EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement ( 2014 )

EEOC Authority to Order Federal Agency to
Pay for Breach of Settlement Agreement
Based on principles of sovereign immunity, the Equal Employment Opportunity Commis-
sion lacks authority to order the Social Security Administration to pay a monetary
award as a remedy for breach of a settlement agreement entered to resolve a dispute
under Title VII of the Civil Rights Act of 1964.
August 13, 2014
MEMORANDUM OPINION FOR THE GENERAL COUNSEL
SOCIAL SECURITY ADMINISTRATION
This memorandum responds to your letter of March 28, 2013, request-
ing our views on the authority of the Equal Employment Opportunity
Commission (“EEOC”) to order the Social Security Administration
(“SSA”) to pay a monetary award as a remedy for breach of a settlement
agreement entered to resolve a dispute under Title VII of the Civil
Rights Act of 1964. 1 We conclude, based on principles of sovereign
immunity, that EEOC lacks authority to order SSA to pay such a mone-
tary award for breach of the settlement agreement.
I.
Title VII of the Civil Rights Act of 1964 prohibits employment dis-
crimination based on race, color, religion, sex, and national origin. 42
1 Memorandum for Virginia A. Seitz, Assistant Attorney General, Office of Legal
Counsel (“OLC”), from David Black, General Counsel, SSA, Re: Equal Employment
Opportunity Commission’s Monetary Award Authority (Mar. 28, 2013). In considering
SSA’s request, we received additional views from that agency. See E-mail for OLC from
Andrew Maunz, Office of the General Counsel, SSA, Re: Additional Questions (June 14,
2013) (“Maunz E-mail”); E-mail for OLC from Jay Ortis, Director, Labor and Employ-
ment Division, Office of General Law, SSA, Re: Fwd: Solicitation of Views (July 17,
2013, 9:58 AM). We also obtained the views of EEOC and the Civil Division of the
Department of Justice. See Letter for John E. Bies, Deputy Assistant Attorney General,
OLC, from Peggy R. Mastroianni, Legal Counsel, EEOC, Re: Social Security Administra-
tion Request for OLC Opinion (July 2, 2013); E-mail for OLC from Gary Hozempa,
Office of Legal Counsel, EEOC, Re: EEOC Breach of Settlement Decisions re Social
Security Administration (July 23, 2013, 2:16 PM); E-mail for OLC from Kerry A.
Bollerman, Civil Division, Department of Justice, Re: Solicitation of Views (May 14,
2013, 5:20 PM).
22
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
U.S.C. § 2000e-2(a) (2012). A provision of Title VII extends this prohi-
bition to employment by the federal government. Title VII’s federal-
sector provision states that “[a]ll personnel actions affecting employees
or applicants for employment . . . in executive agencies . . . shall be made
free from any discrimination based on race, color, religion, sex, or na-
tional origin.” Id. § 2000e-16(a). Congress authorized EEOC “to enforce
the provisions of [section 2000e-16(a)] through appropriate remedies,
including reinstatement or hiring of employees with or without back
pay.” Id. § 2000e-16(b). In addition, Congress authorized EEOC to
“issue such rules, regulations, orders and instructions as it deems neces-
sary and appropriate to carry out its responsibilities under [section
2000e-16].” Id.
Title VII and EEOC regulations set out a procedure for the filing, pro-
cessing, and adjudication of complaints of unlawful discrimination in
federal employment. The regulations, however, reflect a preference for
voluntary settlement of discrimination complaints, see 29 C.F.R.
§ 1614.603 (2013), and treat settlement agreements as binding on the
parties, id. § 1614.504(a). If a complainant believes that the respondent
agency has failed to comply with the agreement, the regulations allow the
complainant to “request that the terms of the settlement agreement be
specifically implemented or, alternatively, that the complaint be reinstated
for further processing from the point processing ceased.” Id. If EEOC
determines that the agency is not in compliance with the settlement
agreement, the regulations provide that EEOC may “order . . . compliance
with the . . . settlement agreement, or, alternatively, . . . order that the
complaint be reinstated for further processing from the point processing
ceased.” Id. § 1614.504(c). The regulations further provide that “allega-
tions that subsequent acts of discrimination violate a settlement agreement
shall be processed as separate complaints . . . rather than [through actions
to enforce the settlement].” Id.
