[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]


                    H.R. 4959, EEOC TRANSPARENCY AND
                     ACCOUNTABILITY ACT, H.R. 5422,
                   LITIGATION OVERSIGHT ACT OF 2014,
                      AND H.R. 5423, CERTAINTY IN
                        ENFORCEMENT ACT OF 2014

=======================================================================

                                HEARING

                               BEFORE THE

                 SUBCOMMITTEE ON WORKFORCE PROTECTIONS

                         COMMITTEE ON EDUCATION
                           AND THE WORKFORCE

                     U.S. House of Representatives

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

           HEARING HELD IN WASHINGTON, DC, SEPTEMBER 17, 2014

                               __________


                           Serial No. 113-67

                               __________

  Printed for the use of the Committee on Education and the Workforce
  
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                COMMITTEE ON EDUCATION AND THE WORKFORCE

                    JOHN KLINE, Minnesota, Chairman

Thomas E. Petri, Wisconsin           George Miller, California,
Howard P. ``Buck'' McKeon,             Senior Democratic Member
    California                       Robert C. ``Bobby'' Scott, 
Joe Wilson, South Carolina               Virginia
Virginia Foxx, North Carolina        Ruben Hinojosa, Texas
Tom Price, Georgia                   Carolyn McCarthy, New York
Kenny Marchant, Texas                John F. Tierney, Massachusetts
Duncan Hunter, California            Rush Holt, New Jersey
David P. Roe, Tennessee              Susan A. Davis, California
Glenn Thompson, Pennsylvania         Raul M. Grijalva, Arizona
Tim Walberg, Michigan                Timothy H. Bishop, New York
Matt Salmon, Arizona                 David Loebsack, Iowa
Brett Guthrie, Kentucky              Joe Courtney, Connecticut
Scott DesJarlais, Tennessee          Marcia L. Fudge, Ohio
Todd Rokita, Indiana                 Jared Polis, Colorado
Larry Bucshon, Indiana               Gregorio Kilili Camacho Sablan,
Lou Barletta, Pennsylvania             Northern Mariana Islands
Joseph J. Heck, Nevada               Frederica S. Wilson, Florida
Mike Kelly, Pennsylvania             Suzanne Bonamici, Oregon
Susan W. Brooks, Indiana             Mark Pocan, Wisconsin
Richard Hudson, North Carolina       Mark Takano, California
Luke Messer, Indiana
Bradley Byrne, Alabama

                    Juliane Sullivan, Staff Director
                Megan O'Reilly, Minority Staff Director
                                
                                ------                                

                 SUBCOMMITTEE ON WORKFORCE PROTECTIONS

                    TIM WALBERG, Michigan, Chairman

John Kline, Minnesota                Joe Courtney, Connecticut,
Tom Price, Georgia                     Ranking Member
Duncan Hunter, California            Raul M. Grijalva, Arizona
Scott DesJarlais, Tennessee          Timothy H. Bishop, New York
Todd Rokita, Indiana                 Marcia L. Fudge, Ohio
Larry Bucshon, Indiana               Mark Pocan, Wisconsin
Richard Hudson, North Carolina       Mark Takano, California
                           
                           C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on September 17, 2014...............................     1

Statement of Members:
    Courtney, Hon. Joe, Ranking Member, Subcommittee on Workforce 
      Protections................................................     8
        Prepared statement of....................................    10
    Walberg, Hon. Tim, Chairman, Subcommittee on Workforce 
      Protections................................................     1
        Prepared statement of....................................     7

Statement of Witnesses:
    Clements, Lynn, A. Director, Regulatory Affairs, Berkshire 
      Associates, Inc., Columbia, MD.............................    12
        Prepared statement of....................................    14
    Dreiband, Eric, S., Partner, Jones Day, Washington, DC.......    42
        Prepared statement of....................................    44
    Foreman, Michael, L., Director, Civil Rights Appellate 
      Clinic, Pennsylvania State University, Dickinson, The 
      Dickinson School of Law, State College, Pa.................    28
        Prepared statement of....................................    30
    Lloyd, William, F., General Counsel, Deloitte LLP, New York, 
      NY.........................................................    21
        Prepared statement of....................................    23

Additional Submissions:
    Mr. Courtney:
        Appendix A: Report, Public Outreach and Education Efforts 
          Concerning EEOC Guidance on Arrest on Convictions 
          Records................................................    75
        Appendix B: The Unvarnished Truth: 2014 Top Trends in 
          Employment Background Checks...........................    92
        Letter dated Oct. 9, 2014 from Cox, Todd, A., Director, 
          Office of Communications and Legislative Affairs, Equal 
          Employment Opportunity Commission......................   120
    Fudge, Hon. Marcia, L., a Representative in Congress from the 
      State of Ohio:
        Prepared statement of....................................   139
    Chairman Walberg:
        Letter dated Sept. 16, 2014 from Hartman Sims, Celia, 
          Vice President, Government Relations, Knowledge 
          Universe...............................................     4
        Letter dated Sept. 16, 2014 from Lucas, M. A., Executive 
          Director, Early Care and Education Consortium..........     6
        Letter dated Sept. 17, 2014 from nineteen stakeholders...    59
        Letter dated Sept. 25, 2014 from Dombi, William, A., Vice 
          President for Law, National Association for Home Care & 
          Hospice................................................   142
        Letter dated Oct. 1, 2014 from Johnson, Randel, K., 
          Senior Vice President, Labor, Immigration and Employee 
          Benefits...............................................   150
        Letter dated Oct. 22, 2014 from Heriot, Gail, Member, 
          United States Commission on Civil Rights...............   156

 
                    H.R. 4959: EEOC TRANSPARENCY AND
               ACCOUNTABILITY ACT; H.R. 5422: LITIGATION
                 OVERSIGHT ACT OF 2014; AND H.R. 5423
                  CERTAINTY IN ENFORCEMENT ACT OF 2014

                              ----------                              


                     Wednesday, September 17, 2014

                     U.S. House of Representatives

                 Subcommittee on Workforce Protections

                Committee on Education and the Workforce

                            Washington, D.C.

                              ----------                              

    The subcommittee met, pursuant to call, at 10:03 a.m., in 
Room 2175, Rayburn House Office Building, Hon. Tim Walberg 
[Chairman of the subcommittee] presiding.
    Present: Representatives Walberg, Kline, Rokita, Hudson, 
Courtney, Fudge, Pocan, and Takano.
    Staff present: Molly Conway, Professional Staff Member; Ed 
Gilroy, Director of Workforce Policy; Callie Harman, Staff 
Assistant; Christie Herman, Professional Staff Member; Nancy 
Locke, Chief Clerk; James Martin, Professional Staff Member; 
Daniel Murner, Deputy Press Secretary; Brian Newell, 
Communications Director; Krisann Pearce, General Counsel; 
Lauren Reddington, Deputy Press Secretary; Molly McLaughlin 
Salmi, Deputy Director of Workforce Policy; Alissa Strawcutter, 
Deputy Clerk; Juliane Sullivan, Staff Director; Loren Sweatt, 
Senior Policy Advisor; Alexa Turner, Legislative Assistant; 
Tylease Alli, Minority Clerk/Intern and Fellow Coordinator; 
Melissa Greenberg, Minority Labor Policy Associate; Eunice 
Ikene, Minority Labor Policy Associate; Brian Kennedy, Minority 
General Counsel; and Leticia Mederos, Minority Director of 
Labor Policy.
    Chairman Walberg. A quorum being present, the Subcommittee 
on Workforce Protections will come to order. Good morning. Let 
me begin by welcoming our guests and thanking our witnesses for 
joining us today. We will discuss a number of legislative 
proposals that would bring greater transparency and 
accountability, I trust, to the Equal Employment Opportunity 
Commission (EEOC).
    We are here because every member of this Committee 
recognizes the EEOC as a vitally important agency. It has a 
responsibility to protect the right of all workers to a fair 
shot at employment opportunities and a workplace free of 
discrimination. That is what America is about. This is a 
fundamental human right each and every one of us holds dear. No 
one should be denied a job, have their wages cut, or passed 
over for a promotion because of their race, their gender, 
religion, or disability. We are here because we want the EEOC 
to do its job and, more importantly, to do its job effectively.
    That is why, in recent months, we have made oversight of 
EEOC a priority. Because we know men and women are being 
discriminated against. We know bad actors would rather put 
their own hateful prejudice before the talent and the 
experience of each individual worker. It isn't right, and it is 
EEOC's mission to help stop that from happening. Unfortunately, 
in recent years the EEOC has shifted its focus away from that 
vital mission. Instead, it has spent a great deal of time and 
resources advancing a deeply flawed enforcement and regulatory 
agenda.
    Employers have fallen under EEOC's intense scrutiny without 
any allegation of employment discrimination. Charges are being 
filed in federal court with little to no evidence of 
wrongdoing. Federal judges have harshly and appropriately 
criticized the agency for its shoddy legal work. Each day, the 
agency harasses employers without cause, and every case tossed 
out of court for legal malpractice is another lost opportunity 
to help victims of employment discrimination. It means the 
veteran, the injured and disabled, while serving our country, 
will continue waiting for his or her day in court. It means the 
single mom who worked long and hard to earn a promotion will 
continue waiting for her day in court.
    More than 70,000 individual complaints are sitting in front 
of the Commission. The backlog represents thousands of private 
sector workers who believe their rights were violated and who 
are waiting anxiously for the Commission to do its job. As the 
old saying goes, justice delayed is justice denied. It is time 
to stop denying these men and women the justice they deserve. 
Not only is the EEOC dropping the ball with its misguided 
enforcement priorities, it is also pursuing a regulatory scheme 
that is making it more difficult for employers to protect 
employees and consumers.
    In recent years, states and localities have adopted 
policies to protect Americans in vulnerable situations that 
come in contact with workers, such as at home and in the 
classroom. The EEOC has eviscerated these efforts. Quite 
simply, the agency's edict restricting the use of criminal 
background checks is putting people in harm's way, including 
women and children. It is time the agency changed course, and 
that is precisely what the legislation before us is intended to 
do. Among other provisions, the proposals will help shine more 
sunlight on EEOC activities, compel the agency to work with 
employers in good faith to resolve complaints, force the 
commissioners to do their job and oversee the agency's 
enforcement actions, and provide a safe harbor to employers 
complying with federal, state and local mandates, such as laws 
requiring criminal background checks during the hiring process.
    These are common sense reforms and should enjoy 
overwhelming bipartisan support. By supporting the legislation, 
you are supporting transparency at a vitally important federal 
agency. By supporting the legislation, you are supporting the 
ability of states to promote a safe and responsible workforce. 
By supporting the legislation, you are supporting an effort to 
get this agency back on track to better protect the rights of 
America's workers. I urge my colleagues to support a more 
effective, accountable, Equal Employment Opportunity Commission 
by supporting this legislation.
    I would like to thank my colleague, Representative Hudson, 
for his leadership on this important issue. Again, we are 
grateful to our witnesses for joining us, and I look forward to 
our discussion.
    Before I recognize the senior Democrat of the Committee, I 
would like to ask for unanimous consent to include in the 
record letters from interested stakeholders supporting the 
bills we are discussing today, including letters from 
KinderCare learning centers and the Early Care and Education 
Consortium in support of H.R. 5423, the Certainty in 
Enforcement Act of 2014.
    [The information follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
        
