U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of Federal Operations P.O. Box 77960 Washington, DC 20013 Antony Z.,1 Complainant, v. Carolyn W. Colvin, Acting Commissioner, Social Security Administration, Agency. Appeal No. 0720140007 Hearing No. 531-2013-00129X DECISION The Agency simultaneously issued a final order and filed an appeal with this Commission regarding the class' entitlement to attorney's fees. For the following reasons the Commission REVERSES the Agency's final order. BACKGROUND In 1998, the Commission certified a class of African-American males employed at the Agency's headquarters office, who, on or after June 23, 1995, were not selected or promoted, or who were otherwise subjected to disparate treatment in regard to performance appraisals, awards, bonuses, and disciplinary actions. EEOC Appeal Nos. 01975435, 01975436, 01975437, request for recon. denied, EEOC Request No. 05981075, 05981076, 05981077 (January 22, 1999). After discovery, the case was expanded to include those who worked at Headquarters on or after January 1987. The class was comprised of approximately 2,200 individuals. On January 11, 2002, the parties entered into a settlement agreement, and on June 11, 2002, the Equal Employment Opportunity Commission Administrative Judge (AJ) assigned to the case found that the agreement was fair, adequate, and reasonable to the class as a whole. The settlement agreement provided, in pertinent part, that: I. Definitions D. Class Member(s), Class As defined by the Administrative Judge, the Class consists of all African American males employed at [Agency's] Headquarters Office in Baltimore, Maryland, who, on or after January 1, 1987, were not selected or promoted, or were otherwise subjected to disparate treatment in regard to performance appraisals, awards and bonuses, and disciplinary action. II. Scope of the Settlement Agreement C. The Administrative Judge shall retain jurisdiction over this matter for a period of 4 years after the Effective Date of the Settlement Agreement for purposes of monitoring and ensuring compliance with the Settlement Agreement. III. Non-Monetary Relief A. The parties will establish an Oversight Committee comprised of seven members. ... The Oversight Committee shall remain in existence during the 4 years that the Administrative Judge retains jurisdiction over this complaint. . . . The duties of the Oversight Committee will be to provide oversight and monitoring of the implementation of this Settlement Agreement. In carrying out its duties, the Oversight Committee may, among other things, review data provided by the Agency to monitor trends in the Agency's personnel policies and practices. .... D. The Agency agrees that its policies and practices for granting performance awards and Quality Step Increases will be fair and equitable and are consistent with merit principles. The Agency agrees that it will correct any misapplications of its policies for granting performance awards and Quality Step Increases to ensure fair and equitable distribution of such awards, consistent with merit principles. At the Agency's discretion, an expert may be retained to recommend ways to assess these policies and practices and to ensure compliance with relevant statutes, regulations, EEO principles, and applicable collective bargaining agreements in the Agency's award process. Any corrections the Agency implements will be made after providing a 30-day notice and comment period to the Oversight Committee. The Agency will provide a report to the Administrative Judge within 6 months of the Effective Date of this agreement of the actions it has taken to comply with this paragraph. The Agency may submit a supplemental report every 6 months, as needed. .... H. The Agency will collect data and compile such reports as the Oversight Committee might reasonably require to fulfill its role of monitoring the Agency's compliance with the Settlement Agreement. These reports will include, but not necessarily be limited to, the following: .... 2. quarterly reports of monetary awards, including Quality Step Increases, given to [Agency] Headquarters employees, broken down by component and the demographic characteristics of the employees receiving such awards. I. The Oversight Committee may request the services of an expert to analyze or interpret the data or reports. To the extent possible, the Agency will provide in-house statistical and economical analyses for this purpose. The Administrative Judge may direct the Agency to retain an expert or experts in the event the Agency is unable to provide the required expert analysis or does not do so within a reasonable time. The Agency will appoint and pay for the expert. Generally, the Agency will have the discretion to appoint an expert of its choice. Any dispute concerning the selection of the expert will be submitted to the Administrative Judge for resolution. IV. Monetary Relief A. The Agency will pay to the Class the total sum of six