In 1995, a group of African-American male employees working in the
Baltimore, Maryland headquarters of SSA filed a class complaint alleging
that the agency had discriminated against them with respect to promo-
tions, awards, bonuses, and other personnel decisions. EEOC certified the
class in 1998. The parties subsequently decided to settle their dispute and
entered into an agreement under which the class members received mone-
tary and non-monetary relief in exchange for dismissing their complaint.
23
38 Op. O.L.C. 22 (2014)
See Settlement Agreement, Burden v. Barnhart, EEOC Case No. 120-99-
6378X (Jan. 11, 2002) (“Settlement Agreement”). The Settlement Agree-
ment made clear that it did not “represent an admission of liability by
[SSA].” Id. at 20.
Pertinent here, Provision III.D of the Settlement Agreement, which ap-
pears under the heading “Non-Monetary Relief,” reads in relevant part:
[SSA] agrees that its policies and practices for granting perfor-
mance awards and Quality Step Increases will be fair and equita-
ble and consistent with merit principles. [SSA] agrees that it will
correct any misapplications of its policies for granting perfor-
mance awards and Quality Step Increases to ensure fair and equi-
table distribution of such awards, consistent with merit principles.
At [SSA’s] discretion, an expert may be retained to recommend
ways to assess these policies and practices and to ensure compli-
ance with relevant statutes, regulations, EEO principles, and appli-
cable collective bargaining agreements in [SSA’s] awards process.
Any corrections [SSA] implements will be made after providing a
30-day notice and comment period to the Oversight Committee.
[SSA] will provide a report to the Administrative Judge within 6
months of the Effective Date of this agreement of the actions it has
taken to comply with this paragraph.
Id. at 10. The Settlement Agreement provided that the Administrative
Judge (“AJ”) would “retain jurisdiction over this matter for a period of 4
years” to monitor compliance with the agreement. Id. at 6.
In 2005, the class contended that SSA had not fulfilled its obligation to
correct “misapplications of its policies for granting performance awards
and Quality Step Increases.” The class accordingly requested that the
agency provide a “corrective action plan.” Letter for John E. Bies, Deputy
Assistant Attorney General, Office of Legal Counsel, from Peggy R.
Mastroianni, Legal Counsel, EEOC, Re: Social Security Administration
Request for OLC Opinion at 2 (July 2, 2013) (“EEOC Letter”). SSA
responded that the expert analysis on which the class premised its request
was flawed, and promised to hire another expert. Id.SSA delivered a second expert report to the class in 2006. That report
showed underrepresentation of African-American males in the distribution
of Quality Step Increases (“QSIs”), cash awards, and honor awards in
24
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
certain SSA offices. In a September 2006 letter, SSA set forth a plan to
address the areas of concern identified in the report and to prevent future
disparities.
The class subsequently requested that the AJ find that SSA was not in
compliance with the Settlement Agreement, arguing that the agency had
not offered a plan to correct all of the disparities revealed in the second
expert report. See Jefferson v. Astrue, Hearing No. 120-99-6378X, slip
op. at 11 (Apr. 28, 2011) (“OFO Decision”). The judge denied the motion
as moot because SSA had provided the statistical information the class
demanded. Id. at 12.
The complainants appealed the AJ’s decision to EEOC’s Office of
Federal Operations (“OFO”). In their appeal, the class members request-
ed specific implementation of Provision III.D, which, they argued, in-
cluded retroactive awards and QSIs for class members who had been
unfairly denied those benefits. Class Brief in Support of Appeal at 13–14,
Burden v. Astrue, EEOC Case No. 120-99-6378X (May 20, 2008) (“Class
Brief in Support of Appeal”). SSA, on the other hand, took the position
that implementation of Provision III.D did not include retroactive awards
and QSIs. The Settlement Agreement, the agency contended, did not
authorize prospective relief for any alleged breach; while SSA had
agreed to ensure that its policies for awarding promotions and other
honors would be fair and equitable and to correct any misapplications of
its policies, it had not agreed that the distribution of such benefits would
be mathematically exact, or that the class members would be entitled to
relief in the event they disagreed with the distribution of awards. Agen-
cy’s Response to Class’s Brief on Appeal at 8–10, Burden v. Astrue,
EEOC Case No. 120-99-6378X (May 20, 2008) (“Agency’s Response to
Class’s Brief on Appeal”).
