The Cost of Complaints
t's no secret that ours is an increasingly litigious society. One might think that the U.S. government could avoid the situation by hiding behind the doctrine of sovereign immunity, which bars people from suing the government unless Congress has specifically provided to the contrary. But as all federal employees, especially managers, know, such is not the case. Federal workers have found an enormous loophole in the system: the discrimination complaint.
Between 1991 and 1997, total employment in the executive branch fell by 340,000, yet during that period, discrimination complaints by federal employees filed at the Equal Employment Opportunity Commission rose by more than 60 percent. Such cases are rarely successful. Only 10 percent of cases brought to the EEOC are decided in the employee's favor.
Nevertheless, federal employees file more and more complaints, partly because they are seduced by stories of employees winning major damage awards from agencies. I have represented hundreds of employees in my law practice, and frequently they send me news clippings of significant victories won by feds in the discrimination arena. Such cases do exist, but think about it: They are rare enough to make national news, whereas a big auto crash award is unlikely to be newsworthy even in the city where it occurs. Substantial recoveries in car accident cases are commonplace.
Even if employees know their odds of winning a discrimination case are slim, they are often tantalized by the prospect of winning a huge settlement from an agency that is unwilling to endure the often lengthy, arduous process of fighting a discrimination claim. Others know they are in the right and refuse to give up on principle. But even if you have a rock-solid case against an agency, you ought to think twice about filing a complaint. Even employees who win can pay a steep price for taking on Uncle Sam.
When to Complain
When should an employee-manager, supervisor or rank-and-file worker-pursue a discrimination complaint against his or her agency? Unfortunately for "truth, justice and the American way," the fact that an employee has been wronged and would probably win the case does not automatically dictate that the employee should start the process moving. A number of other factors ought to go into the mix. Let's examine them in turn.
What agency is it? Realistically, a major component in the decision to file is not just the merits of the case but also the agency's probable reaction. As an employee's lawyer, I am far likelier to espouse filing against an agency with a history of assuming the supine than against one, such as the U.S. Postal Service, that is not known for wimpiness.
Legal costs. Federal discrimination complaints are not contingent fee cases. With hourly rates ranging from $150 to $300 per hour, expenses mount rapidly. Though the agency pays when it loses and often pays in a settlement, there is no guarantee of such payment. Since virtually no lawyer will work without a retainer, the best the client can hope for is to have to front the money. While one could successfully proceed without a lawyer at the early stages, it is difficult when and if the case reaches the discovery, let alone the hearing, stage.
The use of a non-specialist attorney may seem a good way to reduce costs through a lower hourly rate, but a generalist attorney who is not familiar with the world of federal discrimination complaints is far more apt to make a serious error to the client's detriment. In addition, the client must pay the lawyer's legal research costs, which would be far less with a federal employment specialist. Finally, for federal employees in this arena, unlike their private-sector counterparts, there is no pot of gold at the end of the rainbow. There are no punitive damages against the government. Even compensatory damages are capped at $300,000-a figure rarely attained.
Time. Between 1991 and 1997, the number of unresolved complaints rose by 102 percent in federal agencies' inventories and by an astounding 581 percent at the EEOC. Though some attempts are being made to speed up the complaint process, it is still maddeningly slow. The many iterations-informal, formal, investigation, agency decision, hearing, trial de novo, appeal-mandate patience. It is not uncommon for a discrimination complaint to drag on for years before final adjudication, and a fair number of complainants lack the necessary stamina and drop out.
Dismal odds. If an agency decides to fight and shows some intestinal fortitude, it usually wins. Employees' success rate at the EEOC is only about 10 percent. Though some agencies are prone to bellying up, there is no way to predict an agency's reaction in a particular case.
Career considerations. Though it is illegal to retaliate against someone for filing a complaint, the fact is that few managers are happy about hiring or employing someone with a history of complaint-filing, irrespective of the righteousness of the complaint. I recall from my days as a federal manager a number of instances where we tipped each other off that a particular candidate was a complaint filer and should be avoided.
Dirty little secrets. I always warn clients that if they have anything to hide, such as voucher-fudging, personal use of government property or "errors" in their SF-171, filing a complaint may bring such issues to light. Recently, a General Services Administration employee, who had filed several discrimination complaints and grievances against his boss, found his employment application documents being re-examined with a fine-toothed comb. The intense scrutiny revealed that the employee had failed to list a criminal conviction for which he had been pardoned and that he was apparently "confused" about the difference between termination and voluntary resignation with respect to a previous job. Though the complaint prompted the discovery of the misstatements, the employee's reprisal argument was rejected, and his removal was upheld by the Federal Circuit Court of Appeals.
The Pyrrhic victory. Even successfully pushing a complaint may not be in an employee's best interests. Take, for example, the case of a female manager I know who was truly the victim of sex discrimination, which kept her from getting a promotion to a GS-14 job. After a lengthy battle with her agency, she finally won a complete victory-retroactive promotion, back pay and attorney's fees. After it was all over, however, she found the atmosphere so poisonous that she took a grade bust to go to another agency. She's not sure to this day if it was worth it.