    Chairman Walberg. With that, I will now yield to my friend 
and colleague, Representative Joe Courtney, for his opening 
remarks.
    [The statement of Chairman Walberg follows:]

   Prepared Statement of Hon. Tim Walberg, Chairman, Subcommittee on 
                         Workforce Protections

    Good morning. Let me begin by welcoming our guests and thanking our 
witnesses for joining us. Today we will discuss a number of legislative 
proposals that would bring greater transparency and accountability to 
the Equal Employment Opportunity Commission.
    We are here because every member of the committee recognizes the 
EEOC is a vitally important agency. It has a responsibility to protect 
the right of all workers to a fair shot at employment opportunities and 
a workplace free of discrimination. This is a fundamental human right 
each and every one of us holds dear. No one should be denied a job, 
have their wages cut, or be passed over for a promotion because of 
their race, gender, religion, or disability.
    We are here because we want the EEOC to do its job, and more 
importantly, to do its job effectively. That is why in recent months we 
have made oversight of EEOC a priority, because we know men and women 
are being discriminated against; we know bad actors would rather put 
their own hateful prejudice before the talent and experience of each 
individual worker. It isn't right and it is EEOC's mission to help stop 
it from happening.
    Unfortunately, in recent years, the EEOC has shifted its focus away 
from that vital mission. Instead, it has spent a great deal of time and 
resources advancing a deeply flawed enforcement and regulatory agenda. 
Employers have fallen under EEOC's intense scrutiny without any 
allegation of employment discrimination. Charges are being filed in 
federal court with little to no evidence of wrongdoing. Federal judges 
have harshly and appropriately criticized the agency for its shoddy 
legal work.
    Each day the agency harasses employers without cause and every case 
tossed out of court for legal malpractice is another lost opportunity 
to help victims of employment discrimination. It means the veteran, 
injured and disabled while serving our country, will continue waiting 
for his day in court. It means the single mom, who worked long and hard 
to earn a promotion, will continue waiting for her day in court.
    More than 70,000 individual complaints are sitting in front of the 
commission. The backlog represents thousands of private-sector workers 
who believe their rights were violated and who are waiting anxiously 
for the commission to do its job. As the old saying goes, ``justice 
delayed is justice denied.'' It's time to stop denying these men and 
women the justice they deserve.
    Not only is the EEOC dropping the ball with its misguided 
enforcement priorities, it is also pursuing a regulatory scheme that is 
making it more difficult for employers to protect employees and 
consumers. In recent years, states and localities have adopted policies 
to protect Americans in vulnerable situations who come in contact with 
workers, such as at home and in the classroom. The EEOC has eviscerated 
these efforts. Quite simply, the agency's edict restricting the use of 
criminal background checks is putting people in harm's way, including 
women and children.
    It's time the agency changed course and that's precisely what the 
legislation before us is intended to do. Among other provisions, the 
proposals will help shine more sunlight on EEOC activities, compel the 
agency to work with employers in good faith to resolve complaints, 
force the commissioners to do their jobs and oversee the agency's 
enforcement actions, and provide a safe harbor to employers complying 
with federal, state, and local mandates, such as laws requiring 
criminal background checks during the hiring process.
    These are commonsense reforms that should enjoy overwhelming 
bipartisan support. By supporting the legislation, you are supporting 
transparency at a vitally important federal agency. By supporting the 
legislation, you are supporting the ability of states to promote a safe 
and responsible workforce. By supporting the legislation, you are 
supporting an effort to get this agency back on track to better protect 
the rights of America's workers.
    I urge my colleagues to support a more effective, accountable Equal 
Employment Opportunity Commission by supporting the legislation. I 
would like to thank my colleague, Representative Hudson, for his 
leadership on this important issue. Again, we are grateful to our 
witnesses for joining us and I look forward to our discussion.
    Before I recognize the senior Democrat of the subcommittee, I would 
like to ask for unanimous consent to include in the record letters from 
interested stakeholders supporting the bills we are discussing today, 
including letters from KinderCare Learning Centers and the Early Care 
and Education Consortium in support of H.R. 5423, the Certainty in 
Enforcement Act of 2014.
    With that, I will now yield to my colleague, Representative Joe 
Courtney, for his opening remarks.
                                 ______
                                 
    Mr. Courtney. Thank you, Chairman Walberg, and thank you to 
all the witnesses for finding time to join us here today. And 
again, at the outset just so I don't forget, I would just ask 
unanimous consent to submit a statement from Congresswoman 
Marcia Fudge, who is over at the Agriculture Committee. They 
are having a hearing today that conflicts with her attendance, 
but she was very adamant she wanted to make sure her passionate 
comments are entered for the record.
    [The statement of Ms. Fudge follows:]

 Fudge, Hon. Marcia, L., a Representative in Congress from the State of 
                                  Ohio

    Chairman Walberg, Ranking Member Courtney, and members of the 
Committee:
    I appreciate the opportunity to submit this statement for the 
record to express my opposition to this package of bills offered by the 
majority. These bills are aimed squarely at stifling the work of the 
Equal Employment Opportunity Commission (EEOC).
    Fifty years ago we passed the Civil Rights Act of 1964, which 
established the EEOC. When employees believe they have been 
discriminated against at work, they rely on this Commission to 
investigate the merits of each allegation to the fullest extent. 
Although litigation is a critical component to the success of the 
EEOC's mission to stop and remedy unlawful employment discrimination, 
it is the last stage in a process that includes multiple attempts to 
resolve an allegation of discrimination. In fact, the EEOC has been 
able to consistently obtain monetary and nonmonetary relief for victims 
in 90% of its cases.
    The package of bills proposed by the majority each place grave 
limitations on the ability of the EEOC to achieve its goals. While the 
intent of these bills is to prevent the EEOC from ``overreach'', the 
end result will simply make it harder for the agency to fulfill its 
statutory duties through administratively burdensome and duplicative 
information gathering. Of the most egregious bills offered, however, is 
H.R. 5423, The Certainty in Enforcement Act of 2014.
    If enacted H.R. 5423 would amend Section 703 of the Civil Rights 
Act, going far beyond background checks and criminal background checks, 
to allow states and localities to exploit requirements currently 
protected under the Voter Rights Act. In effect, states and localities 
would be exempt from Title VII employment discrimination liability.
    This is clearly a step backward in our civil rights laws.
    Tasked with enforcing the federal laws which combat illegal 
discrimination against an employee on the basis of race, color, 
religion, sex, national origin, age, disability or genetic information, 
the EEOC has drastically expanded the diversity of America's workforce. 
It is my hope that as the Committee hears from today's witnesses, my 
colleagues will recognize the harm these bills will have on employers 
and businesses across the country.
                                 ______
                                 
    Chairman Walberg. Hearing no objection, and appreciating 
these comments, they will be entered.
    Mr. Courtney. Thank you, Mr. Chairman. Mr. Chairman, this 
summer we celebrated the 50th anniversary of the 1964 Civil 
Rights Act, one of the most significant steps in the fight for 
equality in this nation's history. Title VII of this landmark 
law outlaws workplace discrimination on the basis of race, 
color, religion, sex, or national origin. These provisions help 
ensure that American workers are judged on the work they do, 
not on who they are, where they are from or what they look 
like. Yet even with all the progress we have made in the last 
50 years, there is much more work to be done.
    Too many Americans suffer from discrimination by their 
employer even today. For example, just last year there were 
nearly 100,000 new charges of discrimination filed with the 
EEOC, including 1,019 Equal Pay Act charges and over 67,000 
Title VII charges. I was hopeful when the subcommittee began to 
examine the work of EEOC last year we would look at ways to 
join together to strengthen our civil rights laws and build 
upon the critical improvements made through measures like the 
Americans With Disabilities Act amendments and the Genetic 
Information Nondiscrimination Act. Instead, I would argue, we 
are wasting time here with a set of misguided bills that impede 
the operations of the EEOC and attempt to gut Title VII, 
turning the clock back on civil rights protections enacted more 
than 50 years ago.
    These bills would decimate the EEOC's ability to safeguard 
American workers from discrimination, violate long-standing 
rules regarding attorney/client confidentiality and do a great 
disservice to the nation. We just heard opening comments 
talking about how justice delayed is justice denied. If you 
look at what these bills do, and I am 27 years as a litigator 
before I came to Congress, in the name of transparency it would 
cripple the ability of a client of the Commission to deal with 
their attorney in terms of engaging in any kinds of 
administrative action or litigation strategy. It would, in the 
name of oversight, basically force the Commission to 
micromanage every decision in terms of commencing litigation. 
How that, on earth, would end delayed process makes any sense, 
again, I think just common sense tells you that would add 
additional steps and delay in terms of the agency being able to 
execute its duty.
    And lastly, 5423--which basically turns the federal 
supremacy clause on its head and puts state laws as a 
preemptive safe harbor for employers--in my opinion, on the 
50th anniversary of the Civil Rights Act, is grotesque. I mean, 
this is allowing a race to the bottom in terms of states who 
don't--haven't stepped up and enacted laws to protect people 
from racial discrimination, from gender discrimination. And 
those states exist out there. And to basically empower them to 
override the national commitment that we made 50 years ago to 
uphold equal treatment under the law for people who are simply 
trying to get ahead in their--in life--as employees. It is just 
unbelievable to me.
    The process that we are engaged in here today, sadly, is 
par for the course in terms of the way this subcommittee has 
operated. Our side got notice of this hearing eight days ago. 
The 14-day courtesy rule for the Commission, which is well 
understood--you know, we know that for the last three and a 
half years--was deftly avoided by the majority. We get one 
witness that we can invite to testify, and I thank Mr. Foreman 
for being here to, again, in an unbalanced lineup, defend a 
position which I think, you know, we will hear loud and clear 
here today. But, you know, what is missing here today is the 
agency.
    And all we had to do was, frankly, pick up the phone and 
call our side with enough notice and we could have accommodated 
that. And actually had a real dialogue today to talk about what 
is actually happening out there with the department. What I 
think we are gonna hear is that despite all the claims of, you 
know, overzealous litigation and ineffective outcomes, we are 
going to see an agency which did great work in 2013 in terms of 
recovering damages for workers who were discriminated against. 
That the number and percentage of cases that went all the way 
to litigation is less than 1 percent. So, frankly, we are 
chasing a problem which I am--certainly, from the standpoint of 
Congress doesn't exist.
    If there are individual cases out there where people are 
unhappy with the agency, I think all of us are more than happy 
to accept those calls, accept that mail, intervene with the 
Secretary. You know, the Chairman knows we have had two 
instances this year where we have been successful in terms of 
getting the Secretary to pull back cases of overzealous 
enforcement of various laws. So it is not like we are dealing 
with an agency that refuses to respond or listen to reasonable 
points of view in terms of criticisms of the way they operate.
    So, you know, I mean, we have 72 hours left before--
everybody in this building knows we are going home until after 
the election. So we are bringing up legislation which, you 
know, it is just not the appropriate response to any of the, 
maybe, concerns that people are expressing here today to 
actually talk about passing a bill which would short-circuit a 
case that is pending before the Supreme Court. I mean, it is 
just--it is embarrassing, from my standpoint. This is not what 
Congress should be focused on right now in terms of people 
across this country who are struggling in terms of advancing 
themselves. And clearly, the middle class and working families 
are struggling in terms of a tough economy but, frankly, we 
should be knocking down the last remaining barriers to people 
that they face in terms of racial discrimination, gender 
discrimination, age discrimination.
    That should be the focus of this subcommittee. So, again, 
we look forward to the witnesses' testimony. And, again, we 
hope, at some point, you know, we are gonna sort of realize 
that we are just sort of grinding our gears here with these 
types of hearings. And, hopefully, we can try and come up with 
a new model, if not in the lame duck session, with the next 
Congress so that we can, as a nation, take that 50th 
anniversary and celebrate it the right way--which is to advance 
equal treatment under the law under Title VII in the Civil 
Rights Act.
    I yield back.
    [The statement of Mr. Courtney follows:]