OFO, acting on behalf of the Commission, reversed the AJ’s decision.
Relying on the 2006 expert report, OFO found that “the Agency did not
ensure that its policies and practices for granting performance awards and
QSIs were fair and equitable between April 1, 2003 and September 30,
2005.” OFO Decision at 18. OFO further found that SSA had failed to
correct misapplications of its policies to ensure fair and equitable distri-
bution of awards. OFO explained that there was no evidence to show
that the policies and procedures described in SSA’s September 2006
letter had been implemented or that the agency had effectively corrected
25
38 Op. O.L.C. 22 (2014)
the misapplication of its policy for granting performance awards and
QSIs. See id. at 19.
Based on these conclusions, OFO determined that the complaining
class members were “entitled to specific enforcement of the class set-
tlement agreement.” Id. OFO then ordered that “all African-American
males working for the Agency’s Headquarters Office in Baltimore,
Maryland from April 1, 2003, through September 30, 2005, [be] pre-
sumptively entitled to the average honor award, monetary award, and
QSI received during the relevant time.” Id. OFO added that “the pre-
sumption of entitlement to the average honor award, monetary award,
and QSI can be rebutted if the Agency can establish by clear and con-
vincing evidence that an employee is not entitled to this relief.” Id.OFO remanded the case to an administrative judge to oversee the pro-
cessing of relief, including calculating the total and individual amounts
due. Id. at 20.
SSA sought reconsideration of the decision, arguing that the relief
awarded exceeded the scope of EEOC’s authority. OFO denied the mo-
tion. Jefferson v. Astrue, Hearing No. 120-99-6378X (Dec. 18, 2012).
SSA then submitted its request for the views of this Office on whether
EEOC had authority to order the agency to pay a monetary award for
breach of a settlement agreement, contending that the absence of an
applicable waiver of sovereign immunity precludes EEOC from ordering
SSA to pay such a monetary award.
II.
A.
The question whether EEOC has authority to issue a monetary award to
remedy a breach of a settlement agreement by a federal agency turns on
the doctrine of sovereign immunity, which bars suit against the federal
government except to the extent it has consented. FDIC v. Meyer, 510
U.S. 471, 475 (1994). Consent to suit must be provided by Congress
explicitly, in clear statutory language; ambiguous statements will not suf-
fice. See Lane v. Pena, 518 U.S. 187, 192 (1996); see also United States
v. Shaw, 309 U.S. 495, 500–01 (1940) (explaining that “without specific
statutory consent, no suit may be brought against the United States. No
officer by his action can confer jurisdiction”). Waivers of sovereign
26
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
immunity are “strictly construed, in terms of [their] scope, in favor of the
sovereign.” Lane, 518 U.S. at 192. Waivers for one type of relief, such as
injunctive relief, do not thereby waive immunity for other forms of relief,
such as money damages. See id. at 195–96; United States v. Nordic Vill.,
503 U.S. 30, 34–37 (1992) (relying on sovereign immunity principles to
construe statutory waiver of sovereign immunity to permit equitable but
not monetary claims); cf. Library of Congress v. Shaw, 478 U.S. 310,
317–19 (1986) (statutory waiver of immunity from attorney’s fees does
not thereby waive immunity from interest on those fees). Rather, “[t]o
sustain a claim that the Government is liable for awards of monetary
damages, the waiver of sovereign immunity must extend unambiguously
to such monetary claims.” Lane, 518 U.S. at 192. We have previously
explained that a statutory provision “does not waive sovereign immunity
for monetary claims” where the provision can plausibly be read in a
manner that would not authorize monetary relief. Authority of the Equal
Employment Opportunity Commission to Impose Monetary Sanctions
Against Federal Agencies for Failure to Comply with Orders Issued by
EEOC Administrative Judges, 27 Op. O.L.C. 24, 26–27 (2003) (“Navy
Opinion”) (citing Availability of Money Damages Under the Religious
Freedom Restoration Act, 18 Op. O.L.C. 180, 180 (1994)). The rule that
suit is permitted only on the terms Congress has authorized extends as
well to matters of forum; a waiver of immunity for suits in one forum
does not necessarily constitute a waiver in all forums. See Shaw, 309 U.S.
at 501 (“Even when suits [against the United States] are authorized[,] they
must be brought only in designated courts.”).
