also to learn about about systemic
discrimination. See Shell
Oil, 466 U.S. at 69 ("it is crucial that the Commission's ability to investigate
charges of systemic discrimination not be impaired").
The Supreme Court has recognized the statutory right of employees to file
charges, even when employees have agreed to arbitrate their claims against an
employer. In Gilmer v. Interstate/Johnson Lane Corp. the Court held
that an ADEA
claim may be subject to arbitration but stated that "[a]n individual
ADEA claimant
subject to an arbitration agreement will still be free to file a
charge with the EEOC,
even though the claimant is not able to institute a private judicial
action." Gilmer v.
Interstate/Johnson Lane Corp., 500 U.S. 20, 28 (1991) (emphasis
added). Thus, the
Court in Gilmer implicitly acknowledged that the filing of charges serves an
important public interest that survives an employee's agreement to arbitrate an
employment dispute.
The Fifth Circuit has reached the same result in an ADEA case involving the
enforceability of a waiver of the right to file a charge. See
Cosmair, 821 F.2d at
1090. In Cosmair the Fifth Circuit held that "an employer and employee cannot
agree to deny to the EEOC the information it needs to advance th[e]
public interest.
A waiver of the right to file a charge is void as against public
policy." Cosmair, 821
F.2d at 1090; cf. EEOC v. Astra USA, Inc., 94 F.3d 738, 745-47 (1st
Cir. 1996) (in
preliminary injunction action under Title VII where EEOC was already
investigating
three charges of discrimination against employer, holding that no
significant risk of
irreparable harm existed where settlement agreement prohibited employees from
filing charges).
Congress reaffirmed the strong public policy against interfering with the
EEOC's enforcement efforts when it enacted the Older Workers Benefit Protection
Action of 1990 ("OWBPA"). This act states in part that "[n]o waiver agreement
may affect the Commission's rights and responsibilities to enforce
this chapter" and
that no waiver may "justify interfering with the protected right of an
employee to file
a charge." 29 U.S.C. § 626(f)(4). Although the OWBPA concerns waivers, the
public policy principles underlying Congress' explicit affirmation of employees'
right to file a charge and the Commission's right and responsibility
to enforce the
ADEA – regardless of any waiver they may have signed – are the same as those at
stake in pre-employment arbitration agreements. Therefore, to the
extent that the
Agreement in this case may be read to prohibit the filing of a charge of
discrimination, it is clearly unenforceable as a matter of public policy.
Similarly, to the extent that the Agreement's prohibition on
resolving claims
before an administrative agency can be construed as a prohibiting Parilla from
assisting the Commission in its investigation, the provision is
unenforceable. See,
e.g., 29 U.S.C. § 626(f)(4) (stating that no waiver of ADEA claim may "justify
interfering with the protected right of an employee to . . . participate in an
investigation or proceeding conducted by the Commission"); Astra, 94
F.3d 738. In
Astra, the EEOC sought a preliminary injunction under Title VII to prevent the
employer from enforcing provisions of settlement agreements
prohibiting employees
from assisting the EEOC in its investigations. Astra, 94 F.3d at
740-41. The court
held that "non-assistance covenants which prohibit communication with the EEOC
are void as against public policy." Id. at 745. In reaching its
conclusion, the court
stated that "if victims of or witnesses to sexual harassment are
unable to approach
the EEOC or even to answer its questions, the investigatory powers that Congress
conferred would be sharply curtailed and the efficacy of investigations would be
severely hampered." Id. at 744. Noting that the Commission acts not
just on behalf
of private parties but also to vindicate the public interest, the
court further stated,
"any agreement that materially interferes with communication between an employee
and the Commission sows the seeds of harm to the public." Id.
(citation omitted);
see also EEOC Compliance Manual Notice 915.002, "EEOC Enforcement
Guidance on non-waivable employee rights under [ ] (EEOC) enforced statutes,"
(April 10, 1997), www.eeoc.gov/docs/waiver.html, ("An employer may not interfere
with the protected right of an employee to file a charge, testify,
assist, or participate
in any manner in an investigation, hearing, or proceeding under Title
VII," the ADA,
the ADEA, or the EPA).
B. The prohibition on resolving claims before an administrative agency
violates public policy because it interferes with the Commission's
statutory obligation to seek compliance through conciliation and
litigation.
On its face, the Agreement's prohibition on resolving claims before an
administrative agency precludes the Commission from resolving
Parilla's Title VII
claim through conciliation or litigation. This provision runs afoul
of Congress'
mandate, as expressed in Title VII, the ADA, and the ADEA, that the Commission
seek voluntary compliance through conciliation and, when necessary, through
litigation. See 42 U.S.C. §§ 2000e-5(b) (under Title VII, stating that if the
Commission determines "that there is reasonable cause to believe that
the charge is
true, the Commission shall" attempt conciliation), 2000e-5(f)(1) (if
conciliation is
unsuccessful, "the Commission may bring a civil action"); 42 U.S.C. § 12117(a)
(under ADA, adopting the "powers, remedies, and procedures" of 42 U.S.C §
2000e-5); 29 U.S.C. § 626(b) (under ADEA, stating that Commission must attempt
conciliation before instituting any action). See also 29 C.F.R. § 1620.30(a)(6)
(stating that under the EPA, the Commission may initiate and conduct
litigation).
Therefore, the provision violates public policy and is unenforceable.