million, three hundred and fifty thousand dollars ($6,350,000), in full, complete and final satisfaction of all claims, including interest, arising out of the Class Agents' allegations of discrimination in employment practices as described in the Settlement Agreement, but excluding attorney fees, expenses and costs. B. Class Counsel has devised a formula for distributing the proceeds of this settlement. Six million, three hundred and fifty thousand dollars ($6,350,000) will be paid by the Agency in accordance with the Formula attached as Appendix A.2 V. Compliance Either party may bring an application before the Administrative Judge if it believes that the other party has not complied with its or their obligations under the Settlement Agreement pursuant to 29 C.F.R. § 1614.504. As contemplated in the regulatory section cited above, prior to bringing any non-compliance matter to the Administrative Judge, the complaining party must notify the other party and meet and confer in a good faith effort to resolve the conflict. The Agency shall be responsible for payment of any attorney's fees and expenses, as proven by current documentation, incurred by Class Counsel in the event the Administrative Judge concludes that the Agency has failed to comply with the terms of the Settlement Agreement. On June 9, 2006, the class filed a Motion for Enforcement, alleging that the Agency failed to provide a complete statistical analysis, as provided in III(I). Moreover, the class alleged that the Agency had delayed in designating an expert, delayed in providing an analysis, and failed to provide corrective action in response to the statistically significant problems which were revealed by the expert. The class also maintained that the Agency had not provided a written report analyzing the expert's findings, and asked that the Agency be ordered to complete the analysis within ten days. Ultimately the class filed an appeal with the Commission on March 6, 2008, regarding their claim that the Agency failed to comply with the terms of the class settlement agreement. The appeal was the subject of the prior appellate decision in EEOC Appeal Nos. 0120081816, 0120081817, 0120081818 (April 28, 2011). In our prior decision, the Commission found that the Class' Motion for Enforcement was timely raised with the AJ and that the class also timely brought its concerns to the attention of the Agency. The Commission also found that the Agency substantially complied with the provisions which required it to provide statistical and economic analyses, and even if there were some unintentional delay, there was no indication of bad faith. However, the Commission noted that a July 2006 analysis found African-American males employed at the Agency's Headquarters in Baltimore, Maryland from April 1, 2003, to September 30, 2005, were underrepresented as compared with their peers with respect to honor awards, monetary awards, and Quality Step Increases. The Commission stated the Agency had not challenged the results of the report, nor did it provide any purported explanation for the statistically significant findings. Accordingly, the Commission found that the Agency failed to ensure that its policies and practices for granting performance awards and QSIs were fair and equitable between April 1, 2003, and September 30, 2005. Additionally, the Commission found the Agency failed to comply with the term that required it to "correct any misapplication of its policies for granting performance awards and Quality Step Increases to ensure fair and equitable distribution of such awards, consistent with merit principles." Specifically, the Commission stated that despite the Commissioner's September 8, 2006 response describing actions which would be taken, there is no evidence these new procedures, which would supposedly correct the misapplication of its performance awards and QSIs which resulted in the underrepresentation of African American males from April 1, 2003 - September 30, 2005, were actually ever implemented. Accordingly, the Commission found the Agency breached provision III(D) of the Settlement Agreement, and found the class was entitled to specific enforcement of the class settlement agreement. Accordingly, the Commission found that all African-American males working for the Agency's Headquarters in Baltimore, Maryland from April 1, 2003 through September 30, 2005, were presumptively entitled to the average honor award, monetary award, and QSI received during the relevant time. The Commission noted that the Agency could rebut the presumption by clear and convincing evidence that the employee was not entitled to relief. The Commission remanded the matter to an EEOC AJ to oversee the processing of that relief. The Commission ordered that when processing the relief, the AJ should determine the total amount of honor awards, monetary awards, and QSI's awarded to all employees working at the Agency's Headquarters Office in Baltimore, Maryland from April 1, 2003 