Supreme Court Case Could Affect Scope of EEOC Subpoenas

District courts more strictly scrutinize how much information the agency requests in its subpoenas

Allen Smith, J.D. By Allen Smith, J.D. February 22, 2017
Supreme Court Case Could Affect Scope of EEOC Subpoenas

​What employer information is relevant under an Equal Employment Opportunity Commission (EEOC) charge for the purposes of an EEOC subpoena, and what constitutes an undue burden? Supreme Court justices dug into that question during oral arguments Feb. 21, though the case before the court centered on a different point of law, said Nicole Eichberger, an attorney with Proskauer Rose in New Orleans.

The central dispute in the case is what standard of review appellate courts should have over district court determinations about EEOC subpoenas.

Both the EEOC and the business it sued in the case agreed that the standard that should apply is the  "abuse-of-discretion standard"—where an appellate court will deem a district court's judgment an abuse of discretion when a judge fails to exercise reasonable and legal decision-making. Using this standard should make life easier for HR professionals, said Abad Lopez, an attorney with Dykema in Chicago. Under the abuse-of-discretion standard, appellate courts usually permit district courts to require more narrowly tailored subpoenas, as this is not a failure by district courts to exercise reasonable and legal decision-making. So, under this standard, employers have to turn over less information than other less deferential standards of review.

The EEOC argued in favor of the abuse-of-discretion standard because district courts can issue fast decisions on the scope of subpoenas so that investigations can quickly move forward. The abuse-of-discretion standard also would keep district courts' rulings from being second-guessed as much by appellate courts, which would also help prevent investigations from being slowed down.

The justices didn't just address what standard of review should be applied. They moved past the central dispute and addressed what information is relevant under an EEOC charge and what must employers provide in response to an EEOC subpoena.

Strength Test Challenged

McLane, a large consumer goods distribution company, required all new hires and all workers who were away from the physically demanding aspects of their jobs due to a medical condition for more than 30 days to undergo physical evaluations.

After taking maternity leave in 2007, Damiana Ochoa, who worked in McLane's Arizona facility, failed the evaluation three times. As a result, the company discharged her. She filed a charge of gender discrimination.

The EEOC in 2009 greatly expanded the scope of its investigation beyond her gender discrimination charge. The agency sought nationwide information about all of the 20,545 employees at 39 McLane grocery and food service distribution centers.

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The district court upheld McLane's objection to the EEOC's request for names, addresses, phone numbers and Social Security numbers for the thousands of individuals who have undergone the physical evaluation. But reviewing the district court's ruling afresh, rather than with an abuse-of-discretion standard, the 9th U.S. Circuit Court of Appeals reversed. McLane had to provide the contact information and Social Security numbers because this information could assist the EEOC in investigating sex discrimination, the appeals court decided.

In its brief, the government argued that Social Security numbers are a particularly accurate way to get contact information for individuals because a company may not have the most current address or, if the person has married or divorced, name of an employee or former employee, according to Eichberger.

Standard of Review

During the Feb. 21 oral argument, Allyson Ho, an attorney with Morgan Lewis in Dallas who argued on behalf of McLane Company Inc., said that the 9th U.S. Circuit Court of Appeals should apply an abuse-of-discretion standard to district court decisions. So did the EEOC's lawyer, Rachel Kovner, assistant to the solicitor general, Department of Justice. The Supreme Court had to appoint another lawyer, Stephen Kinnaird, with Paul Hastings in Washington, D.C., to argue the 9th Circuit's position that "de novo review"—appellate court review of a case without reference to the legal conclusions made by the district court—was the right standard.

Most circuits other than the 9th Circuit hold the view that the appellate courts should apply a deferential, abuse-of-discretion standard to district courts because district courts have more information about what is relevant to a particular case, Lopez told SHRM Online.

What's Relevant?

While the attorneys arguing the case discussed what standard of review should apply, the Supreme Court justices moved past the standard of review in enforcing a subpoena and focused on what is relevant under the charge and what constitutes an undue burden, Eichberger said.

Justice Stephen Breyer pursued what is relevant to a charge under investigation—how broad or limitless that definition may be, she noted.

Can the EEOC, under the belief that there are companies in the United States that are violating laws, "just go to every company in alphabetical order and interview every employee? Can they do that?" Breyer asked Ho.

She said, no, comparing this type of investigation to a so-called commissioner's charge investigating a widespread pattern of discrimination and noting that the EEOC has its own regulations governing what must be in a commissioner's charge.

Justice Samuel Alito Jr. asked why the contact information is not relevant to the charge. Ho answered that the physical evaluation does not mimic job duties and is taken on an exercise machine that measures resistance, range of motion, and speed and provides resistance equal to the force that the test-taker generates. This makes the test very fact-specific.

Justice Sonia Sotomayor later asked Ho, "I'm having a very hard time with your answer. I've never heard of any test that's given that's not in some way job-related. You can basically give a test that says, 'Is your hair true blonde or not?' "

"No. That's not our position," Ho answered. "We absolutely maintain that there is a business purpose. There's a business necessity for the evaluation. That is a separate question from how the evaluation operates, and the evaluation here does not mimic job duties."

Justice Ruth Bader Ginsburg asked how the contact information would shed light on the charge.

"In order to figure out whether disparate treatment occurred here, you need to talk to test-takers and see whether male and female test-takers were treated the same," Kovner said. "It's pretty clear why [McLane] abandoned the argument that it's an undue burden" to produce the contact information, she added.

"The names and the Social Security numbers of these individuals were already in the records that the company had of the tests. The company stripped out that information," she said. Apparently, this information had been redacted from the information the company did provide to the EEOC, which included the gender of test-takers, their passing scores, their failing scores and whether any adverse employment action was taken against each test-taker. The company "went to [an] added burden to not provide us with the information to identify these people by name and Social Security numbers. Additional information like addresses was also already in company databases with respect to all the people who were employed by the company."

This case is McLane Co. v. EEOC, No. 15-1248.

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