As we observed in a prior opinion, “[a]lthough most of the sovereign
immunity case law arises in the context of suits before federal district
courts, these principles apply with equal force to agency adjudications.”
Navy Opinion, 27 Op. O.L.C. at 27. “In our view, there can be no doubt
that normal sovereign immunity presumptions apply” to the question
whether an agency can itself grant a particular form of relief against the
government. Id. at 28. 2
2 In West v. Gibson, 527 U.S. 212 (1999), the Supreme Court suggested in dicta that
“ordinary sovereign immunity presumptions” may not apply to the question whether an
agency may grant relief against the government when Congress has unambiguously
waived sovereign immunity with respect to that form of relief for claims brought in
district court. Id. at 217. In our 2003 opinion, we disagreed with that suggestion,
27
38 Op. O.L.C. 22 (2014)
In 2003, we considered whether the statute conferring authority on
EEOC to enforce Title VII’s federal-sector provision through “appropriate
remedies,” 42 U.S.C. § 2000e-16(b), supplied the requisite waiver of
sovereign immunity to support an order of attorney’s fees against an
agency as a sanction for failure to follow an administrative judge’s orders.
We concluded that it did not. We observed that section 2000e-16(b)
waives federal agencies’ immunity from suits seeking remedies for unlaw-
ful discrimination, but “[a]ttorney’s fees imposed as a sanction for failure
to comply with AJ orders relating to the adjudicatory process . . . are not a
remedy for any act of discrimination.” Navy Opinion, 27 Op. O.L.C. at
29. We further explained that “neither section 2000e-16(b), nor any other
statute, contains a provision that even pertains to violations of AJ orders,
much less provides an explicit waiver of the government’s immunity to
monetary sanctions for violations of such orders.” Id. Finally, we rejected
EEOC’s argument that the Federal Rules of Civil Procedure supplied the
necessary waiver. “[E]ven if Congress had waived sovereign immunity
for violations of the Federal Rules of Civil Procedure in federal court,” we
explained, “it would not follow that it has also waived immunity for
arguably analogous (though formally distinct) violations before an entire-
ly different body where these rules do not apply.” Id. at 31. “Indeed, . . .
the doctrine of sovereign immunity requires the exact opposite presump-
tion.” Id.
B.
Within this framework, we consider EEOC’s authority to award the
monetary relief at issue in this case. Our 2003 opinion, SSA argues,
compels the conclusion that EEOC may not issue such an award absent an
express waiver of sovereign immunity. No such waiver exists, the agency
urges, because Title VII waives the government’s immunity only for
damages awards upon a finding of unlawful discrimination, and the Set-
tlement Agreement included no admission of liability. Memorandum for
Virginia A. Seitz, Assistant Attorney General, Office of Legal Counsel,
from David Black, General Counsel, SSA, Re: Equal Employment Oppor-
observing that “‘[i]t is settled law that a waiver of sovereign immunity in one forum does
not effect a waiver in other forums.’” Navy Opinion, 27 Op. O.L.C. at 27–28 (quoting
West, 527 U.S. at 226 (Kennedy, J., dissenting)).
28
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
tunity Commission’s Monetary Award Authority at 3 (Mar. 28, 2013)
(“SSA Memorandum”).
EEOC responds that our 2003 opinion is inapposite because the Com-
mission did not impose sanctions on SSA for failing to comply with an
AJ’s order. Rather, “the relief awarded . . . pertains only to SSA’s breach
of an EEOC settlement agreement.” EEOC Letter at 10. In the past,
EEOC observes, we have held that “an agency can award through a
settlement agreement any relief which a court could order if a finding of
prohibited discrimination were made.” Id. (citing Proposed Settlement of
Diamond v. Department of Health and Human Services, 22 Op. O.L.C.