through September 30, 2005. The Commission directed that total amount should then be divided by the total number of employees who received awards during the relevant time frame, to determine the average honor, monetary, and QSI awarded. The Commission stated that the resulting amount should then be awarded to each African-American male who worked for the Agency's Headquarters office in Baltimore, Maryland from April 1, 2003 through September 30, 2005, unless the Agency showed by clear and convincing evidence that an employee was not entitled to such relief. Finally, the Agency was ordered to provide evidence that it had taken these actions. In addition to this relief, the Commission stated the class was entitled to an award of reasonable attorney's fees incurred in the processing of the breach claim. The Commission ordered the Agency to process the class' attorney's fees claim in accordance with 29 C.F.R. § 1614.501. The Agency filed a request for reconsideration of the Commission's decision. In EEOC Request Nos. 0520110501, 0520110502, 0520110499 (December 18, 2012), the Commission denied the Agency's request for reconsideration and the Commission's decision in EEOC Appeal Nos. 0120081816, 0120081817, 0120081818 became final. Thereafter, on January 17, 2013, the class submitted a Request for Payment of Attorney's Fees to the Agency, which sought payment for the work of the class' attorneys litigating the breach action from May 30, 2006, to January 17, 2013. On February 19, 2013, the class submitted a supplemental request that covered the period of January 18, 2013, through February 19, 2013. On March 7, 2013, the Agency sent a letter and indicated that it would be incorporating the supplemental request into the January 17, 2013 request, and that it would be issuing a final decision on the class' fee request by April 17, 2013. An EEOC AJ was assigned to handle the remand proceedings. On March 20, 2013, the AJ issued an Order setting forth policies and procedures for the ongoing compliance action. In his Order, the AJ determined "[t]he Class is entitled to have all appropriate costs, fees and expenses for this compliance proceeding paid by the Agency." The AJ stated that "[n]o later than 45 days after the issuance of this Order, and quarterly thereafter, the Class must submit to the Agency a request for payment of costs, fees and expenses." The Order stated the Agency had 30 days to pay the class the amount it did not dispute and to submit its objections to the AJ for any amount it disputed. On April 15, 2013, the class submitted its First Quarterly Fee Petition. The class sought payment of fees and costs for the period of January 18 - March 30, 2013. On April 17, 2013, the Agency issued a final decision addressing the fees requested for work performed by the class' attorneys from May 2006 through February 19, 2013. The Agency awarded the class $101,073.66 in attorney's fees and $1,103.99 in costs. The class did not appeal the Agency's final decision to the Commission. On May 15, 2013, the Agency filed its Response to Class's First Quarterly Fee Request. The Agency noted the class request dealt with two distinct periods, January 18 - February 19, 2013 and February 25 - March 31, 2013. The Agency noted that the class previously submitted its fee request for the period of January 18 - February 19. The Agency stated it already addressed the request for fees for the January 18 - February 19 period in a decision issued on April 17, 2013. With regard to the request for fees after February 19, 2013, the Agency stated that neither the Commission's decision nor the settlement agreement contemplated that the class would be entitled to fees for remand proceedings. The Agency also argued that the determination of "prevailing party" status cannot take place until this matter has fully concluded. The Agency also noted that it submitted a request for an opinion from the Department of Justice's (DOJ) Office of Legal Counsel (OLC) on the legality of these proceedings. The Agency argued that the AJ could not issue an award of attorney's fees until the Agency receives an opinion from DOJ on the legality of the EEOC Order that initiated the remand proceedings. On May 22, 2013, the class filed a reply to the Agency's response rejecting the Agency's contentions. The Agency replied on May 30, 2013, reiterating its objections to the AJ awarding any attorney's fees at that stage of the remand proceedings. On July 25, 2013, the AJ issued an Order requiring the Agency to pay the class $21,711.50 in attorney's fees and $4,550.83 in costs for the period of February 20, 2013, - March 30, 2013. On August 29, 2013, the Agency issued a final order indicating it would not implement the AJ's Order. Along with the final order, the Agency sent a notice of appeal to the Commission. Current Appeal On appeal, the Agency argues the AJ's award of attorney's fees is in error because there is no legal authority for the AJ to award attorney's fees