EEOC Retains Subpoena Power even after Complainants' Private Lawsuit was Dismissed

Employers beware: in a shocking decision out of the Eastern District of Wisconsin, a court has allowed the EEOC to engage in a fishing expedition to gather more evidence against a company which had already successfully defeated the employees' claims in district court.

In EEOC v. Union Pacific R.R. Co., Case No. 2:14-mc-00-52 (E.D. Wis. May 1, 2015), the Equal Employment Opportunity Commission (EEOC) began an investigation after two African American employees filed charges alleging that Union Pacific had denied them promotions because of their race. During the EEOC investigation, the complainants received a right to sue letter and filed a private lawsuit in federal court. The employers actually prevailed on summary judgment and the case was dismissed. 

The end, right? 

Wrong. 

The EEOC continued to investigate the possibility of class-wide discrimination by issuing a subpoena for additional information, but the employer, not surprisingly, refused to comply. The United States District Court for the Eastern District of Wisconsin, found, however, that the EEOC's investigation power does not end when a private lawsuit is filed or concluded. The court recognized that the EEOC has the authority to challenge any discrimination that it discovers while investigating the claims in a charge. 

This is another reminder for employers that resolution of a case with an individual plaintiff employee does not always mean the end of the dispute. The EEOC continues to work diligently on its Strategic Enforcement Plan, which, as you might imagine, involves a lot of enforcement, and as this case demonstrates, even a positive outcome in a civil court does not necessarily mean the EEOC's inquiry is over. Upon receipt of an EEOC Notice of Charge or Right to Sue letter, employers should immediately consult with counsel to ensure that the employer's rights are preserved and protected, and that appropriate steps are taken to address any ongoing investigation by the EEOC.