Invisible Settlements, Invisible Discrimination

Abstract:     
Invisible settlements make discrimination in the workplace invisible. Now the norm in employment discrimination litigation, these settlements resolve actions through private contractual agreements with confidentiality clauses that prohibit the plaintiff and her attorney from revealing not only the payment amount, but even the existence of and the facts surrounding the underlying claim. The court record indicates only that the action was dismissed by stipulation, for which no judicial approval is required. Successful outcomes for discrimination victims are shielded from judicial and public attention, lending credence to claims that discrimination in the workplace largely has been eradicated.

Invisibility defeats the intent of the discrimination statutes, skews empirical studies of discrimination litigation, which inform the public debate about the prevalence of bias, and hampers lawyers' ability to counsel and negotiate on behalf of discrimination claimants. The roots of invisibility can be traced to an increasingly privatized model of statutory enforcement, which ignores the deterrence function of public resolutions.

Increased transparency could be achieved by any of the following means. First, the EEOC, which requires a public record of settlements in litigation that it brings, could follow the lead of the United States Department of Labor, which by regulation insists on agency or judicial approval of settlements under the worker protection statutes that it administers. Second, the civil rights bar could take a stand against secrecy, as the personal injury bar has done, and gain agreement from clients in advance to reject settlements that require confidentiality. Finally, at the very least, the courts could require submission of the specific terms of stipulated dismissals, without party identification, so that aggregate data about the nature and extent of settlements in civil rights litigation could be publicly available.

Keywords: employment discrimination, civil rights, settlement

JEL Classifications: K31, K41

Accepted Paper Series