  Prepared Statement of Hon. Joe Courtney, Senior Democratic Member, 
                 Subcommittee on Workforce Protections

    Good morning. Thank you Mr. Chairman. And thank you to the 
witnesses for being here.
    This summer we celebrated the 50th anniversary of the 1964 Civil 
Rights Act, one of the most significant steps in the fight for equality 
in this nation's history.
    Title VII of this landmark law outlaws workplace discrimination on 
the basis of race, color, religion, sex, or national origin. These 
provisions help ensure that American workers are judged on the work 
they do - not on who they are, where they are from, or what they look 
like.
    Yet, even with all the progress we've made in the past 50 years, 
there is more work to be done as too many Americans suffer from 
discrimination by their employer even today. For example, just last 
year there were nearly 100,000 new charges of discrimination filed with 
the Equal Employment Opportunity Commission (EEOC)--including 1,019 
Equal Pay Act charges and over 67,000 Title VII charges.
    I was hopeful that when the subcommittee began to examine the work 
of the EEOC last year, we would look at ways to join together to 
strengthen our civil rights laws and build upon the critical 
improvements made through measures like the Americans with Disabilities 
Act Amendments and the Genetic Information Nondiscrimination Act.
    Instead, we are wasting valuable time with a set of misguided bills 
that impede the operations of the EEOC, and attempt to gut Title VII, 
turning back the clock on civil rights protections enacted more than 50 
years ago. These bills would decimate the EEOC's ability to safeguard 
American workers from discrimination, violate longstanding rules 
regarding attorney-client confidentiality, and do a great disservice to 
the nation.
    We should instead be finding opportunities to work together to 
bolster this nation's civil rights laws, focusing on legislation that 
combats prejudice and works to ensure that no person faces 
discrimination in the classroom or workplace because of their sexual 
orientation or gender identity. The Fair Employment Protection Act, 
Paycheck Fairness Act and Employment Non Discrimination Act would all 
help to strengthen our civil rights laws and should be the focus of 
this hearing.
    Thank you Mr. Chairman, and thanks again to our witnesses for your 
participation. I yield back the balance of my time.
                                 ______
                                 
    Chairman Walberg. I thank the gentleman, and I detect a 
disagreement between you and me on this issue. But on 
Constitution Day, we are doing our constitutional 
responsibility. We have not been given a vacation yet. And I 
think that it is good that we are here and it is good to have 
disagreements. And we hopefully can work to satisfactory 
conclusions. And that means we continually work.
    It is now my pleasure to introduce our panel of 
distinguished witnesses. First, Ms. Lynn Clements is director 
of regulatory affairs at Berkshire Associates of Columbia, 
Maryland. Prior to joining Berkshire Associates, she served in 
several positions at the Department of Labor and the Equal 
Employment Opportunity Commission, including as acting 
director, deputy director of the policy division for the Office 
of Federal Contract Compliance Programs. Welcome.
    Mr. William Lloyd serves as general counsel for Deloitte 
LLP in New York, New York. As general counsel, Mr. Lloyd is 
responsible for managing the organization's legal affairs, 
including governance, employment litigation, and regulatory 
matters. Thank you for being here.
    Mr. Michael Foreman is clinical professor of law and 
director of the Civil Rights Appellate Clinic at Penn State 
University's Dickinson School of Law in Carlisle, Pennsylvania. 
Mr. Foreman focuses on appellate representation in civil rights 
issues and employment discrimination. He has previously served 
as acting deputy general counsel for the U.S. Commission on 
Civil Rights. Welcome.
    Mr. Eric Dreiband is a partner at Jones Day law firm in 
Washington, D.C. From 2003 to 2005, he served as the general 
counsel of the Equal Employment Opportunity Commission. Prior 
to his EEOC service, Mr. Dreiband served as deputy 
administrator of the U.S. Department of Labor's Wage and Hour 
Division. Welcome.
    Thank you all for being here. Before I recognize each of 
you to provide your testimony, let me briefly explain our 
lighting system, which I think is familiar to you. If you have 
been on the highway, you have had red, green, and yellow 
lights. Green gives you your four minutes to speak, yellow 
gives a warning that a minute is left, and red we hope that you 
wrap up your remarks as quickly and concisely as possible. I 
will hold our Committee members to the same in asking questions 
of you, following your statements. Again, we will each be given 
five minutes to ask the questions of you, following your five 
minutes of testimony.
    And so now let me begin my recognizing Ms. Clements for 
your five minutes.
    Press the button on your microphone, please, there.

    STATEMENT OF MS. LYNN A. CLEMENTS, DIRECTOR, REGULATORY 
       AFFAIRS, BERKSHIRE ASSOCIATES, INC., COLUMBIA, MD

    Ms. Clements. Good morning, Mr. Chairman and members of the 
subcommittee. My name is Lynn Clements. I am the director of 
regulatory affairs at Berkshire Associates, a certified small 
business enterprise that helps other small businesses comply 
with their equal employment opportunity and affirmative action 
obligations. I very much appreciate the opportunity to share my 
perspectives with you today, and ask that my written testimony 
also be entered into the record.
    For almost half of my career, I served as a staff member at 
the EEOC and the Office of Federal Contract Compliance 
Programs, where I joined a dedicated group of career staff who 
tirelessly work to open the door of opportunity. I have a deep 
respect for my former colleagues, these agencies, and their 
mission. It is my experience that employers are similarly 
dedicated to creating fair and inclusive workplaces and to 
complying with the multitude of laws that they must follow. 
This is increasingly a difficult task.
    On an almost daily basis, I help employers answer real-life 
questions about their employment decisions and hiring 
practices. I have a better appreciation now for how difficult 
it is for an employer, especially a small employer, to 
understand and comply with the lengthy documents, policy 
documents, and rules that we publish as regulators. My 
experiences have shown me that an enforcement agency can only 
be truly effective when it is respected by the public it serves 
and regulates. A robust and thoughtful, deliberative process 
and neutral fact-finding are critical to earning that respect. 
Unfortunately, as an outsider now looking in, I believe that 
the EEOC has strayed from several of its original good 
government mandates.
    Increasingly, I have found that the agency does not always 
investigate or conciliate in good faith, even though such 
efforts are statutorily required. I have worked with employers 
both large and small who have endured individual charge 
investigations spanning several years; surprise notice of a 
charge by hand delivery, with a request for immediate access by 
an army of investigators, much like an FBI raid; requests for 
extensive information, immediately followed by a 
predetermination settlement offer that sends a very clear 
message pay up or endure a burdensome investigation; and 
findings of class discrimination without a class investigation.
    Most employers and, indeed, most employees are surprised to 
learn that the commissioners do not deliberate on the filing of 
most lawsuits. Understandably, the public expects that the full 
force of the federal government will only be brought to bear 
after careful deliberation.
    In the case of the EEOC, Congress determined that the 
deliberative process should be handled by a group of five 
officials with diverse backgrounds, experiences, and 
perspectives. When I was at the Commission, it generally filed 
about 400 lawsuits each year. Due to the delegation of 
authority to its general counsel, also presidentially 
appointed, the commissioners generally reviewed between 50 and 
75 of these litigation proposals.
    I understand, however, that the current Commission only 
reviews a handful of cases; as few as 15 in almost a recent 
three year period. In the business world, a similar delegation 
of authority would really be the equivalent of unveiling a new 
product without the CEO ever even knowing about it. Quite 
simply, placing the imprimatur of the whole Commission on a 
proposed legal theory garners a level of respect by the 
regulated community that is simply not possible when decisions 
are made by a single general counsel or regional attorney, no 
matter their skill.
    Perhaps most troubling is the impact on policymaking. Make 
no mistake about it, the agency is making policy when it 
decides to litigate. Thus, the process by which the EEOC 
arrives at those decisions is just as important as whether the 
agency ultimately prevails. The Commission's efforts in one 
particular area are instructive. In April of 2012, the 
Commission issued policy guidance regarding an employer's use 
of arrest and conviction records. Although this policy guidance 
was voted on, it was not subject to public comment. 
Unfortunately, the Commission failed to provide a clear path 
for employers, particularly those who must weigh the competing 
interests of the Commission's position and other state and 
local laws aimed at public safety.
    What this means is that those hard decisions will now be 
made through litigation by the Commission, some of which may 
never be reviewed by the Commissioners before it is voted on. 
Ensuring equal opportunity is an important federal goal. How 
this work is accomplished matters, and shining more sunlight on 
the agency will help it grow and succeed at its mission of 
ensuring equal employment opportunity.
    Thank you.
    [The statement of Ms. Clements follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
       
    Chairman Walberg. Thank you.
    Mr. Lloyd, we recognize your five minutes.

