Employers Beware: Discrimination Lawsuits Continue to Rise

​New federal data shows the U.S. Equal Employment Opportunity Commission (EEOC) is cracking down on unlawful workplace practices.

The EEOC filed 143 discrimination or harassment lawsuits in fiscal year 2023, which began on Oct. 1, 2022, and ended Sept. 30, 2023, according to a recent report by the agency. This represents a more than 50 percent increase over the filings from fiscal year 2022.

"The EEOC's litigation program is an important tool to ensure compliance with the nation's anti-discrimination laws and promote equal employment opportunity when the commission is unable to obtain voluntary compliance," EEOC Chair Charlotte A. Burrows said in a statement.

While the EEOC report did not provide details about the claims, law firm Seyfarth in Chicago analyzed information from each complaint in fiscal year 2023. According to their findings:

• The number of filings under the Age Discrimination in Employment Act (13) was more than double that of fiscal year 2022 (6).
• There were 43 hostile work environment lawsuits, 27 of which asserted harassment on the behalf of an employee's sex or sexual orientation, with another 15 alleging harassment based on race or national origin.
• Lawsuits under the Equal Pay Act experienced a slight year-over-year decrease, while filings under the Pregnancy Discrimination Act remained consistent.
• Five claims were filed related to alleged failure to accommodate mental impairments, including attention-deficit/hyperactivity disorder, anxiety, depression and post-traumatic stress disorder.

The commission filed only three lawsuits in the first four months of fiscal year 2023. But the number of claims ramped up when Commissioner Kalpana Kotagal took the helm, lodging 13 lawsuits in August and 71 in September, the Seyfarth report showed.

"The EEOC has squeezed a significant proportion of its case filings into the last few weeks for years," said Christoper DeGroff, an employment lawyer at Seyfarth in Chicago. "But this year the total volume of cases is remarkable and demonstrates the EEOC is roaring back to life."

Which Industries Had the Most Lawsuits?

Most discrimination lawsuits in fiscal year 2023 were claims under Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act (ADA), the Seyfarth report found. The agency filed 48 disability-related lawsuits, nearly doubling the 27 ADA cases it filed the previous year.

After the EEOC published guidance regarding hearing-related disabilities in the workplace in January 2023, the agency filed nine ADA cases on behalf of employees with hearing difficulties.

"The ADA is a clear favorite for EEOC filings," DeGroff said. "This is particularly problematic for employers, because the complicated intersection between disabilities and leave laws creates significant vulnerabilities for employers."

Industries that received the most lawsuits included:

• Hospitality (31 lawsuits)
• Health care (24).
• Retail (18).
• Construction/natural resources (15).
• Transportation/logistics (9).

Small businesses were also sued, including a pet store, a pet resort boarding and training service with two locations, an appliance store, a lodge in a state forest area, a small medical practice, and a used car dealership, among others. The Seyfarth report noted these small businesses may struggle to fund their legal defense against EEOC lawsuits.

[SHRM Online article: How to Avoid Discrimination Lawsuits]

Employers Should Reinforce Core Values

Since the EEOC's last anti-harassment guidelines were issued in 2016, the COVID-19 pandemic drove a lot of communications online, including formal business interactions as well as informal channels such as social media.

Now that these communications are more likely to be recorded, evidence of suspected discrimination is more widely available and would support increased filings and enforcement, according to Stephen Paskoff, CEO of training company Employment Learning Innovations in Atlanta.

"Similarly, some firms may have become more complacent in enacting preventative measures, which would further increase exposure," Paskoff said.

But he explained that employers can prevent discrimination lawsuits simply by asking themselves if they are building inclusive, welcoming cultures that set clear standards of conduct for all interactions, regardless of setting.

While conducting formal training to establish safeguards against illegal behavior is still paramount, he added, organizations should also bolster their core values. By establishing and reinforcing values such as inclusion, accountability and respectful behavior, companies can reduce exposure to potential discrimination and subsequent litigation.

"In such environments, associates would feel supported in speaking up when confronted with potentially questionable behavior," Paskoff explained. "This would help organizations identify and address incidents well before they rise to the level of systemic discrimination."