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Developments at the EEOC: Damages Awards Adjusted for Inflation

Developments at the EEOC:  On June 9, 2017, the Equal Employment Opportunity Commission (EEOC) issued a groundbreaking precedential decision in Lara G. v. U.S. Postal Service, EEOC Request No. 0520130618. On its own initiative, the EEOC reopened the case to reverse prior precedent on compensatory damages awards.

Prior to Lara G., EEOC administrative judges were required to issue compensatory damages awards similar to prior EEOC damages decisions but did not make any adjustments for inflation.  Without that adjustment, the potential erosion of real value in damages awards is huge, given that the EEOC has been issuing compensatory damages awards since 1991.  For example, because of inflation, a damages award in May 2017 is worth over 43% less than the same dollar amount award than one issued in December 1991, based on government Consumer Price Index inflation statistics.

In Lara G., the Complainant had argued that EEOC administrative judges should adjust the earlier damages awards for inflation, to avoid eroding the real value of older compensatory damages awards. In earlier decisions in this case, the administrative judge and the EEOC's Office of Federal Operations (OFO) both ignored Complainant's novel legal argument.  Complainant argued that this legal argument was new and a matter of first impression never addressed in prior caselaw.  However, both the administrative judge and OFO refused to endorse the argument because of a lack of prior precedent to support it. 

The EEOC's new decision overrules the prior OFO decision in the case.  Notably, the Lara G. decision is a rare federal sector decision that was issued directly by the Commission members themselves, bearing the signature of the EEOC's Executive Secretariat rather than the Director of OFO.  The decision directs that future damage awards include an adjustment for inflation, increasing compensatory damages awards. In Lara G's case, application of that analysis increased the compensatory damages award by a further $10,000. 

Lara G. was represented by Passman & Kaplan Founding Principal Joseph V. Kaplan.

If you are a federal employee with a discrimination complaint, and wish to discuss your rights, please consider contacting Passman & Kaplan, P.C. to request an initial consultation.

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