 STATEMENT OF MR. WILLIAM F. LLOYD, GENERAL COUNSEL, DELOITTE 
                       LLP, NEW YORK, NY

    Mr. Lloyd. Thank you. Chairman Walberg, Ranking Member 
Courtney, members of the Committee--
    Chairman Walberg. I am not sure your mic is on there.
    Mr. Lloyd. There we go. Sorry, I am a novice.
    Chairman Walberg, Ranking Member Courtney, members of the 
Committee, thank you for inviting me to testify today. I am 
Bill Lloyd, the general counsel of Deloitte LLP. I am grateful 
for the invitation to testify because today's hearing is 
focused on a number of bills that I believe would improve the 
processes within, and the accountability of, the EEOC.
    Deloitte is one of the world's largest professional 
services firms, providing audit, tax, and advisory services to 
individuals, businesses of all sizes, and to federal, state and 
local governments and community organizations. We have roughly 
65,000 people in Deloitte, and about 4 percent of those are the 
owners of the business: partners. I want to make it clear that 
Deloitte strongly supports the goals of eliminating workplace 
discrimination and fostering true equality of opportunity. We 
also strongly support the EEOC's mission and we appreciate the 
dedication of its staff. Deloitte is proud that we have 
consistently been recognized as a leader in inclusion and in 
developing highly successful women and minorities in our large 
firm.
    Although we are strong supporters of the EEOC's mission, 
our recent experience with the EEOC suggests that its processes 
and transparency could use some improvement. We need to ensure 
that the EEOC enforces its important mandate in ways that are 
consistent with what Congress contemplated in the respective 
statutes that the EEOC is tasked to enforce. And we need to 
ensure that important decisions about EEOC enforcement policy 
and allocation of scarce resources are made by the 
commissioners who are appointed by the President and confirmed 
by the Senate.
    The EEOC staff has recently challenged the fundamental 
structure of Deloitte's business, our decision to organize as a 
limited liability partnership. The staff has alleged that 
Deloitte is not a true partnership and, therefore our 
retirement policy for partners violates the Age Discrimination 
in Employment Act. The impact of the EEOC's legal theory raises 
significant economic and policy questions for Deloitte and all 
limited liability partnerships across the country, which will 
negatively impact many businesses. Congress did not grant 
jurisdiction to the EEOC to act on behalf of owners of 
businesses. Yet that is exactly what the EEOC is doing.
    Deloitte is a true partnership, and our partnership 
agreements and governance processes reflect that. State 
professional regulations require that we conduct our business 
as a partnership. Deloitte's partners voluntarily enter the 
partnership agreeing to retire at age 62, and each partner is 
highly compensated both during the period of partnership and 
after retirement. In fact, many partners choose to retire 
before age 62. Thus, the EEOC is seemingly advocating on behalf 
of this group of people in lieu of seeking out true victims of 
discrimination, the very people about whom Mr. Courtney spoke.
    For every case of questionable validity that the EEOC 
brings, it requires that the agency forego many worthy cases of 
discrimination on behalf of individuals who have fewer 
resources to pursue grievances and genuinely need the 
protection of regulators in the government.
    I am also concerned by the Commission's extensive 
delegation of authority to the general counsel to initiate 
litigation. I am not a labor attorney, and I was very surprised 
to learn that the commissioners do not review the overwhelming 
majority of cases filed by the EEOC. After all, Title VII 
permits only the five-member commission to bring a civil 
action.
    But my understanding is that, in practice, the general 
counsel determines whether any particular case is subject to 
review by the Commission. This practice, in my view, should 
concern all legislators and taxpayers. In the matter involving 
Deloitte, the EEOC has been conducting a directed investigation 
since 2010. We are concerned that if conciliation fails the 
general counsel will file a lawsuit under the delegation of 
authority without consideration and a vote of the 
commissioners, even though a similar matter involving a similar 
partnership came before the commissioners last year, and the 
commissioners elected not to file litigation.
    This is not only a matter of great public controversy but, 
given the powers and rights of Deloitte's partners, it is a 
novel interpretation of law that the Commission itself clearly 
should consider and approve before any litigation is commenced.
    We are not aware of any retired partner who has complained 
to the EEOC about age discrimination at Deloitte. And 
ironically, Deloitte's retiring partners are overwhelmingly 
white males, while newly-admitted partners over the past decade 
have been significantly more diverse. Eliminating the 
retirement age would ultimately limit the partnerships 
available to an increasingly diverse population of our 
employees.
    I thank the Committee for the opportunity to share our 
perspective, and I will be happy to answer any questions. Thank 
you.
    [The statement of Mr. Lloyd follows:]
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    Chairman Walberg. Thank you.
    Mr. Foreman, we will recognize you now for your five 
minutes.

  STATEMENT OF MR. MICHAEL L. FOREMAN, DIRECTOR, CIVIL RIGHTS 
  APPELLATE CLINIC, PENNSYLVANIA STATE UNIVERSITY, DICKINSON 
                SCHOOL OF LAW, STATE COLLEGE, PA

    Mr. Foreman. Thank you, Chairman Walberg, Ranking Member 
Courtney, and members of the Committee for the ability to 
testify on these pieces of legislation. I am sure there are 
good purposes behind them but, as my testimony reflects, they 
are premature, they are unnecessary. I think more importantly, 
they distort the function of what Title VII was passed to do 
and it will thwart any type of effective enforcement of the 
federal laws.
    Now, I know two of my colleagues that are testifying today, 
and they both worked at EEOC. And they know first-hand the 
ugliness of employment discrimination, and they know first-hand 
that you need to have an effective enforcement agency to fight 
that evil. They know that. We may not agree on much, but I 
think we will agree on that point. Now, Mr. Dreiband said it 
best. Notwithstanding EEOC's achievement, we have much work 
ahead of us. Unlawful discrimination anywhere remains a threat 
everywhere. Accordingly, we will continue to strive to obtain 
meaningful relief for victims of discrimination and achieve 
equality in the workplace.
    They are his words when he was general counsel of the EEOC, 
not mine. They were true then and they are true not--now. And 
these bills would strip EEOC's enforcement ability. For 
example, the Oversight Act would require a vote of 
commissioners, a disclosure publicly of that vote, and that 
vote would be posted within 30 days of starting of litigation. 
Now some may say, well, why is that a problem? Because much of 
that information is already available. Well, the reason it is a 
problem because that would create an affirmative defense for 
every employer in this country.
    What if EEOC does not post? What if someone challenges the 
vote? That is subject to discovery. That is not hysteria. That 
is exactly what is happening in the Mach Mining case. The 
employer community is arguing that is an affirmative defense. 
And what is the remedy? The remedy is the case gets dismissed 
and the innocent victims never see the light of day. And that 
is what is troubling about those type of bills.
    The Transparency Act would take resources--the limited 
resources--the EEOC has, and turn them into a data reporting 
and website management. There are so limited resources to fight 
employment discrimination, they should be directed toward 
fighting discrimination.
    As Congressman Courtney pointed out, there are obvious 
constitutional problems with exempting state and local 
governments from Title VII. I give the example, in my written 
materials, that it would basically overrule a case like Griggs 
v. Duke Power--as it applies to state and local governments. It 
is something we should not be doing at this time.
    These are basically a remedy in search of a problem. There 
is no pattern of EEOC abuse. If you look at the number of cases 
EEOC litigates, they are doing a wonderful job. Their 
enforcement record should be applauded and more enforcement 
agencies should work like they do.
    There are a few limited cases where they are sanctioned. 
And that shows that there is a process in place. EEOC is 
required to play by the same rules of all parties. And if they 
act improperly in a limited number of cases, rule 11 exists and 
there is a provision of Title VII that holds them accountable. 
And they can be sanctioned. So that shows the system works. We 
do not need to add another level of sanctions to EEOC thwarting 
their ability to do their effective job.
    And then finally, several of the, quote--``key parts'' of 
this legislation are before the courts now. Mach Mining has 
precisely the issue of what does the EEOC need to do in their 
conciliation efforts and what happens if they do not do it. 
That case has been briefed. My colleague, Mr. Dreiband, filed a 
brief this week in support of the business community. The court 
system has it, the Supreme Court will answer that question, and 
we will know what that means under Title VII. There should not 
be anticipatory legislation to deal with that.
    Similarly, there is litigation in Texas that was filed 
challenging EEOC's promulgation of the criminal enforcement 
guidance. Let the judicial system work, and there will be a 
determination of whether EEOC had that authority and what that 
means. Don't short-circuit the process. And I would just end, 
if I could, The Wall Street Journal, in their summary of sort 
of this issue, made the quote about EEOC, ``It is just not 
saber rattling anymore. The EEOC has shown that it means 
business.'' Isn't that the EEOC that Title VII expected? And 
isn't that the EEOC that every one of us wants--one that 
enforces the law? And these bills would hamper that ability.
    Thank you for your time, and I am available to take any 
questions.
    [The statement of Mr. Foreman follows:]
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    Chairman Walberg. Mr. Foreman, thank you.
    Mr. Dreiband, we recognize you for your five minutes.

    STATEMENT OF MR. ERIC S. DREIBAND, PARTNER, JONES DAY, 
                        WASHINGTON, D.C.