at this time and any determination on fees must wait until the remand proceedings have been concluded. The Agency notes that to obtain attorney's fees a Complainant must be a "prevailing party." The Agency claims that in the remand proceedings, the class has not succeeded on any significant issues. The Agency states that thus far, the bulk of the proceedings have been devoted to the Agency disclosing information to the class and no award distribution determinations have been made. Thus, the Agency states that a determination of "prevailing party" status cannot take place until after the matter has fully concluded. The Agency argues that it never disputed the class would be entitled to fees for the breach litigation. The Agency acknowledges that the class was due attorney's fees for work performed from May 30, 2006, to February 19, 2013, before the remand proceedings began in earnest with the March 7, 2013 status conference. The Agency notes that on June 25, 2013, it paid attorney's fees in the amount of $102,177.65 for work on the breach action through February 19, 2013. The Agency argues that instead of focusing on the Agency's compliance with the terms of the settlement agreement, the present action focuses on whom, if anyone, should receive the "average award" ordered by the Commission and what amount should be distributed. Alternatively, the Agency states that even if the class is considered a prevailing party at this time, any determination on fees should wait until the remand proceedings conclude. The Agency claims that assuming the class is a prevailing party in the remand proceeding only establishes eligibility for fees, but does not establish what a reasonable fee should be, which the Agency states must take into account the class's overall success in the proceedings. The Agency argues the class' overall success will not be known until each of the class member's entitlement to the average award is decided. In response to the Agency's brief, the class notes that the settlement agreement provides, "[t]he Agency shall be responsible for payment of any attorney's fees and expenses, as proven by current documentation, incurred by Class Counsel in the event the Administrative Judge concludes that the Agency has failed to comply with the terms of the Settlement Agreement." The class states that the Agency's position that fees and costs are not available in the post-remand proceedings is inconsistent with the language of the agreement. The class also notes that in its April 2013 final decision, the Agency awarded fees to the class for the post-remand work performed on January 18, 2013 to February 19, 2013. The class states the Agency's current position that fees and costs are not available in the post-remand proceedings is inconsistent with its prior final decision. The class also argues that no additional "prevailing party" finding is necessary. The class notes that the Commission has the authority to remand the compliance proceedings for oversight by an Administrative Judge. The class states that as this is a class action, the class must be represented by counsel in the remand proceedings to obtain the relief ordered by OFO, and the Agency is required to pay the cost of the fees incurred. The class states this is a compliance proceeding; not a merits matter. In a November 14, 2014 letter, the Agency informed the Commission that on March 28, 2013, the Agency asked the Department of Justice's Office of Legal Counsel (OLC) for an opinion on whether the Commission could legally order the Agency to pay a monetary award for breach of the provision of the settlement agreement at issue. The Agency stated that in an opinion dated August 13, 2014, OLC agreed with the Agency's position and found that the Commission had no legal authority to order the Agency to provide monetary relief to class members for breach of section III(D) of the settlement agreement. The Agency provided a copy of the OLC opinion. The Agency stated that in light of the OLC opinion, the Agency could not pay the monetary relief ordered by the Commission in this case, and in turn, could not pay the class attorney's fees and costs for their work on the remand proceeding. In response, the class argued that the DOJ opinion did not change the fact that the Commission issued a final and binding decision on this matter. The class stated the OLC opinion said nothing about whether the Agency breached the settlement agreement or the class' entitlement to continuing attorney's fees as a result of the breach. ANALYSIS AND FINDINGS We note that in EEOC Appeal Nos. 0120081816, 0120081817, 0120081818 (April 28, 2011), the Commission determined the Agency breached the class settlement agreement. The Agency filed a request for reconsideration of the Commission's decision. In EEOC Request Nos. 0520110501, 0520110502, 0520110499 (December 18, 2012), the Commission denied the Agency's request for reconsideration and the Commission's decision in EEOC Appeal