257, 262 (1998) (“Diamond Opinion”)); see also Authority of USDA to
Award Monetary Relief for Discrimination, 18 Op. O.L.C. 52, 53 (1994)
(“USDA Opinion”). In EEOC’s view, it follows that, “when an agency
breaches an EEO settlement, EEOC can order as relief whatever a court
could award upon a finding of a breach.” EEOC Letter at 10. Hence, the
Commission asserts, if a court may order monetary relief upon finding
that an agency has breached a Title VII settlement, so too can EEOC.
EEOC does not appear to dispute that the waiver of sovereign immunity
in Title VII applies only to claims of unlawful discrimination and does not
extend to monetary claims against the government for breach of a Title
VII settlement. See EEOC Letter at 5 & n.2. Rather, EEOC argues that
courts may award money damages for breach of a settlement agreement
under the Tucker Act, which waives the government’s sovereign immuni-
ty with respect to claims “founded . . . upon any express or implied con-
tract with the United States, or for liquidated or unliquidated damages in
cases not sounding in tort.” 28 U.S.C. § 1491(a)(1) (2012). EEOC notes
that in Holmes v. United States, 657 F.3d 1303 (Fed. Cir. 2011), the Fed-
eral Circuit determined that the Court of Federal Claims may exercise
jurisdiction under the Tucker Act over suits alleging breach of a Title VII
settlement, provided that the agreement itself contemplates money dam-
ages in the event of a breach. Id. at 1311–15. The agreement at issue in
this matter, EEOC argues, contemplates money damages in the manner
Holmes requires. Therefore, in EEOC’s view, the Tucker Act’s waiver
applies, and sovereign immunity poses no bar to the Commission’s order
of the monetary relief at issue in this matter.
EEOC further contends that “the fact that the waiver [of sovereign
immunity]” is found in the Tucker Act rather than Title VII “is not
29
38 Op. O.L.C. 22 (2014)
significant vis-à-vis EEOC’s authority to award back pay.” EEOC Letter
at 11. In West v. Gibson, 527 U.S. 212 (1999), EEOC notes, the Su-
preme Court held that EEOC may award compensatory damages as an
“appropriate remed[y]” for a violation of Title VII, 42 U.S.C. § 2000e-
16(b), even though the provision authorizing that form of relief is found
in a 1991 Title VII amendment that expanded the remedial authority of
courts without explicitly referring to EEOC proceedings. 527 U.S. at
217. Similarly, here, EEOC argues that the Commission has authority to
award money damages for breach of a Title VII settlement agreement
because of the waiver of immunity contained in the Tucker Act. A
contrary conclusion, EEOC contends, would “strip EEOC’s authority to
enforce Title VII against agencies through appropriate remedies, and rob
it of the ability to ensure that an agency complies with its Title VII
settlement promises.” EEOC Letter at 11 (internal quotation marks
omitted).
III.
A.
We are not persuaded by EEOC’s arguments. EEOC’s reliance on
the Tucker Act is misplaced because the Tucker Act confers jurisdic-
tion only on the Court of Federal Claims to hear contractual claims
against the United States exceeding $10,000. See 28 U.S.C.
§ 1491(a)(1) (“The United States Court of Federal Claims shall have
jurisdiction to render judgment upon any claim against the United
States founded either upon the Constitution, or any Act of Congress or
any regulation of an executive department, or upon any express or
implied contract with the United States, or for liquidated or unliquidat-
ed damages in cases not sounding in tort.”). 3 That limited waiver of
sovereign immunity does not authorize EEOC to provide a forum for
such disputes. See Shaw, 309 U.S. at 501 (“Even when suits [against
the United States] are authorized[,] they must be brought only in des-
ignated courts.”); cf. Minnesota v. United States, 305 U.S. 382, 388
3 Section 1346 of title 28, known as the “Little Tucker Act,” confers jurisdiction on
United States district courts for claims founded “upon any express or implied contract
with the United States” that do not exceed $10,000.
30
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
(1939) (“[I]t rests with Congress to determine not only whether the
United States may be sued, but in what courts the suit may be
brought.”).
1.
In Holmes, on which EEOC places principal reliance, the Federal Cir-
cuit determined that Title VII posed no bar to the Court of Federal
Claims’ exercise of jurisdiction under the Tucker Act to adjudicate a
claim that an agency breached a Title VII settlement agreement, not-
withstanding Title VII’s comprehensive remedial scheme and its conferral
of jurisdiction on federal district courts. 657 F.3d at 1312–13. 4 In so
holding, the court relied on the Supreme Court’s decision in Kokkonen v.