    Mr. Dreiband. Good morning, Chairman Walberg, Ranking 
Member Courtney, and members of the subcommittee. Thank you for 
inviting me to testify today. My name is Eric Dreiband, and I 
am a partner at the law firm of Jones Day here in Washington, 
D.C. Mr. Chairman, as you noted, I previously served as the 
general counsel of the United States Equal Employment 
Opportunity Commission. And in that role, I was privileged to 
work with Lynn Clements and many other talented and dedicated 
EEOC officials. It is with this background that I appear today 
at your invitation to speak about three bills that are pending 
before this subcommittee.
    First, I will start by discussing the Litigation Oversight 
Act of 2014. This bill would ensure that the EEOC cannot bring 
major or controversial litigation without a full up or down 
vote by a majority of the EEOC's five-member bipartisan 
Commission. Congress has vested the EEOC's attorneys with the 
authority to appear for, and represent, the Commission in any 
case in court, but to do so only at the direction of the 
Commission. As a result, the Commission has historically 
considered, deliberated about, and voted on whether to file 
lawsuits recommended by the Commission's general counsel.
    In recent years, however, the number and percentage of 
litigation matters presented to the commissioners has 
diminished significantly. According to one current EEOC 
commissioner, the Commission voted on three of 122 lawsuits 
filed during an entire year. These numbers give the impression 
of a commission made up of potted plants and disinterested 
bystanders.
    The available evidence suggests that the current strategy 
is not as effective as past practices. For example, the amount 
of money recovered by the EEOC's litigation program in the last 
two fiscal years is lower than at any point since the EEOC 
started reporting this data. Moreover, the EEOC has recently 
suffered several embarrassing losses. Several courts have 
dismissed all, or significant parts of, several EEOC lawsuits.
    Other courts have sanctioned the EEOC, and the taxpayers 
are on the hook for the cost of these cases and for paying 
sanctions. And these kinds of embarrassing losses and sanctions 
damage the commission's credibility. The Litigation Oversight 
Act may help restore the commission's oversight of the agency's 
litigation program.
    The second bill before this subcommittee, the EEOC 
Transparency and Accountability Act, would provide for judicial 
review of the EEOC's pre-suite conciliation efforts. The civil 
rights laws generally authorize the EEOC to file a lawsuit only 
after it has been unable to secure a pre-suit conciliation 
agreement from a potential defendant. In December of 2013, a 
U.S. court of appeals in Chicago became the first court to hold 
that EEOC's compliance with this congressionally-mandated 
obligation is subject to virtually no judicial review, and the 
Supreme Court is now considering the issue.
    The EEOC Transparency and Accountability Act would settle 
the issue by statute. The bill would require the EEOC to engage 
in bona fide conciliation, including by identifying its claims 
and any putative victims thereof before EEOC files a lawsuit. 
These provisions may preempt the sue first, ask questions later 
mentality that has troubled several federal judges and led to 
humiliating dismissals of several EEOC lawsuits.
    The third bill pending before this subcommittee is the 
Certainty in Enforcement Act of 2014. This bill would provide 
that an employer does not violate the Civil Rights Act if it 
complies with another federal, state or local law in particular 
areas.
    Some laws restrict employers from hiring persons with 
criminal convictions, and the EEOC recently issued enforcement 
guidance to suggest that such blanket hiring restrictions may 
violate the Civil Rights Act. The Certainty in Enforcement Act 
may provide a useful fix to this conflict in times--in many 
times, employers feel like they are caught between choosing to 
comply with one law and risk violating the Civil Rights Act.
    Nonetheless, for purposes of greater clarity, the 
subcommittee might consider a few amendments to the bill as it 
is presently drafted. First, you may consider limiting the 
bills to laws that require employers to conduct criminal 
background checks or credit history checks. This seems to be 
the primary concern of the bill.
    Second, you might also consider limiting the bill to allow 
employers to follow laws that are targeted to hiring practice 
in certain safety-sensitive areas like health care and child 
care, where people are serving very vulnerable individuals like 
children and the sick and injured. Third, adding the language 
that specifically addresses disparate impact liability--that 
is, so-called unintended discrimination--may help clarify that 
the Certainty in Enforcement Act is in no way intended to 
sanction intentional discrimination.
    Thank you for the opportunity to testify here today, and I 
look forward to your questions.
    [The statement of Mr. Dreiband follows:]
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    Chairman Walberg. Thank you, and thanks to each of the 
witnesses for your statements. And we look forward to those 
being broadened under questioning. Before I move to recognize 
my colleagues for questions, pursuant to Committee rule 7(c), 
all members will be permitted to submit written statements to 
be included in the permanent hearing record. And without 
objection, the hearing record will remain open for 14 days to 
allow such statements and other extraneous material referenced 
during the hearing to be submitted for the official hearing 
record.
    I would also like to ask for unanimous consent to include 
in the record a letter of support signed by 19 stakeholders for 
all three bills we are discussing today, including professional 
organizations, health care organizes, construction, food 
service, you name it.
    [The information follows:]
    [Additional submission by Chairman Walberg follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
        