Nos. 0120081816, 0120081817, 0120081818 became the Commission's final decision in this matter. We find nothing in the DOJ OLC's August 13, 2014 opinion deprived the Commission of jurisdiction to enforce a breach of the class settlement agreement. Moreover, we note that OLC's opinion does not opine as to whether the Agency breached the settlement agreement or whether the Agency owes attorney's fees as a result of the Commission's finding that the Agency breached the class settlement agreement. Thus, we find that the DOJ OLC's opinion does not preclude the Commission from addressing the class' entitlement to attorney's fees resulting from the Commission's previous breach finding. We also reject the Agency's contention that attorney's fees cannot be awarded at this time because it has not been determined that the class is a prevailing party. Rather, we find that the Commission has already determined that the class is a prevailing party because the Commission found that the Agency breached the terms of the class settlement agreement when the Agency failed to comply with the terms of the class settlement agreement which required it to ensure that its policies and practices for granting performance awards and QSIs were equitable and fair between April 1, 2003, and September 30, 2005. The Commission had also found that the Agency failed to comply with the provision of the settlement agreement which required it to correct the misapplication of its policies for granting performance awards and Quality Step Increases to ensure fair and equitable distribution of such awards, consistent with merit principles. The subject proceedings are required because the Commission directed the AJ to oversee the remand of the breach claim in order to grant the class relief determined as a result of the finding of breach of the settlement agreement. As we find the class is a prevailing party as a result of the breach finding, we determine that the class is entitled to attorney's fees and costs. Additionally, we note that Section V of the settlement agreement, in relevant part stated: The Agency shall be responsible for payment of any attorney's fees and expenses, as proven by current documentation, incurred by Class Counsel in the event the Administrative Judge concludes that the Agency has failed to comply with the terms of the Settlement Agreement. The Commission determined that the Agency breached the agreement and ordered these proceedings to remedy the breach. These proceedings are not, as the Agency argues, "a separate action" distinct from "pursuing a claim of breach", but rather are part and parcel of the breach action. The monitoring of the compliance proceedings is necessitated solely by the Agency's breach of the settlement agreement. Thus, the Agency is responsible under the agreement for "any attorney's fees and expenses" incurred in these proceedings apart from any prevailing party determination. Next, we address the merits of the Class' First Quarterly Fee Request. On July 25, 2013, the AJ issued an Order requiring the Agency to pay the class $21,711.50 in attorney's fees and $4,550.83 in costs for the period of February 20, 2013 - March 30, 2013. On appeal, the Agency does not challenge the number of hours, the hourly rate, or any of the specific costs or fees requested by the class. Upon review, we find the AJ's award of $21,711.50 in attorney's fees and $4,550.83 was appropriate.3 CONCLUSION Accordingly, the Agency's final order is REVERSED and the matter is REMANDED for further action in accordance with the Order herein. ORDER Within 30 days of the date this decision becomes final, the Agency will pay the class for reasonable attorney's fees in the amount of $21,711.50 and $4,550.83 in costs. The Agency is further directed to submit a report of compliance, as provided in the statement entitled "Implementation of the Commission's Decision." The report shall include supporting documentation verifying that the corrective action has been implemented. IMPLEMENTATION OF THE COMMISSION'S DECISION (K0610) Compliance with the Commission's corrective action is mandatory. The Agency shall submit its compliance report within thirty (30) calendar days of the completion of all ordered corrective action. The report shall be submitted to the Compliance Officer, Office of Federal Operations, Equal Employment Opportunity Commission, P.O. Box 77960, Washington, DC 20013. The Agency's report must contain supporting documentation, and the Agency must send a copy of all submissions to the Complainant. If the Agency does not comply with the Commission's order, the Complainant may petition the Commission for enforcement of the order. 29 C.F.R. § 1614.503(a). The Complainant also has the right to file a civil action to enforce compliance with the Commission's order prior to or following an administrative petition for enforcement. See 29 C.F.R. §§ 1614.407, 1614.408, and 29 C.F.R. § 1614.503(g). Alternatively, the Complainant has the right to file a civil action on the underlying complaint in accordance with the paragraph below entitled "Right to File a Civil Action." 