Listen to the harrowing story of a postal manager in a 1997 Merit Systems Protection Board case. The manager's career was progressing well until May 1993, when she informed her superior of her intent to file a discrimination complaint against him. Within four days and continuing over a period of 10 months, here's what he did:
- Issued a letter of warning to her;
- Detailed her to another post office;
- Referred union complaints about her to the Postal Service's internal investigations unit;
- Had her post office audited on the day after her return from the detail;
- Referred her to the USPS Employee Assistance Program for insubordination and irrational behavior;
- Told another employee she was about to be removed from the payroll;
- Issued her a second letter of warning;
- Overruled her request for an extension of time to respond to the audit report in spite of policy to the contrary; and
- Demoted and reassigned her.
The manager's complaint alleging retaliation resulted in victory, including an award of $35,000 in compensatory damages. However, as a result of what she went through, the manager suffers from anxiety and depression, chest pains, weight loss, sleeplessness, tearfulness and high blood pressure. Her marriage broke up, she is in intensive therapy and she has suicidal thoughts. According to her doctors, she will probably never return to work. With the benefit of 20/20 hindsight, should the manager have informed her boss she was going to file a complaint or should she have rolled with whatever he'd been doing?
The psychological toll. In the 1980s, a female GS-14 regional manager in a Treasury agency who is a friend of mine noted that all her male counterparts in other regions were GS-15s. In the course of disputing her grade, her entire region was abolished and she was transferred to agency headquarters. She refused to report as a GS-14 and found herself unemployed. The manager then hired a very able (and expensive) Washington federal employment lawyer and went to war with her former employer. During her five-year legal battle, she did not work and developed severe back strain from stress. Far worse was that the litigation became the central focus of her life, with family, friends and home pushed to the periphery.
In the end, the agency paid her lawyer's bill and reinstated her as a GS-15-for one day, whereupon she "voluntarily" resigned. In other words, her victory was completely symbolic. Even today, years later, when we meet I can be sure that the subject will come up, because it has left a permanent scar on her psyche. Moreover, she hates her then-manager, the person she blames for all her troubles. I know him too, and he's not a bad guy. A while back, he and I were having coffee and talking about personnel problems. He dimly recalled the woman's case but couldn't even remember her name. Complainants think "it's the offending supervisor vs. me," but it isn't. It's the entire agency, with all its resources, against which the employee is tilting his or her lance.
Why Agencies Settle
Still, thousands of employees file complaints, and many of them end up winning settlements from their agencies. A settlement, when viewed in isolation, makes great business sense for an agency. The agency not only avoids the possibility of a larger financial hit down the road but, more important, saves thousands of man-hours of managers, attorneys and personnelists whose time would be eaten up by the litigation.
Virtually all settlements have a confidentiality clause, barring the parties from disclosing what was agreed.However, we all know that the information always seems to leak out anyway. And what happens when an agency gets a reputation for settling frivolous and meritless cases? That agency is then engulfed in a sea of complaints, mostly ones that employees could not win on the merits. At some agencies, incredibly, employees are now choosing to file discrimination complaints in lieu of reaching arbitration under the negotiated grievance procedure, itself a notoriously employee-friendly method of proceeding.
There are, certainly, cases that ought to be settled. A good example of this is the case of a client of mine who complained that age discrimination was behind his failure to be selected for a promotion. When asked by the EEO investigator why he did not select my client, the selecting official said: "Because my boss told me not to pick Dale because he's too old." The response by the agency was immediate and correct: "Settle and cut our losses."
On the other hand, in a case where the agency has solid, legitimate, business-related, non-discriminatory reasons for doing what it did, a settlement will have a doubly disastrous effect: It will encourage marginal employees to file their own complaints in order to obtain what they want and will demoralize the vast majority of good people, who will observe that their hard work and good behavior have gone for naught.
Perhaps even worse, it will cause the supervisor or manager who allegedly committed the acts of discrimination to feel betrayed. It is almost impossible to convince such a manager that the agency doesn't consider him guilty, irrespective of language to the contrary in the settlement agreement. And if that's not enough, higher-level agency officials often lack the decency or courtesy to inform the alleged discriminator of the settlement or even explain the reasons for agreeing to it.
This tendency to settle stems, unfortunately, not only from legitimate factors of time, cost and ability to win, but also from sheer laziness and inertia on the part of agency personnelists and attorneys. Spinelessness on the part of upper management, especially at the political level, is another factor. I know of many cases where fear of adverse publicity and of being branded a "discriminator" has led officials to settle cases that the agency would have won.
A Strangled System
I think employees file discrimination complaints too quickly and agencies settle them too readily. The unfortunate result is the widely held perception that most complaints are bogus and that frivolous complaint-filing is a good way to get ahead. The system is being strangled by discrimination complaints with the taxpayers, the line managers and the good employees-who are the vast majority-taking it on the chin. There's one other group of victims too: legitimate victims of discrimination. Their cases are buried in the avalanche of phony ones, so that they are either denied justice or it comes so slowly as to lose much of its meaning.
All sides would do well to heed the words of U.S. District Court Judge James R. Spencer of Richmond, Va., in the 1995 case Keegan v. Dalton. In dismissing a federal employee's complaint, Spencer stated:
" This case is yet another entrant in a tiresome parade of meritless discrimination cases. Again and again, the court's resources are sapped by such matters, instigated by implacable parties and prosecuted with questionable judgment by their counsel. It is high time for this to stop."
William Rudman is an attorney specializing in federal employment law. He retired from federal service in 1993 as deputy under secretary of Defense and director of the Defense Technology Security Administration. He conducts training in federal employee discipline and performance issues for the Brookings Institution and Government Executive.