    Chairman Walberg. So without objection, hearing none, they 
will be included in the record.
    I will now recognize the Chairman of the full Committee, 
Education and Workforce, the gentleman from Minnesota, Chairman 
Kline.
    Mr. Kline. Thank you, Mr. Chairman. Thanks very much to the 
witnesses for being here today for your testimony.
    Ms. Clements, let me start with you because I want to get 
at this issue of preemption, federal law, state law, and all 
that sort of thing that was raised by the Ranking Member and 
others. The EEOC's criminal background checks guidance states 
that the fact a criminal background check was conducted in 
compliance with a state or local jurisdiction requirement does 
not shield the employer from liability. That is your testimony, 
and what we are talking about here. And yet there are numerous 
federal, state, and local laws requiring the use of criminal 
background checks.
    For example, the Senate passed in March, and the House 
passed this week, the Child Care and Development Block Grant 
Act, which requires states to have policies and practices in 
place requiring background checks for child care providers and 
prohibiting employment in federally-funded child care programs 
of those convicted of violent or sexual crimes. So in this 
case, we passed, and we hope the President will sign and all 
that, a law that requires states to have such practices and 
policies in place. So how is a child care provider, or another 
small business, supposed to choose between following state law 
and subjecting itself to EEOC prosecution?
    It just seems like that is really between a rock and a hard 
place. I want to give you the opportunity to expand on that for 
just a minute.
    Ms. Clements. I absolutely agree with you. It is those 
types of examples that really illustrate the difficult position 
that the EEOC's enforcement guidance put employers in. It is a 
Hobson's choice, with no good answer at this point. And really, 
I would ask what exactly is an employer supposed to do if they 
conduct the individualized assessment that is contemplated by 
the EEOC's guidance and determine that the state or local 
requirement is not job-related? They still have to follow it. 
And if the EEOC's answer is that this will never happen, that 
these types of requirements will always be job-related, then 
they should have said so in the guidance so that employers 
could avoid--especially small employers--could avoid this 
costly individualized assessment.
    I don't think these difficult decisions should be made on 
the backs of private employers. They are simply trying to 
follow the law. They don't make the law.
    Mr. Kline. Thank you.
    Mr. Lloyd, according to your testimony, in its reasonable 
cause determination the EEOC demanded elimination of the 
retirement provision, extension of offers to reinstate retired 
partners, and the creation of a compensation fund for those 
retirees forced to retire early. Could--we just probably have a 
couple of minutes here on the clock. Could you sort of briefly 
describe Deloitte's business model and what the effect of this 
would be on that? And just--I am very concerned when you get 
something like the EEOC dictating what your business model 
should be. But explain why this is a problem.
    Mr. Lloyd. Thank you, Chairman Kline. It is a big problem 
for us. As I said, we have an ownership structure, partners who 
are about 4 percent of our total population. And I could go 
into great detail about why they are real partners. And we are 
required to have that model. Not necessarily 4 percent, but to 
be a partnership under various state regulations relating to 
certified public accountants and the way they can organize. 
Beyond that, the retirement system we have in place helps 
ensure that we have appropriate succession planning, that we 
can plan for the future. Because under many statutes, such as 
Sarbanes-Oxley in the audit practice for example, we have to 
rotate people into the positions of leading the audits for 
independence purposes.
    And thus, it is very important to us that we have virtual 
certainty about how long people can serve in the role as 
partner, these leadership positions of all sorts within the 
firm, and plan so that we have orderly transitions and we groom 
people to move into those positions to comply with the 
regulations that we are subject to.
    Mr. Kline. Okay, I am about to run out of time here, Mr. 
Chairman.
    I will yield back. Thank you.
    Chairman Walberg. I thank the gentleman, and I recognize 
the Ranking Member of this Committee, the gentleman from 
Connecticut, Mr. Courtney.
    Mr. Courtney. Thank you, Mr. Chairman.
    Mr. Foreman, just to sort of focus for a second on the 
background check guidance activity by the Commission. Again, 
just for the record--and I am pretty sure you have followed 
this pretty closely--but the Commission, as a whole, did 
actually act on this. This was not something, again, that 
delegated staff created in terms of that guidance. Isn't that 
correct?
    Mr. Foreman. Yes, that is correct.
    Mr. Courtney. Yes, and it was a bipartisan vote of the 
Commission. And again, it was trying to get at what is a real-
life impact out there, which is that criminal background checks 
if not used, you know, sensibly, can have the net effect of 
harming or excluding people from employment who--particularly 
the African-American and Latinos. And, again, that is something 
that the Commission studied before it moved forward. Isn't that 
correct?
    Mr. Foreman. Yes, absolutely. The data on that point is not 
in dispute that if you implement either arrest records or 
criminal background histories, and screen based upon that, you 
are going to screen out statistically significant parts of 
minority populations. I mean, the data is uncontroverble on 
that.
    Mr. Courtney. But it also made clear that employers are not 
required to just ignore it entirely. I mean, there was clear 
latitude that, you know, that sort of guidance allows for 
common sense decision-making by employers. So that the nature 
and gravity of prior criminal conduct, the time that has 
elapsed, the nature of the job, and how--I mean, it all 
provides safe harbor for employers who--you know, again, if 
they have got somebody they know is a violent offender that 
they should not be in a, you know, child care center or a 
health care facility or, frankly, almost any employment 
setting.
    I mean, isn't that correct? I mean, they recognize common 
sense opportunities for employers not to be helpless with 
information they know about individuals.
    Mr. Foreman. And absolutely in the guidance did not plow 
any new ground. I mean, if I could just take a moment, it 
actually started based upon a case called Green v. Missouri 
Railroad, where they said you can take these into 
consideration, but there needs to be an individual 
determination. Does this really impact the persons to do the 
job? EEOC then issued guidance that was approved by, then--now 
associate justice Clarence Thomas, saying yes, that makes 
perfect sense. The case went to the Third Circuit, El v. Septa. 
And the Third Circuit said we would like more guidance from 
EEOC on this so that we could actually defer.
    And then EEOC does hearings and develops very detailed 
guidance, but has its foundation in Green and what Associate 
Justice Clarence Thomas said was good policy, and is simply out 
there now so that employers know what the rules are.
    Mr. Courtney. So, again, all I would just say is that, you 
know, if there are issues that, you know, you feel are still a 
problem out there, Ms. Clemens--I mean, frankly, you know, that 
is something that I think that all of us up here are more than 
happy to present to the Commission and support in terms of them 
to reexamine or reevaluate how it is being implemented. But 
5423 is a blunt instrument which even Mr. Dreiband's testimony 
acknowledged, you know, kind of sets in motion a mechanism 
which sweeps up a much more damaging path as far as the--what 
it could do to individuals, who have nothing to do with the 
issue of criminal background checks.
    My few remaining seconds here. Mr. Foreman, can you talk 
about the claim of litigation crisis again in terms of what the 
real numbers are out there? I mean, we heard sue first, ask 
questions later. I mean, again, what I am seeing is really 
almost the opposite in terms of how much actually goes to 
court.
    Mr. Foreman. Well, again, the data is out there that EEOC 
has done a tremendous job in recouping damages and filing all 
suits. There are several cases that repeatedly get played back 
as EEOC gone awry. And one thing I think this Committee really 
needs to understand, if you talk about Kaplan, if you talk 
about People Mart, I think Crist is one of those also. That all 
of these bills would not have changed the outcome in those 
cases at all. Why do I say that? Because Kaplan and Peoplemark 
were approved by the commissioners. So it went through the 
process and they approved that litigation.
    And in Crist, I think also went through the system, but I 
am not 100 percent sure on that. And as the conciliation 
failure, EEOC's position is they engaged in good faith 
reasonable negotiation and so it would not have changed the 
outcome at all. But what it would do is provide another layer 
of litigation and another cost, and prevent innocent victims of 
discrimination from ever getting in the court if there is some 
procedural dismissal on the case.
    Thank you.
    Chairman Walberg. I thank the gentleman. I recognize myself 
now for my five minutes of questioning.
    Mr. Dreiband, thank you for your comments. Thank you for 
your suggestions, as well. That is what a subcommittee process 
is for. And our full Committee chair will appreciate us doing 
deliberative work here. But early this year I met with General 
Counsel Lopez, and followed up with a request for documents 
regarding EEOC's litigation policies. I had EEOC provide me 
with all the class action and systemic complaints filed between 
2009 and 2014. In that, I discovered that only 8 percent of 
these cases were pursued through Commission approval.
    Can you explain to the Committee how a Commission that has 
designed to implement the nondiscrimination policies of EEOC is 
barely involved in multiple plaintiff litigation?
    Mr. Dreiband. Well, it has certainly been a change since my 
time at the Commission. I think that the current approach has 
essentially been to delegate, in practice and in fact, nearly 
all authority to the general counsel to make a decision about 
whether or not to go forward with a lawsuit. That is not how 
the Commission operated when I served at EEOC. As Ms. Clements 
noted, I sent dozens if not hundreds of cases to the Commission 
for a vote. And I found that by doing that, it enabled us to 
speak with one voice, to send a message to actual or putative 
defendants, that the Commission's litigation was backed by the 
full Commission. And I think the results speak for themselves.
    I am flattered that Mr. Foreman saw fit to quote my remarks 
at one time when I served as general counsel. But when I 
served, with full support of the Commission, we recovered more 
money for victims of discrimination through our litigation 
program than ever in the history of the EEOC. And what we have 
seen in the last couple of fiscal years is that both filings 
are down, as well as recovery through the litigation program, 
and down significantly to the lowest levels since the 
Commission started reporting this data.
    So, you know, the Commission is currently free to operate 
how it wants to. The bills would require more involvement by 
the Commission. And I suppose my question would be, for anybody 
who opposes more Commission oversight in deliberation about 
Commission litigation recommendations exactly what they think 
these commissioners should do. I mean, the chair of the 
Commission has the operational authority of the EEOC by 
statute, but the other four commissioners have no operational 
authority at all. They don't supervise investigations, they 
don't direct litigation. All they do is vote on policy matters 
presented to them by the chair on litigation matters presented 
by the general counsel or, on occasion, subpoena enforcement 
actions. And that is it.
    Chairman Walberg. So, would you think that this potential--
this policy, as it is being carried out right now--speaking as 
a former general counsel, creates the possibility of abuse of 
power by the general counsel in this whole process?
    Mr. Dreiband. Well, I think that the current general 
counsel is a friend and former colleague of mine. And I think 
he is well-intentioned and doing the best job he can do. I 
don't--but I don't think, though, that having oversight by the 
commissioners does anything other than strengthen the 
litigation program by the Commission. It sends a message to the 
public, to potential defendants, that the Commission stands 
behind the decision to commit resources and to file the 
lawsuit. And simply creates a review of potential litigation, 
including some of these embarrassing losses that the Commission 
has suffered lately that may or may not have occurred, of 
course, as Mr. Foreman pointed out.
    But in the same way that the grand jury reviews an 
indictment presented by the prosecutor, the Commission has 
served that function very well, certainly during my tenure and 
at various other times in the history of the agency.
    Chairman Walberg. Thank you. Let me move over.
    Mr. Lloyd, recently EEOC investigated 
PriceWaterhouseCoopers for including a mandatory retirement age 
in its partnership agreements, sounding familiar to your 
situation. The EEOC general counsel submitted that case to the 
Commission, but the Commission by a three-to-two vote did not 
approve litigation. Why is EEOC investigating Deloitte for the 
same type of partnership agreement that PriceWaterhouseCoopers 
has, when the Commission already decided the issue did not 
merit litigation?
    Mr. Lloyd. Mr. Chairman, I have to say I have no idea. I am 
sorry that I can't answer that question.
    Chairman Walberg. I figured that would be your first 
response. But are legal issues any different in the two cases?
    Mr. Lloyd. No, the legal issues are no different. If 
anything, our partnership agreement provides for more 
participation by partners than PriceWaterhouse's does. But 
essentially, we are in the same business, we have the same 
business model, we have the same partnership structure 
generally. Our age is 62 for mandatory retirement, their age is 
60. So in that sense, there is a slight difference. But we have 
not been given, thus far, any notification of the basis of the 
staff's determination that we violate the Age Discrimination 
Act other than they believe any mandatory retirement policy 
based on age is inappropriate.
    Chairman Walberg. So then do you believe the Commission's 
rejection of the PriceWaterhouseCoopers case set a precedent 
