Dennis Anderson was terminated for violating his employer’s policy requiring employees to report their use of prescription drugs, even legal ones, that could cause dizziness or otherwise impair employees. The EEOC alleged that under the drug policy, Product Fabricators made unlawful medical inquiries of employees, failed to keep employees’ medical information confidential, and discharged the claimant because of an unlawful application of the drug policy when the claimant reported an injury while working under the influence of legal prescription drugs.
The federal court of appeals for the Eighth Circuit issued an opinion in EEOC v. Product Fabricators, Inc. ruling that a district court judge abused his discretion when rejecting a consent decree settling an ADA lawsuit brought by the EEOC. The district court had previously rejected the proposed consent decree on the basis that the EEOC had failed to identify a basis for the court to retain jurisdiction over the case for the following two years.
The EEOC and the company presented a consent decree to the court, but the court refused to approve the decree. A consent decree is a special type of settlement agreement where the court retains continuing jurisdiction, often through a number of years, in order to ensure the parties adhere to the terms of the settlement. They are typically used when a governmental agency, in this case the EEOC, brings the lawsuit, as opposed to a private party plaintiff. In reviewing this consent decree, the court agreed with Product Fabricators that the EEOC’s allegations reflected isolated incidents of discrimination. The court held that under these circumstances, the continuing supervision of the settlement that an EEOC consent decree brings was not warranted. The EEOC then took an appeal. The appeals court rejected the reasoning of the lower court and recognized the strong preference for settlement agreements and also recognized the fact that continuing jurisdiction is a usual component of consent decrees that are designed, in part, to have a deterrent effect on the employer community. John Hendrickson, the EEOC’s regional attorney in Chicago, commented, “Once the EEOC has reached a settlement with an employer accused of discrimination, continuing jurisdiction provisions enable the EEOC to ensure that defendants will comply with civil rights laws for years to come.”
This ruling reinforces the power of the EEOC to ensure compliance with its settlements by having continued district court supervision over the terms of the settlement, even when the claims may be isolated in nature. Employers who enter into consent decrees with the EEOC will likely have a district court waiting patiently in the background ready and willing to enforce the decrees.