The 1972 amendments to Title VII authorized the Commission to bring suit
against private employers. "In so doing, Congress sought to implement
the public
interest as well as to bring about more effective enforcement of
private rights."
General Tel., 446 U.S. at 325-26. The amendments did not, however, transfer to
the Commission all responsibility for enforcing private rights. See id. at 326.
Instead, individuals are also able to bring their own actions to
enforce Title VII.
See id. "These private-action rights suggest that the EEOC is not
merely a proxy
for the victims of discrimination." Id. Thus, while the Commission may seek
victim-specific relief, the Commission "is guided by 'the overriding
public interest
in equal employment opportunity . . . asserted through direct Federal
enforcement.'"
Id. (quoting 118 Cong. Rec. 4941 (1972)). Therefore, "[w]hen the EEOC acts,
albeit at the behest of and for the benefit of specific individuals,
it acts also to
vindicate the public interest." Id. (footnote omitted); see also
Waffle House, 534
U.S. at 296 (stating that when the EEOC decides to bring an enforcement action,
"the agency may be seeking to vindicate a public interest, not simply
provide make-
whole relief for the employee, even when it pursues entirely
victim-specific relief").
Pre-employment arbitration agreements entered into by employees and
employers do not vitiate the Commission's authority – and, indeed, its statutory
obligation – to vindicate the public interest by enforcing Title VII
and other statutes
through conciliation and litigation. See Waffle House, 534 U.S. 279;
Gilmer, 500
U.S. 20. As discussed supra, in Gilmer the Supreme Court held that ADEA claims
may be subject to arbitration. Gilmer, 500 U.S. at 35. In rejecting
the argument
that arbitration does not adequately further the purposes of the ADEA because
arbitration does not allow for equitable relief and class actions, the
Supreme Court
stated, "it should be remembered that arbitration agreements will not
preclude the
EEOC from bringing actions seeking class-wide and equitable relief."
Gilmer, 500
U.S. at 32 (emphasis in original).
More recently, in EEOC v. Waffle House the Supreme Court held that the
EEOC may seek not only class-wide and equitable relief where an employee has
signed a pre-employment arbitration agreement, but that the Commission may also
seek victim-specific relief. See Waffle House, 534 U.S. 279. In reaching that
conclusion, the Court stated that "[t]here is no language in the
statutes or in either"
Occidental Life or General Telephone "suggesting that the existence of an
arbitration agreement between private parties materially changes the EEOC's
statutory function or the remedies that are otherwise available."
Waffle House, 534
U.S at 288. When weighing the policy goals of the FAA against the language of
Title VII and the arbitration agreement the plaintiff had signed, the
Court further
stated:
No one asserts that the EEOC is a party to the contract, or
that it agreed to arbitrate its claims. It goes without
saying that a contract cannot bind a nonparty.
Accordingly, the proarbitration policy goals of the FAA
do not require the agency to relinquish its statutory
authority if it has not agreed to do so.
Id. at 294. Thus, in this case, the IAP Agreement's prohibition on
resolving claims
before an administrative agency contravenes the teachings of Waffle
House in that
the Supreme Court has expressly held that the EEOC may pursue victim-specific
relief even where an employee has signed an arbitration agreement.
In short, the Agreement's prohibition on resolving claims before an
administrative agency prevents the remedial principles of Title VII
and other civil
rights statutes from being effectuated by interfering with the Commission's
independent statutory authority to serve the public interest by
resolving complaints
of unlawful employment discrimination. CONCLUSION
The provision of the Agreement between Parilla and IAP VI that
prohibits the
resolution of claims before an administrative agency directly contravenes the
statutory framework and principles of Title VII and the other civil
rights statutes
enforced by the Commission by interfering with the Commission's statutory
authority – and obligation – to vindicate the public interest by
eradicating unlawful
employment discrimination. Therefore, the provision violates public
policy and is
unenforceable as a matter of law.
Respectfully submitted,
JAMES L. LEE
Deputy General Counsel
CAROLYN L. WHEELER
Acting Associate General Counsel
__________________________
ANNE NOEL OCCHIALINO
Attorney
U.S. EQUAL EMPLOYMENT
OPPORTUNITY COMMISSION
1801 L Street, NW, Room 7030
Washington, DC 20507
(202) 663-4724
CERTIFICATE OF COMPLIANCE
I certify that this brief complies with the type-volume
limitation set forth in
Fed. R. App. P. 32(a)(7)(B). This brief contains 4,380 words.
____________________________
ANNE NOEL OCCHIALINO
August 7, 2003 CERTIFICATE OF SERVICE
I certify that on August 7, 2003, I served two copies of this
brief by mailing
them overnight mail to the following:
K. Glenda Cameron, Esq.
LAW OFFICES OF LEE J. ROHN
1101 King St., Ste. 2
St. Croix, Virgin Islands 00820
Attorney for Plaintiff-Appellant
Francis J. D'Eramo, Esq.
NICHOLAS NEWMAN LOGAN & E'ERAMO, P.C.
1131 King St.
Christiansted, St. Croix
U.S. Virgin Islands
00820-4971
Attorney for Defendant-Appellee
____________________________
Anne Noel Occhialino
Attorney
U.S. EQUAL EMPLOYMENT
OPPORTUNITY COMMISSION
Office of General Counsel
1801 L Street, NW, Room 7030
Washington, DC 20507
(202) 663-4724