the agency should follow unless it provides a compelling 
explanation of why it is abruptly reversing course?
    Mr. Lloyd. I do believe that, yes, sir.
    Chairman Walberg. And that is the challenge that you have, 
then, in dealing with something that is now seemingly a 
precedent-setter. But going over what they have already said.
    Mr. Lloyd. It is. And, you know, one thing that we very 
much would like is an opportunity to discuss with the 
commissioners themselves the reasons why they did not elect to 
proceed against PriceWaterhouse and the reasons why they should 
not elect to proceed against Deloitte.
    Chairman Walberg. Okay, thank you. My time is up.
    I now represent--I now ask the representative--where has he 
gone? Oh, there he is, right here. Representative Takano, who 
has stepped into the Ranking Member's position here, for your 
five minutes of questioning.
    Mr. Takano. Thank you, Mr. Chairman.
    Mr. Foreman, could you comment on this colloquy on the role 
of the Commission and Deloitte's interest in having it's 
interests reviewed by the entire Commission? And maybe just 
comment on what you think the role of the Commission ought to 
be.
    Mr. Foreman. Yes. And I will give my disclaimer that I am 
not an expert on the facts of the specific case. But what I 
think this represents, and what we have heard today, is that 
everybody supports the discrimination laws except when they are 
aimed at their client. And then they come before you and say it 
is not fair that we are being targeted. And why do I say that? 
And Chairman Walberg, you used the term ``precedent-setting.'' 
Here is the reason I say that. That case is based on a 
precedent that was set by EEOC years ago, where they sued a law 
firm--Sidley & Austin--arguing that their partners were 
employees.
    That was litigated--a litigation that was approved and 
brought by my colleague, General Counsel--then-General Counsel 
Dreiband, and approved by the Commission. So they had a policy 
of doing exactly what they are doing with PriceWaterhouse. So 
there is not some change of the rules. They are taking existing 
precedent and challenging it. And at some point, the courts and 
the Supreme Court will say are these individuals employees for 
purposes of coverage, or are these employees partners?
    Mr. Takano. Well, I want to shift topics a little bit. The 
majority seems to be using the EEOC's recent guidance on 
background checks as justification for acting on H.R. 5423. It 
is my understanding that the EEOC guidance allowed for 
flexibility based on the nature of the employment. I know that 
we had some of this discussion with Mr. Courtney, but can you 
elaborate on that? The scope of H.R. 5423 seems to go well 
beyond the issue of background checks. What kinds of 
repercussions could a bill of this breadth have on the EEOC?
    Mr. Foreman. Again, and it was talked about earlier, if you 
apply that bill as written it applies to intentional 
discrimination, disparate impact discrimination. A state or 
local government could pass a law that says women could not do 
X. It would be exempted by--under that bill. Now, there is a 
recognition that maybe it should be limited to criminal history 
backgrounds, but even that presents a problem because you are 
elevating local and state law over federal law. Title VII was 
written to do exactly the opposite.
    Mr. Takano. So as you covered in some of your testimony, I 
am still curious about 5423, some of the problems it would 
cause. In your opinion, if we went back to the quote, unquote--
``states rights schema'' to root out discrimination in the job, 
what are some of the challenges that workers would face? And 
you named a lot of them just now.
    I am just curious. Mr. Lloyd, given Deloitte Touche's 
commitment to the mission of the Commission, is H.R. 5423 
something that you could support, knowing what you know now?
    Mr. Lloyd. Sir, I think that we support all the bills that 
are proposed. I think some of them could be improved, as Mr. 
Dreiband suggested. But there are--there is guidance issued by 
the EEOC that is problematic in practice. And we think that 
things can be improved. The processes and guidance from the 
EEOC can be improved, sir.
    Mr. Takano. One last question. H.R. 4959 would mandate, 
quote--``good faith efforts to endeavor'' to resolve charges 
by, quote--``bona fide conciliation.'' In doing so, it would at 
least, in part, deal with issues set forth by the Seventh 
Circuit in EEOC v. Mach Mining, which is pending before the 
Supreme Court. Should Congress be getting involved in this 
issue? I think you already answered that, Mr. Foreman.
    Mr. Foreman. My view is absolutely not. That we have a 
Supreme Court, we have exactly that issue there. The business 
community is making their arguments. The United States 
government will be making their arguments. And probably by June 
we will have a decision on what that conciliation provision 
means in Title VII. Why change it now?
    Mr. Takano. And what exactly do good faith and bona fide 
mean, as used in this legislation?
    Mr. Foreman. Well, that is part of the underlying 
litigation. Why the Seventh Circuit said that you cannot 
utilize that as an affirmative defense. Because, one, EEOC has 
absolute discretion as to whether it fulfills--the settlement 
fulfills the duty of Title VII. So is one more offer required, 
is one more dollar required? And if EEOC says no, we are gonna 
fail conciliation, is that bad faith conciliation? And the 
court says you cannot adopt a workable standard, and that is 
the reason we can't make an affirmative defense as this bill 
would attempt to do and as the employers are arguing in Mach 
Mining.
    Mr. Takano. All right, thank you, sir.
    My time has run out.
    Chairman Walberg. I thank the gentleman.
    I now recognize my colleague from Indiana, Mr. Rokita.
    Mr. Rokita. I thank the chair, and I thank the witnesses 
for their testimony. I always learn a lot at these hearings, 
and I think that is what they are about. And perhaps unlike 
some others that were here earlier, I try not to prejudge them. 
But having said that, I do want to start off by offering some 
time to Mr. Lloyd. In Indiana, we have a saying that it is a 
pretty thin pancake that don't have two sides. And I think the 
actual quote is ``don't'' instead of ``doesn't.'' But if you 
had anything else to add to the recent comments of Mr. Foreman, 
you are welcome to say them now, for a couple seconds.
    Mr. Lloyd. Thank you. I actually know the facts of the 
Sidley matter better than Mr. Foreman because I was partner at 
Sidley & Austin and on the executive committee at the time the 
EEOC brought that litigation. And I think Mr. Dreiband made an 
error in suing Sidley. But in any event, I can tell you that on 
the one hand we have the Sidley matter--where the Commission 
approved, going forward, and I understand why. And we have the 
PWC matter, where based on very different facts the Commission 
made the decision not to go forward. And our facts are very 
similar to the PWC situation, and very dissimilar from the 
Sidley situation.
    And I would like the opportunity, as I would have, for 
example, at the SEC if the staff made a recommendation to 
proceed, to submit, in one form or another--and maybe even 
visit with--to the commissioners the facts so that they can 
make an informed decision about whether it makes sense as a 
policy matter, as a matter of whether this is a novel issue of 
law, and as a resource allocation matter. I mean, who are we 
going to protect here by initiating this litigation and tying 
up our staff time on this? And I can tell you, we take votes. 
Sidley partners did not vote, for example. That is a very 
important difference.
    And my guess is that if at Sidley we would have had votes 
taken by the partners on a routine basis for such things as 
electing leadership that the EEOC, at the time, would have made 
a different decision and would not have authorized proceeding 
against Sidley.
    Mr. Rokita. Thank you, Mr. Lloyd.
    Mr. Lloyd. Thank you.
    Mr. Rokita. And this is to you and Mr. Dreiband. In my 
prior public service, I was Indiana secretary of state. In that 
great job, I had the opportunity to oversee several boards, 
appoint several boards, create into statute boards. Some 
boards, you know, were politically divided equally: two 
Republicans, two Democrats. That usually ended in a disaster. 
But some were all my appointments, as a person being directly 
elected by the people. And then some had different varied 
degrees of political appointments. But they weren't necessarily 
partisan. It was just a way to decide things and to reflect the 
will of the people through their elected representatives.
    It seems to me, in hearing this discussion, that if you are 
having unelected attorneys, bureaucrats-- whatever word you 
want to use-- make these decisions, you are kind of tipping the 
scale of what the statute might have intended and the 
legislature might have intended in terms of the political 
appointments and how these decisions were supposed to be, 
really, made. Can you comment on that briefly, Mr. Lloyd? And 
then Mr. Dreiband, same question?
    Mr. Lloyd. Yes, I would be happy to respond. I agree 
wholeheartedly. And it has nothing to do with the competence of 
the attorney or the good faith of the attorney. Speaking as a 
general counsel myself, you know, I many times have oversight 
that sometimes I wish I didn't have. But I have found that, 
over time, that oversight and getting differing opinions from 
people who are experienced and have different insight--come 
from different backgrounds, have different points of view--is 
extremely valuable. I learn things, I then make different 
decisions on occasion from what I would normally do.
    Mr. Rokita. And then Mr. Dreiband, in the time I have 
remaining. Thank you, Mr. Lloyd.
    Mr. Dreiband. Sure. Any law enforcement agency, no matter 
who they are, can become prone to overzealousness and excess. 
That is true of prosecutors, that is true of police 
departments. And, at times, it is true even of the EEOC. To 
deal with this issue, Congress created the Commission; a 
bipartisan Commission of five people, appointed by the 
President, confirmed by the United States Senate, to serve 
staggered five year terms. No more than three of those five 
members can be of the same political party. As a result, the 
Commission, in the statute itself, is responsible for 
authorizing attorneys appointed by Title VII of the Civil 
Rights Act to appear in court at the direction of the 
Commission.
    Congress did not intend, and there is nothing in the--any 
statute to suggest that Congress did intend, for the Commission 
to delegate all of its authority about litigation entirely to 
other people in the agency. And that appears, in practice, to 
what has happened at the EEOC. In the same way as I said 
earlier that grand juries provide a check on prosecutors, even 
the most well intentioned prosecutors, the Commission can 
serve, and has historically served, that same function at the 
EEOC.
    Mr. Rokita. Thank you, Mr. Dreiband.
    Seeing my time has expired, Mr. Chairman, I am yielding 
back. But I also would like to note for the record that the 
Ranking Member indicated that the hearing was only noticed for 
eight days. That is actually a day long--extra day than what 
the rules actually require. And I would hope that the Ranking 
Member, with 25 years of law practice, would have read our 
rules.
    Chairman Walberg. I appreciate the former secretary of 
state's attention to detail. And yes, it was eight days, while 
we were only required seven days.
    I now have pleasure of recognizing the gentleman from 
Virginia, Representative Scott.
    Mr. Scott. Thank you, Mr. Chairman.
    Mr. Foreman, we have talked about the background checks. 
The case I remember from--was the Griggs case, where they 
required high school diplomas, which had nothing to do with 
your ability to do the job. And it had a disparate impact in 
the community without having any relationship to the jobs. Now, 
this background check thing comes into practice with what is 
called that box you have to check. And there is a campaign to 
ban the box because when you check the box your application 
summarily goes into the trash.
    Now, we have heard of situations where you--it would be 
illegal to hire people who have been convicted of violent 
crimes or sexual--or people who have--sexual abuse. Would it be 
improper to have a box on the application that states violent 
crime or sexual abuse as opposed to a box that generally any 
felony or any arrest or anything else that would be generally 
applicable? It seems to me that the general box, any felony, 
would be over-broad and would include a lot of people that 
would not be prohibited from being employed. And you would have 
the--you are back to the disparate impact without any job 
relation. Is that true, Mr. Foreman?
    Mr. Foreman. I mean, that would be one way to attempt to 
address it. I mean, you are absolutely right on banning the 
box. I mean, what happens is, many employers will adopt a 
policy that says have you ever been arrested or convicted of a 
crime. If the answer is yes, you are out of the screening 
process and there is no individualized assessment. And part of 
what EEOC's guidance is trying to do is say let's look at the 
person. Is this person rehabilitated? Is it proper--can this 
person do the job? Is it reasonably related to the job? That is 
really all the guidance is trying to do.
    In going back, as you said, to Griggs v. Duke Power, that 
was a GED that screened out minority employees. And the court 
there found that it was discriminatory, developed a disparate 
impact analysis, and we discovered there are other things that 
do that. And that is what the criminal guidance is supposed to 
do. The problem with the proposed bill, then, it then takes and 
exempts state and local governments from basically the 
requirements of Title VII. When it was passed, that was vital 
to Title VII. So let's not understate what the proposed bills 
are doing. You are rewriting one of the most historic civil 
rights statutes of our history in a way that doesn't add any 
benefit.
    Mr. Scott. Mr. Foreman, can you state the present law on 
discrimination cases as they relate to sex discrimination, what 
you can recover, as opposed to other forms of discrimination--
race, religion, national origin? Are there differences in what 
you can recover?
    Mr. Foreman. Well, they are absolutely different in terms 
of what EEOC can recover as opposed to an individual who may 
bring a claim under--and I don't want to get bogged down in 
terminology, but 42-USC-Section 1981 there are uncapped 
damages. You--the jury will award whatever the damages are that 
were the cause of the discrimination. Whereas under Title VII, 
they are capped according to the size of the employer.
    Mr. Scott. Well, is it different in Title VII from other 
