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Federal Register / Vol. 86, No. 9 / Thursday, January 14, 2021 / Rules and Regulations where employers agree to participate in conciliation, there is more than a 50%
chance of achieving resolution. Getting more employers to agree to participate is the first step to getting more resolutions. By providing basic information about the facts and legal arguments behind the claim, the Commission increases the likelihood that the respondent will recognize the merit of the Commissions position and conciliate.
Finally, the Commission has decided to remove from the final rule any requirement that it disclose material information that caused it to doubt its determination of reasonable cause. After reviewing the points raised by several commenters, the Commission is concerned about the potential for collateral challenges that this requirement may create. As the Commission has stated above, the purpose of this final rule is not to create or encourage potential new avenues for dilatory litigation on conciliation. Based on its review of the comments, the Commission believes the litigation risks of this part of the proposal outweigh the increase in transparency that would be achieved specifically by this provision.
The Commission expects that its personnel will continue to evaluate, weigh, and proactively address evidence that runs contrary to a reasonable cause finding in its summary under 1601.24d2. In cases where the facts or the law suggest that reasonable cause is lacking, existing protocols require field personnel not to make such a finding. And the Commissions employees adhere to these protocols and their professional obligationsin evaluating cases. For these reasons and after carefully considering the comments regarding this proposal, the Commission has removed this requirement from the final rule.
Final Regulatory Revisions
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After considering all comments received, the Commission is finalizing the proposed rule as modified in the discussion above.8 These changes will 8 As noted in the NPRM, the language in 1626.12 is slightly different in some places than the language of 1601.24 due to the different conciliation language in the ADEA. 85 FR at 64081
n. 10. This includes the fact that the ADEA does not require that conciliation start after a reasonable cause finding, so the provisions in 1601.24 that are dependent on a reasonable cause finding are not found in 1626.12. See 29 U.S.C. 626d2. A letter from former employees of the Commission took issue with the Commission using the phrase allegations in the ADEA portion of this rule. The reason that Commission used the phrase allegations instead of referencing a reasonable cause finding is because the ADEA section that describes the Commissions conciliation obligations
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bring more clarity, transparency, and consistency to the conciliation process.
They will encourage more respondents to participate and the Commission to better articulate it positions at the outset of conciliation. The final rule sets out procedures that will support the Commissions ability to meet statutory obligations to attempt to conciliate, i.e., to tell the employer about the claim essentially, what practice has harmed which person or classand provide the employer with an opportunity to discuss the matter in an effort to achieve voluntary compliance. Mach Mining, 575 U.S. at 488. As the Court noted, conciliations necessarily involve communication between parties, including the exchange of information and views. Id. This final rule ensures that the Commissions exchange of information occurs in an open, transparent manner. These changes should make the conciliation process more successful and, in so doing, enhance the Commissions fulfilment of its mission to eliminate unlawful discrimination in employment.
Regulatory Procedures Executive Order 12866
This rule has been determined to be significant under E.O. 12866 by the Office of Management and Budget because it raises novel legal or policy issues arising out of legal mandates or the Presidents priorities. The rule will not have an annual effect on the economy of $100 million or more, nor will it adversely affect the economy in any material way. Thus, it is not economically significant for purposes of E.O. 12866 review. However, the rule will have many benefits as demonstrated by the following costbenefit analysis.
The rule imposes no direct costs on any third parties and only imposes requirements on the EEOC itself. The rule, if implemented, will likely require the EEOC to conduct training of staff to ensure that it is complying with the new regulation. While these changes and training would likely be absorbed within the Commissions normal operating expenses, any additional expenses that the agency would incur could be offset by cost savings derived from these changes. For example, charging parties often file Freedom of Information Act FOIA requests with the Commission after receiving a right to sue notice in order to receive the charge file. If more cases are resolved in conciliation, these cases would not is not dependent on a reasonable cause finding, unlike Title VII. See 29 U.S.C. 626d2.

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result in right to sue notices and the Commission would receive fewer FOIA
requests, resulting in cost savings for the government.
Furthermore, while the parties ultimately determine whether a conciliation agreement is reached, if the Commission is able to conciliate more cases successfully, it will benefit employees, employers, and the economy as a whole. With respect to employees, an increase in successful conciliations will result in more employees receiving remedies for the discrimination they suffered within an accelerated timeframe. Many employees who receive reasonable cause findings are unable to obtain any relief without conciliation because they do not pursue litigation for fiscal, emotional, or other reasons, or even if they do pursue litigation, ultimately do not attain relief.
Even employees who ultimately would otherwise be successful in litigation may benefit from a conciliation because they would then receive remedies sooner and avoid the time, cost, stress, and uncertainty of litigation.
Employers will also benefit from the EEOC conciliating cases more successfully. In some cases, conciliations may provide an opportunity for employers to more quickly correct any discriminatory conduct or policies and seek compliance assistance from the EEOC.
Additionally, while employers pay $45,466 9 on average to settle cases in conciliation, they will save time, resources, and money by avoiding often costly and lengthy litigation. It is difficult to quantify the average cost of litigating an employment discrimination case for an employer because the cost of a case depends on several factors, such as the complexity of the case, length of the litigation, and the jurisdiction in which it is litigated.10
The stage at which litigation concludes has a large effect on litigation costsattorneys fees and other litigation expenses are significantly higher for cases that go through trial, as 9 This
was the average for fiscal year 2019.
analysis focuses only on an employers litigation costs because most plaintiff-side attorneys use contingency-fee arrangements for pursuing claims, in which the attorney receives a portion of the recovery and charges little or nothing if no recovery is obtained. See Martindale-Nolo Research, Wrongful Termination Claims: How Much Does a Lawyer Cost? Nov. 14, 2019, available at https
www.lawyers.com/legal-info/labor-employmentlaw/wrongful-termination/wrongful-terminationclaims-how-much-does-a-lawyer-cost.html noting that 75% of plaintiffs lawyers in employment litigation use contingency fee arrangements and another 15% use a combination of a contingency fee and hourly rate. Thus, more frequent conciliation will save litigation costs for those few plaintiffs who pay their attorneys an hourly rate.
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