CBA or not to CBA: What Controls in Settlement?

By Meghan Droste, August 15, 2018

Time for me to let you in on a little secret, readers — I have a bit of a formula for writing my monthly articles for you. I always start by looking at the most recent EEOC decisions; I pick one that looks interesting and I write an article on it. I like to think this is helpful for you because it keeps you up-to-date on what the EEOC has ruled on in the past few months (and bonus for me: It keeps me up-to-date for my own cases). The selection is a bit dependent on what I find interesting though, which has resulted in a few topics or themes coming up more than once.  One of those topics is settlement agreements. It seems that fewer complaints actually go to a hearing these days, in part, because many of them settle. That makes settlement agreements — both drafting them correctly and then complying with them — very important for agencies and complainants.

The Commission recently reminded us of the importance of being careful when drafting agreements in its decision on a request for reconsideration in the case of Celinda L. v. U.S. Postal Service, EEOC Req. No. 0520180260 (June 7, 2018). In this case, the agency and the complainant reached a settlement that included the offer of adjusting the complainant’s seniority date. The settlement agreement contained a disclaimer that if the provision violated the applicable collective bargaining agreement, the settlement agreement would be null and void.  After the parties signed the agreement, the agency notified the complainant that it believed the settlement agreement violated the collective bargaining agreement, which prohibited the change to her seniority date. The agency offered to modify the seniority date provision of the settlement agreement or to reinstate the underlying EEO complaint. When the complainant did not respond, the agency modified the settlement agreement and notified the complainant of her appeal rights. The complainant filed an appeal and the EEOC issued a decision in her favor. It concluded that the agency “should have raised its concerns about the CBA prior to the execution of the settlement agreement.” The EEOC reversed the agency’s Final Agency Decision finding that it did not breach the agreement. The agency then requested reconsideration, which the Commission denied.

Unfortunately, at the time of writing this article the Commission’s decision on the appeal is not available on Lexis or the EEOC’s website, so I can’t provide you with more details on its reasoning in this specific case. This is not, however, the first time the Commission has addressed this issue. In Inglesias v. U.S. Postal Service, EEOC Req. No. 0520110503, 0520110270 (Mar. 30, 2012), the Commission determined that the Agency could not establish that the settlement agreement in question violated the terms of the collective bargaining agreement. It found an affidavit from a labor relations manager concluding that there was a violation to be insufficient. The Commission also reminded the agency that labor relations should review settlement agreements before the parties sign them, to avoid these situations.

Settlement agreements are contracts. The parties are generally bound to them even if they come to regret them later. If there is even a remote chance that the terms of a settlement agreement might violate a collective bargaining agreement, please be sure to get your agency’s labor relations team involved before anyone puts ink to paper and finalizes the agreement.  If you don’t, you may have to suffer the slings and arrows of an outrageous settlement agreement. Droste@FELTG.com