The Considerable Downside of Mediation for Discrimination Victims

Mediation is a really good deal for employers but what about workers? Not so much.

In its 2014 performance report,  the EEOC states that its mediation program for private sector complainants achieved a resolution in 7,846 out of a total of 10,221 mediations conducted for all types of discrimination. Mediation is a voluntary process where a neutral mediator assists the employer and employee in reaching an early and confidential resolution of the employment dispute raised in a charge of discrimination.  The  effort yielded  $144.6 million in monetary benefits for complainants. Simple division indicates the EEOC’s mediation effort yielded $18,430 per mediation for private sector workers in 2014.

Here are some of the many ways that employers benefit from the EEOC’s mediation program:

• Thanks to the generosity of the American taxpayer, it doesn’t cost employers anything to use this form of alternate dispute resolution. The EEOC doesn’t charge the complainant either but the complainant often has no money because s/he is the victim of illegal discrimination. There’s a difference.
• The employer  usually has a major advantage because it is  represented by an experienced attorney while the complainant often can’t afford to hire an attorney and his or her only knowledge about  the legal process is derived from television shows like Law and Order.
  • A settlement costs the employer practically nothing compared to the cost of responding to an EEOC investigation and then litigating a lawsuit , which would likely exceed $100,000. If the employer loses the case,  add on damages and  the plaintiff’s attorney fees.
  •  No one has to know! It’s all secret.

What’s the down side of mediation for the employer? There aren’t any. Even if the employer fails to achieve a settlement, the employer gains valuable information about the complainant’s case, including his or her evidence, whether the complainant is or will be represented by counsel, and whether the complainant has been so emotionally damaged by discrimination that s/he would be a poor witness in front of a jury.

Now let’s count the benefits of mediation for discrimination victim. There is only one that I can think of:

• Something is better than nothing.

Our legal system does not provide legal counsel for individuals in employment law cases and many discrimination victims have no money because they were fired or not hired for a job as a result of illegal discrimination. Moreover, the legal system has made it comically difficult  for individuals to represent themselves in a discrimination lawsuit. The law of disparate treatment discrimination is such a complicated morass that  judges reportedly are loathe to even explain the burden-shifting formula to juries out of fear of hopelessly confusing them.  An American Bar Foundation study shows that 40 percent of employment discrimination cases are dismissed when the plaintiff is pro se, compared to 11 percent when the plaintiff is represented by counsel. So individual discrimination victims often have no other viable option than mediation if they are going to salvage anything from their experience. For them, $18,430 is better than nothing.

Now for the down side of mediation for complainants, of which there are many:

• A major power imbalance favors the employer, even with a supposedly neutral mediator. Many complainants  are emotionally and financially devastated by the experience of undergoing abuse. Employers, on the other hand, have deep pockets and  access to quality representation by experienced counsel and sometimes even fully staffed legal departments.  Large employers actually budget to defend against discrimination lawsuits.
• Most complainants  have no way of knowing  whether they have a strong or a  weak case . They lack the knowledge to place a value on the damage they have suffered.  The facts are in the hands of the employer, who, for example, knows the qualifications of other applicants for a job or the ways in which a formula was rigged to  eliminate older workers in a bogus “restructuring.”  The employer would be required to provide this information to the complainant through court-ordered discovery but mediation takes place before a lawsuit is even filed , well before discovery.  The complainant is like a blind person wandering through a maze.
• The EEOC only undertakes mediation when it finds there is probable cause to believe that discrimination occurred. Mediation does not come remotely close to compensating some (probably most) discrimination victims.   For example, more than 60 percent of age discrimination charges filed with the EEOC are filed by older workers who have lost their jobs. Older workers are cast out of the workforce  into a swamp of disproportionate, chronic unemployment marked by epidemic age discrimination in hiring. Many will never find  equivalent jobs. If they  do find any job, research shows it will pay  less. An unknown number of older workers are forced into an  ill-advised early retirement because they need Social Security benefits to survive. If they retire at age 62, they will lose at least 25 percent of the monthly benefit that they would have received if they had waited until their full retirement age of 66 or the latest retirement age of 70. For them, $18,430 is better than nothing but it is virtually nothing compared to the real and lasting damage they suffer for the rest of their lives.

For the complainant, a settlement is like buying a used car without checking under the hood.

So why is the EEOC so invested in mediation when the result seems so unfair for victims of illegal discrimination?

The back story may involve America’s antiquated and outdated federal court system, which is heavily tilted toward  employers. Discrimination lawsuits are dismissed at much higher rates than other types of lawsuits and this has been the case for years. No one in the leadership ranks of the federal court system seems to care.  Moreover, in recent years, federal judges have demonstrated remarkable hostility toward the EEOC, claiming the agency is both inept and overly aggressive.  Federal legislators, too, have castigated the EEOC, while courting favor (i.e. major campaign contributions) from  the  U.S. Chamber of Commerce and big business.

All we really can know is that discrimination victims increasingly are being shuttled into mediation, which is like placing a band-aid on a broken leg.  And American workers deserve better than this.