forms of race discrimination? They are uncapped under 1981, but 
not uncapped in others?
    Mr. Foreman. Well, 1981 only applies to race 
discrimination-based claims. So if you bring a race-based claim 
under Title VII in an employment context you are capped. But 
you are also capped in sex discrimination, any of the protected 
coverages under Title VII. Did that answer your question?
    Mr. Scott. I think--yes. Well, does the--we have the Fair 
Pay Act for sex discrimination cases. Can you say what they 
would do to improve the situation, the Equal Pay Act?
    Mr. Foreman. Well, the Equal Pay Act has a different 
regimen that does not have the same level of damages. I mean, 
the reality is that the discrimination law should provide 
whatever damages the person suffered, whether it is sex-based 
discrimination, race-based discrimination. And I think the Fair 
Pay Act is attempting to get at that to say if you are--if you 
prove that you are a victim of intentional discrimination, then 
you should be entitled to whatever economic damages that 
discrimination caused you.
    Chairman Walberg. The gentleman's time has expired. Thank 
you.
    And now I recognize the sponsor of H.R. 4959, my colleague 
from North Carolina, Mr. Hudson.
    Mr. Hudson. Thank you, Mr. Chairman.
    Mr. Lloyd, I have read your testimony and I have to tell 
you I am really deeply concerned that at a time when--with 
limited resources EEOC has, what, some 77,000 pending claims 
they are looking at, that they have just--that they have made a 
decision to go after your firm and the mandatory retirement 
age, when no one has filed any sort of complaint or there have 
been damages. This is a decision made by a group of partners 
who manage this firm. And the irony of it is, if the firm 
decided to comply with the lawyers at the EEOC's request it 
would require a vote of the partners to make the change. 
Frankly, it is outrageous to me.
    But my question to you is, do you believe that if the EEOC 
continues to pursue this line, this matter, that it would 
involve a major expenditure of resources by the EEOC and/or 
trigger the public controversy test requiring a vote of the 
Commission?
    Mr. Lloyd. Well, I strongly believe that it would meet 
those tests, as well as the tests that this would be a novel 
application of the law for reasons we discussed. It would 
require extensive expenditure of resources by the EEOC. Not 
court costs and things like that. But when you think of 
valuable staff time, this would be major litigation. We would 
defend ourselves vigorously because we think they are wrong as 
a matter of law and as a matter of fact. And so the EEOC staff 
devoted to that litigation would be fairly extensive. And those 
people would not be able to pursue those 100,000 claims, or 
charges, that they get of individuals who need real protection.
    I mean, we are talking about, at Deloitte, people who are 
real partners but, beyond that, very highly compensated. And we 
have done a study in response to this that shows that our 
partners who have retired, been required to retire in the last 
five years, have been overwhelmingly--as I said in my 
testimony--white males. And yet our population coming along 
through the staff and eligible to be admitted to the 
partnership is much more diverse. And over the last five years, 
while our white males have been retiring, 88 percent of our 
retiring partners have been white males over that last five 
years and only 12 percent women and minorities.
    On the other hand, the newly-admitted partners during that 
same period of time have been 41 percent women and minorities 
and 59 percent white males. And so the operation of the 
mandatory retirement system has actually caused our partnership 
to become more diverse, and it clearly will in the future.
    Our population of people below the partner level is 
incredibly diverse, and they are wonderful performers and they 
are going to advance to partnership. But if we were not able to 
have this mandatory retirement provision that we do have, age 
62, then--we have a limited number of partnerships--and so the 
opportunities for the women and minorities would be limited. 
Not foreclosed, but they would be limited. And, to me, that is 
a perverse result when you think of all of the objectives of 
the statutes that the EEOC is tasked to enforce, and objectives 
that we believe in quite strongly. I mean, we do our own 
internal disparate impact analyses, and we make sure that we 
are doing the best job we possibly can to provide equal 
opportunities and development opportunities for our women and 
minorities. And this would hinder that.
    Mr. Hudson. I appreciate that. And, Mr. Chairman, I do 
believe the cost involved, as well as the public controversy 
test certainly comes in play here. And I would hope that the 
EEOC, if they choose to pursue this, will move to a vote of the 
Commission. Because I think that is what the statute requires.
    Changing direction here quickly, Mr. Dreiband, my bill, 
H.R. 4959, has a provision clarifying the EEOC's conciliation 
efforts must be in good faith and are subject to judicial 
review. Professor Foreman's testimony criticizes this provision 
as undermining the separation of powers because the Supreme 
Court has granted review on this very issue in the EEOC v. Mach 
Mining. Do you believe it is appropriate for Congress to 
clarify what the duty of the conciliation entails?
    Mr. Dreiband. Well, I don't see anything wrong with 
Congress clarifying the matter if Congress decides to do that. 
Congress is an independent branch of the United States 
government, and it is not in any way limited by the fact that a 
lawsuit is pending before any particular court, including the 
Supreme Court of the United States.
    Mr. Hudson. Appreciate that. Trying to use my time as 
efficiently as I can.
    Ms. Clements, thank you for you testimony. I have read 
that, as well. You described instances of what could be 
characterized as abusive investigatory tactics at EEOC. You 
also described situations where EEOC would make a 
predetermination settlement demand, and when the employer 
declined the EEOC would quickly drop some of the charges. The 
EEOC Transparency and Accountability Act, which I have 
introduced, clarifies the EEOC must conciliate in good faith 
and provide specific information to the employer about the 
factual basis of the allegations and the effect on employees, 
and the EEOC's conciliation efforts are subject to court 
review. How would these provisions alleviate the problems you 
have seen at EEOC investigations and mandatory conciliations?
    Chairman Walberg. Seeing that time has expired, and yet 
being a sponsor of the piece of legislation I will ask you to 
respond as quickly as possible, and the rest could be put in 
writing.
    Ms. Clements. I think it is important for the Committee and 
the EEOC to recognize that employers, when faced with 
appropriate information from the Commission, are more than 
willing to come to the table and try to fix problems that the 
Commission sees. What is happening now is that employers don't 
have enough information to really evaluate the strength of the 
EEOC's findings. And it makes it difficult for employers to 
pursue negotiations in good faith. And so one of the things 
that I think your bill would help is provide that information 
so that both parties can come to the table in good faith with 
the same information about the employment practices that are at 
issue.
    Mr. Hudson. Great. I thank the Chairman for his magnanimity 
and discretion there. Thank you.
    Chairman Walberg. How is that defined in North Carolina? I 
am not sure about Michigan either, so thank you. I thank the 
gentleman. And thanks to the panel. We appreciate your very 
considered testimony, answers to question, ideas. And that, 
again, is the purpose of this subcommittee.
    And now I would ask my Ranking Member to conclude with his 
concluding remarks.
    Mr. Courtney. Thank you, Mr. Chairman. Again, thank you to 
all the witnesses for the time you devoted here this morning. 
Again, I understand that while I was over at the Agriculture 
Committee someone raised a question about whether or not I was 
challenging whether the Committee had followed the rules. That 
was not my point earlier. There is no question seven days is 
the rule. The issue, really, is that this is, I think, our 
third hearing or possibly our fourth hearing on EEOC over the 
last two years or so. Once the chair was the witness, but since 
then the scheduling of the hearing process has basically 
effectively excluded the Commission from participating in a--in 
what I think would be a helpful dialogue in terms of trying to 
express frustrations that members may have, constituents may 
have.
    Because in my opinion, you know, a legislative response, 
which is really, you know, what is on the agenda here today--is 
a fool's errand. I mean, the chances of any of these bills 
getting enacted in the 113th Congress are about as remote as 
the Red Sox getting into the playoffs. And if any of you follow 
the standings, they have been mathematically eliminated. So 
that is impossible. And so, you know, we have this exercise for 
whatever purpose. And, again, it is gonna accomplish nothing in 
terms of changing the law. And what I think would be a better 
use of time would be to actually engage with the Commission and 
the department.
    We have tangible results in the last nine months since 
Secretary Perez has taken over, where he has listened to 
bipartisan concerns that members have raised with the 
department in terms of department operations. And he has 
responded to those with real tangible results.
    And, again, I think, you know, having legislation which was 
just filed, you know, in certainly the last case, you know, 
within just a week ago, and expect that to somehow advance the 
ball here in terms of, you know, really trying to improve the 
agency's performance, again I just think is--with the 
productivity of this Congress in terms of the amount of 
legislation that has actually been enacted, you know, just not, 
in my opinion, the most effective use of time.
    And so, again, the 50th anniversary of the Civil Rights Act 
is something that we observed as a nation this year. I think, 
again, Mr. Foreman, helped try and sort of rebalance the record 
here today into showing that there still are people who suffer 
from racial and civil rights violations in this country. The 
EEOC has a very necessary role in our economy, in our country. 
And what, I think, hopefully this committee will do is come up 
with strategies that, in my opinion, does not trample on the 
mission of Title VII and the Civil Rights Act but, in fact, in 
a measured, balanced way move our country forward. Which is 
really the best way to celebrate the 50th anniversary of the 
Civil Rights Act.
    And with that, I yield back.
    Chairman Walberg. I thank the gentleman, and I take his 
points. We are also celebrating Constitution Day today. That is 
an important document as well that I think gives an awful lot 
of direction for what we are to do in Congress. You mentioned 
Boston, I will mention the Tigers right now. And we are hopeful 
that they have a better opportunity of being in the World 
Series. But that is not certain. It could change this weekend.
    There are 384--at least 384 bills that sit over in the 
Senate right now that have been passed after significant 
effort, after this body has spoken. Much of that wealth of 
legislation is bipartisan, to some degree. It sits over in the 
Senate without any action. We don't reasonably expect them to 
take action on it, sadly. But we certainly expect us--and as we 
have opportunity we expect us--to take action here, and address 
issues that have perked to the top with great concern. And that 
has been the case. We have had the EEOC over here. We have 
had--I have had the EEOC in my office. We have sent letters. We 
continue to have concerns that are expressed.
    The overriding intent of Congress in putting the EEOC into 
operation was to clearly give the opportunity to make sure that 
unnecessary--well, let me change that. That--I was going to say 
unnecessary time was not spent. But I am going to say that all 
necessary time would be spent on making sure that 
discrimination did not happen, that people were afforded--
regardless of who they are, what they believe, the color of 
their skin, their gender, their disabilities, were not 
discriminated against. And that complaints were brought before 
a Commission. And we established a Commission to be a 
Commission with some latitude to decide how they function, to 
some degree. But a Commission to clearly make decisions that 
had impact upon equal rights and opportunity and the way 
businesses functioned.
    And so I guess today is, I hope, not an exercise in 
futility, but a laying down and establishing a claim by 
Congress on its concern that issues of concern be addressed. 
And if there are better ways of dealing--and enhancing this 
legislation that has been put forward, we are certainly willing 
to look at it. But when you have 70,000 complainants expecting 
some response by a Commission that is a backlog right now, and 
you have other complaint--other cases that are being initiated 
without complaint--I think that is a problem we ought to ask 
questions, at the very least, about. And that the EEOC ought to 
know that there are members of Congress on this subcommittee, 
on the full Committee and in Congress at large that want those 
issues of concern addressed and not just carrying on the same 
old, same old.
    When you have actions without employee complaint, when you 
have uncertainty, inconsistency being brought into the mindset 
of businesses, employers, and employees attempting to 
understand the system, we ought to address that concern. At 
least ask questions. And hopefully the EEOC is listening. They 
certainly have an opportunity to respond--and I am sure they 
are listening--respond in letter to us expressing concerns, 
expressing ideas; some that have been addressed today here 
already by our witness panel of suggestions on how legislation 
could be addressed to go forward.
    The hearing at least, as I said, lays a claim to carrying 
on our concern. Whether it is successfully concluded with this 
session of Congress, or whether it establishes a base to pursue 
more aggressively to conclusion in the next Congress, I think 
that is an important opportunity and responsibility of this 
subcommittee. Having said all of that, we will look forward to 
the response, as well as carrying on further.
    I again want to thank the panel for being here. I thank my 
committee members for their attention today.
    And there being no further business, the subcommittee 
stands adjoined.
    [Additional submission by Mr. Courtney follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    [Whereupon, at 11:32 a.m., the subcommittee was adjourned.]

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