Practice Tip: Say What You Mean in Drafting Terms of Settlement Agreements

By Deryn Sumner, January 18, 2017

In issuing one of its last decisions of 2016, the EEOC’s Office of Federal Operations left us with a nice reminder of the importance of being as specific as possible when drafting terms of settlement agreements.  Although everyone in the room might think they have the same understanding of what each side is promising to do, different interpretations can arise after the fact.  At the core, settlement agreements are contracts and are interpreted as such.  The complainant agrees to withdraw his or her EEO complaint with prejudice.  In some instances, he or she even agrees to do more than that, such as resign from the agency as of a specific date.  The agency may agree to a whole host of things (particularly if it is getting the employee to resign as part of the deal) including making monetary payment to the complainant, paying the complainant’s attorneys’ fees and costs, restoring leave, changing personnel files and performance evaluations, providing letters of reference, rescinding suspensions or other disciplinary actions, and even sometimes agreeing to reassign the complainant to a different position away from a specific supervisor.

That’s what the parties agreed to in the case of Ouida L. v. Department of Interior, EEOC Appeal No. 0120162588 (December 30, 2016).  Or at least that’s what the complainant thought she was receiving in exchange for agreeing to settle the case.  The language of the settlement agreement included the following language: “Reassign Complainant under the direct supervision of [the Senior Advisor for Hydropower (“S2”)] instead of [the PRO Manager (“S1”)] effective immediately.”

The decision notes that many of the issues which caused the complainant to file an EEO complaint stemmed from her interactions with her first-line supervisor “S1” and that during the processing of the EEO complaint, the complainant had been placed in a separate chain of command from S1.  After execution of the agreement, the Agency did as agreed and moved the complainant formally to reporting to the S2.  Who, of course, ends up retiring a year later only to be replaced by, you guessed it, S1 who assumes S2’s position.  The complainant contacts the Agency alleging a breach and the Agency finds that considering the plain language of the agreement, no breach occurred.  Which leads us to the appeal of that finding and the EEOC’s decision.

The complainant argued that the intent of the agreement was to place the complainant outside of the chain of command of S1.  The Agency argued that it did as it contracted to do when it reassigned the complainant to the direct supervision of S2, and that the language of the settlement agreement did not say that the complainant would not be in S1’s chain of command.

The Commission, after discussing the Plain Meaning Rule, agreed with the Agency.  It found that removal from S1’s chain of command was not one of the terms of the agreement and that there was no evidence that the settlement agreement was otherwise void, voidable, or that the complainant was misled into signing the agreement, particularly as she was represented by counsel.  The Commission cautioned, as we caution you, readers of the FELTG newsletter now, “if Complainant wanted such constraints imposed on the Agency employee, she should have included such a provision as part of the settlement agreement.”  (internal citations omitted).  Think about the result you want and draft the right language to achieve that result, lest you be stuck litigating enforcement matters forever and ever.  [Editor’s Note: Amen.] Sumner@FELTG.com