29 C.F.R. §§ 1614.407 and 1614.408. A civil action for enforcement or a civil action on the underlying complaint is subject to the deadline stated in 42 U.S.C. 2000e-16(c) (1994 & Supp. IV 1999). If the Complainant files a civil action, the administrative processing of the complaint, including any petition for enforcement, will be terminated. See 29 C.F.R. § 1614.409. STATEMENT OF RIGHTS - ON APPEAL RECONSIDERATION (M0815) The Commission may, in its discretion, reconsider the decision in this case if the Complainant or the Agency submits a written request containing arguments or evidence which tend to establish that: 1. The appellate decision involved a clearly erroneous interpretation of material fact or law; or 2. The appellate decision will have a substantial impact on the policies, practices, or operations of the Agency. Requests to reconsider, with supporting statement or brief, must be filed with the Office of Federal Operations (OFO) within thirty (30) calendar days of receipt of this decision or within twenty (20) calendar days of receipt of another party's timely request for reconsideration. See 29 C.F.R. § 1614.405; Equal Employment Opportunity Management Directive for 29 C.F.R. Part 1614 (EEO MD-110), at Chap. 9 § VII.B (Aug. 5, 2015). All requests and arguments must be submitted to the Director, Office of Federal Operations, Equal Employment Opportunity Commission, P.O. Box 77960, Washington, DC 20013. In the absence of a legible postmark, the request to reconsider shall be deemed timely filed if it is received by mail within five days of the expiration of the applicable filing period. See 29 C.F.R. § 1614.604. The request or opposition must also include proof of service on the other party. Failure to file within the time period will result in dismissal of your request for reconsideration as untimely, unless extenuating circumstances prevented the timely filing of the request. Any supporting documentation must be submitted with your request for reconsideration. The Commission will consider requests for reconsideration filed after the deadline only in very limited circumstances. See 29 C.F.R. § 1614.604(c). COMPLAINANT'S RIGHT TO FILE A CIVIL ACTION (R0610) This is a decision requiring the Agency to continue its administrative processing of your complaint. However, if you wish to file a civil action, you have the right to file such action in an appropriate United States District Court within ninety (90) calendar days from the date that you receive this decision. In the alternative, you may file a civil action after one hundred and eighty (180) calendar days of the date you filed your complaint with the Agency, or filed your appeal with the Commission. If you file a civil action, you must name as the defendant in the complaint the person who is the official Agency head or department head, identifying that person by his or her full name and official title. Failure to do so may result in the dismissal of your case in court. "Agency" or "department" means the national organization, and not the local office, facility or department in which you work. Filing a civil action will terminate the administrative processing of your complaint. RIGHT TO REQUEST COUNSEL (Z0815) If you want to file a civil action but cannot pay the fees, costs, or security to do so, you may request permission from the court to proceed with the civil action without paying these fees or costs. Similarly, if you cannot afford an attorney to represent you in the civil action, you may request the court to appoint an attorney for you. You must submit the requests for waiver of court costs or appointment of an attorney directly to the court, not the Commission. The court has the sole discretion to grant or deny these types of requests. Such requests do not alter the time limits for filing a civil action (please read the paragraph titled Complainant's Right to File a Civil Action for the specific time limits). FOR THE COMMISSION: ______________________________ Carlton M. Hadden's signature Carlton M. Hadden, Director Office of Federal Operations January 29, 2016 __________________ Date 1 This case has been randomly assigned a pseudonym which will replace Complainant's name when the decision is published to non-parties and the Commission's website. 2 The Formula for Distribution of the settlement funds shows $2,300,000 will be paid to class members for awards and Quality Step Increases. 3 Currently there are no other Quarterly Fee Requests on appeal at the Office of Federal Operations stemming from the breach of settlement at issue in this case. Thus, we find at this time there is no undue burden on the administrative process. --------------- ------------------------------------------------------------ --------------- ------------------------------------------------------------ 2 0720140007 11 0720140007