Guardian Life Insurance, 511 U.S. 375 (1994), which held that a court
with jurisdiction over an underlying dispute does not necessarily also
have jurisdiction over claims that parties have breached an agreement
settling that dispute. Id. at 381. Rather, the Court ruled, an independent
basis of jurisdiction is generally needed for a federal court to adjudicate
such breach of settlement claims. Id.; see Holmes, 657 F.3d at 1312–13.
Following Kokkonen, the Federal Circuit explained that, “although the
[settlement agreement] arose out of Title VII litigation, [the plaintiff’s]
suit for breach of contract is just that: a suit to enforce a contract with the
government.” 657 F.3d at 1312. The court therefore held that the case was
properly heard in the Court of Federal Claims under the Tucker Act,
rather than in the federal district courts authorized to hear claims under
Title VII.
Conversely, federal courts with jurisdiction over Title VII claims have
held that they may not adjudicate claims for damages resulting from a
federal agency’s breach of a Title VII settlement agreement. See Taylor v.
Geithner, 703 F.3d 328, 334 (6th Cir. 2013); see also Munoz v. Mabus,
630 F.3d 856, 861–64 (9th Cir. 2010); Frahm v. United States, 492 F.3d
258, 262–63 (4th Cir. 2007); Lindstrom v. United States, 510 F.3d 1191,
4 Neither party challenges this aspect of the Federal Circuit’s decision; we therefore
assume that it is correct for purposes of this opinion. As it is irrelevant to our resolution
of the question presented, we likewise take no position on the parties’ dispute over
whether the contract at issue contemplates money damages. Compare EEOC Letter at 6–8
with Maunz E-mail, supra note 1.
31
38 Op. O.L.C. 22 (2014)
1194–96 (10th Cir. 2007). Those courts have explained that the waiver of
sovereign immunity in Title VII, which authorizes suits against federal
agencies for unlawful discrimination, “does not expressly extend to mone-
tary claims against the government for breach of a settlement agreement
that resolves a Title VII dispute.” Frahm, 492 F.3d at 262. And while the
waiver of sovereign immunity in the Tucker Act does extend to such
claims, “invoking the Tucker Act is a non sequitur” in federal district
court, “because where . . . a suit involves a claim for money damages over
$10,000, the Act waives the government’s immunity only in the Court of
Federal Claims.” Franklin-Mason v. Mabus, 742 F.3d 1051, 1054 (D.C.
Cir. 2014); see id. at 1056 (“[T]he Tucker Act does not contain a waiver
of sovereign immunity in the district court for breach of a Title VII set-
tlement agreement seeking damages in excess of $10,000.” (emphasis
added)); accord Munoz, 630 F.3d at 864 (“Because [the plaintiff’s] breach
of settlement agreement claim is essentially a contract action against the
federal government whose resolution requires no interpretation of Title
VII itself, his claim cannot seek jurisdictional refuge in Title VII and
belongs, if anywhere, in the Court of Federal Claims.”). 5
This case law highlights why, even if we were to accept EEOC’s posi-
tion that it “can order as relief whatever a court could award upon a
finding of a breach,” EEOC Letter at 10, that standard does not help its
case. The waiver of sovereign immunity in the Tucker Act is limited to
cases heard in the Court of Federal Claims. It does not waive the federal
government’s immunity, either in federal district court or in EEOC pro-
ceedings, for claims arising from breach of a settlement agreement. As
explained above, waivers of sovereign immunity are to be “strictly con-
strued, in terms of [their] scope, in favor of the sovereign.” Lane, 518
U.S. at 192. Consequently, the Tucker Act provides no authority for
EEOC to award money damages to remedy a federal agency’s breach of a
Title VII settlement.
5 Notably, “unlike the district courts, . . . the [Court of Federal Claims] has no general
power to provide equitable relief against the Government or its officers.” United States v.
Tohono O’Odham Nation, 563 U.S. 307, 313 (2011). And the Federal Circuit has found
that “[e]xcept in strictly limited circumstances . . . there is no provision in the Tucker Act
authorizing the Court of Federal Claims to order equitable relief.” Massie v. United
States, 226 F.3d 1318, 1321 (2000).
