The Lincoln Commission on Human Rights (LCHR) entered an award last month of $175,000 on behalf of a man who they found was discriminated against based on nationality and age.
While a six-figure judgment in favor of an employee in Lincoln is newsworthy in and of itself, the procedural back story of the case should be just as interesting to lawyers and observers of the legal system in light of recent Supreme Court decisions.
A federal judge overruled the employer’s motion to compel arbitration in the case. In a memorandum recommending the motion to compel arbitration be overruled a federal magistrate cited to the 2002 Supreme Court case, EEOC v. The Waffle House to hold that the Lincoln Commission on Human Rights was not a party to arbitration agreement and was free to pursue relief on behalf of the employee. The memorandum cited Iowa and Massachusetts cases applying Waffle House to state anti-discrimination agencies to find it applicable to the LCHR.
The ability of employees to use civil rights agencies as an end run around arbitration clauses, has taken new importance in the light of the Supreme Court’s recent Epic decision was which provided even more ability for employers to enforce arbitration agreements.
But there are some potential barriers for employees who wish to have an anti-discrimination agency pursue a discrimination claim on their behalf.
The most practical barrier is the lack of resources of civil rights agencies. In Nebraska, an employee has to wait several months before an investigator is assigned to their claim. This means that evidence gets spoiled and overworked investigators may not be as willing to pursue a case because of workload concerns. Without good evidence an agency is not going to pursue a claim on behalf of an employee in the public hearing process.
The inadequate funding of administrative agencies stems from a general hostility that many conservatives have towards the so-called “administrative state” or executive agencies that generally regulate the economy. (These same folks are deferential to executive agencies that comprise the national security state and law enforcement) This hostility is also evidenced in judicial skepticism of administrative agencies. This skepticism was on display from the Supreme Court in the Masterpiece Cakeshop decision. In Masterpiece the court found that comments made by a state human rights commissioner were sufficient evidence of bias to overturn a decision finding a business owner who refused to bake a cake for a gay wedding had committed illegal discrimination. I would expect more of that heightened scrutiny of decisions made by civil rights agencies in the future.
Finally, Waffle House may not remain controlling law. Waffle House was decided by a relatively narrow 6-3 decision with Justice Clarence Thomas writing the dissenting opinion. Legal journalist Ian Millhiser has deemed Thomas to be the most influential justice because of his long record of dissenting and concurring opinions that are increasingly being adopted as law due to changes in the composition of the court.
Since Waffle House was decided in 2002, the Supreme Court has added Chief Justice John Roberts and Associate Justices Neil Gorsuch and Samuel Alito. Gorsuch is noted for his particular hostility to administrative agencies. Supreme Court nominee and DC Circuit Court Judge Brett Kavanaugh’s views on administrative agencies allegedly aren’t as strident as those of his fellow Georgetown Prep alum, Neil Gorsuch. But an employer looking to overturn the Waffle House decision may find a friendly audience with a five-justice majority comprising Justices Roberts, Thomas, Alito, Gorsuch and Kavanaugh.