32
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
2.
The Supreme Court’s decision in West does not compel a contrary re-
sult. In that case, the Supreme Court construed the provision granting
EEOC authority to enforce Title VII “through appropriate remedies,” 42
U.S.C. § 2000e-16(b), as including the power to order remedies Congress
deemed appropriate for enforcing Title VII’s substantive provisions in a
later Title VII amendment. 527 U.S. at 218. Because Congress determined
that compensatory damages are an appropriate remedy for victims of
discrimination by federal agencies in the Civil Rights Act of 1991, the
Court concluded, section 2000e-16(b) authorizes EEOC to afford such
relief in its enforcement proceedings. Id. at 218–19.
West provides no support for construing the limited waiver of sovereign
immunity in the Tucker Act to apply to breach-of-settlement proceedings
before EEOC. Unlike the Civil Rights Act of 1991, which amended Title
VII itself, the Tucker Act is an unrelated statute that predated Title VII by
several decades and as such says nothing about the remedies Congress
considered suitable to effectuate the aims of Title VII. Cf. id. at 218 (“[I]n
context the word ‘appropriate’ most naturally refers to forms of relief that
Title VII itself authorizes.” (emphasis added)). More fundamentally, this
matter does not concern the scope of EEOC’s authority to award “appro-
priate remedies” for workplace discrimination, but its authority to award
remedies for a federal agency’s breach of a settlement agreement. See
Frahm, 492 F.3d at 262–63 (section 2000e-16(b) waives the government’s
sovereign immunity with respect to substantive Title VII claims but “does
not expressly extend to monetary claims against the government for
breach of a settlement agreement that resolves a Title VII dispute”). The
Court’s interpretation of the term “appropriate remedies” as it appears in
Title VII provides no basis for reading the limited waiver of sovereign
immunity in the Tucker Act to authorize EEOC to award monetary relief
for a federal agency’s breach of a Title VII settlement agreement.
B.
In addition to considering EEOC’s argument that the Tucker Act allows
it to order a compensatory remedy for breach of a settlement agreement,
we have also considered whether EEOC’s award of monetary relief is
authorized by Title VII itself insofar as the award constitutes an order to
33
38 Op. O.L.C. 22 (2014)
perform on promises SSA made in the Settlement Agreement—in particu-
lar, promises to “distribute performance awards on a fair and equitable
basis, consistent with merit principles” and “to take corrective action if it
did not keep this promise.” See EEOC Letter at 12 (“SSA promised to
distribute performance awards on a fair and equitable basis, consistent
with merit principles. It also promised to take corrective action if it did
not keep this promise. OFO found that SSA breached these promises. As
relief, EEOC ordered SSA to take corrective action, the very corrective
action which SSA promised to, but did not, take.”).
As EEOC notes, this Office has repeatedly recognized that Title VII’s
waiver of sovereign immunity means that an agency may settle an admin-
istrative Title VII complaint by awarding monetary relief to a complain-
ant, even without admitting liability for the alleged discrimination. USDA
Opinion, 18 Op. O.L.C. at 52–54; see Diamond Opinion, 22 Op. O.L.C. at
261 & n.6 (quoting Local No. 93, Int’l Ass’n of Firefighters v. City of
Cleveland, 478 U.S. 501, 515 (1986)). As long as the intended relief does
not exceed the scope of remedies available in court, the government’s
consent to be sued for violations of Title VII ordinarily permits voluntary
settlement of a complaint alleging such violations. See Diamond Opinion,
22 Op. O.L.C. at 261–62 & n.6; see also USDA Opinion, 18 Op. O.L.C.
at 53 (explaining that, under appropriations law, “agencies have authority
to provide for monetary relief in a voluntary settlement of a discrimina-
tion claim only if the agency would be subject to such relief in a court
action regarding such discrimination brought by the aggrieved person”).
It might follow from this principle that EEOC has authority in certain
circumstances to enforce a settlement agreement by ordering an agency
to perform on its promises, even if those promises include a commitment
to pay money to a complainant. If, for example, the agency had settled a
Title VII claim by promising to provide a particular amount of back pay
or other monetary relief and the complainant requested specific perfor-
mance of that promise, EEOC might be able to order that relief without
violating the doctrine of sovereign immunity. In such a circumstance,
one could argue that the dispute is not, in essence, a contract dispute
with the federal government, but rather a continuation of the same Title
VII proceeding that gave rise to the settlement itself. Consequently, the
same waiver of sovereign immunity that permitted the agency to resolve
34
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
the Title VII complaint by voluntary settlement might also permit EEOC
to compel the agency to make good on its promise. 6
But whatever effect the waiver of sovereign immunity in Title VII
might have on EEOC’s authority to award monetary relief in other
circumstances, we do not believe it authorizes the monetary award at
issue here. The award at issue was not an order to perform on an agree-
ment that provided back pay or other specific monetary relief to settle an
underlying Title VII claim alleging past misconduct. Rather, it was an
order to perform on a promise to take corrective action in the future to
remedy any failure to distribute performance awards and QSIs on a “fair
and equitable basis.” EEOC Letter at 12. Based on two principal consid-
erations, we conclude that, for purposes of the sovereign immunity
analysis, the dispute at issue here cannot fairly be characterized as
merely a continuation of the same Title VII proceeding that gave rise to
the settlement itself. Accordingly, the remedy EEOC awarded is not
authorized by the waiver of sovereign immunity that allowed SSA to
settle the class complaint and provide relief to the claimants in the first
place.
The nature of the present dispute over the meaning and application of
Provision III.D illustrates that the dispute was not merely a continuation
of the Title VII claim that gave rise to the settlement, but rather a distinct
proceeding beyond the scope of the waiver of sovereign immunity upon
which the settlement rested. First, the present dispute does not concern a
specific settlement term that imposes clear obligations on the SSA—such
as an agreement to provide a particular sum in back pay—but instead
concerns SSA’s alleged failure to comply with a non-specific prospective
promise to “correct any misapplications of its policies for granting per-
formance awards and Quality Step Increases to ensure fair and equitable
distribution of such awards, consistent with merit principles.” Settlement
Agreement at 10. As SSA points out, in agreeing to this provision, it
neither expressly consented to a particular numerical distribution of
awards and QSIs, nor expressly agreed that the class members would be
entitled to monetary relief in the event that they were dissatisfied with the
number of awards and promotions received. Agency’s Response to
6Editor’s Note: The text of this footnote has been redacted. It includes privileged
information and addresses an issue not necessary for the discussion here.
35
38 Op. O.L.C. 22 (2014)
Class’s Brief on Appeal at 8–10. Provision III.D, SSA observes, “contains
no discussion of a monetary component and neither memorializes nor
evidences a meeting of the minds between the parties that all class mem-
bers could receive the average monetary award, or any monetary award
for that matter, for the oversight period.” SSA Memorandum at 3–4.
Rather, in SSA’s view, the disputed settlement term simply required
compliance with merit principles and active oversight of its policies for
issuing promotions and performance awards. See Maunz E-mail, supra
note 1 (“[S]pecific enforcement [of Provision III.D] could include an
ordered review of the agency’s policies, perhaps even by an expert.”). As
a consequence, the proceedings regarding the enforcement dispute at issue
required not only extensive debate over the meaning of SSA’s promise to
distribute awards and QSIs on a “fair and equitable basis” and to “correct
any misapplications of its policies,” but also extensive fact-finding re-
garding SSA’s post-settlement conduct to determine whether the relevant
standards had been met. See OFO Decision at 16–19. 7
7 Although OFO characterized its order as “specific enforcement” of the Settlement
Agreement, we note that OFO’s order appears more akin to a legal remedy for breach than
the equitable remedy of specific performance as that term is generally understood in
contract law. The Supreme Court has observed that specific performance requires an
agreement that is “certain, fair, and just in all its parts.” Dalzell v. Dueber Watch-Case
Mfg. Co., 149 U.S. 315, 325 (1893). “‘The contract which is sought to be specifically
executed ought not only to be proved,’” the Court explained, “‘but the terms of it should
be so precise as that neither party could reasonably misunderstand them.’” Id. at 326(quoting Colson v. Thompson, 15 U.S. (2 Wheat.) 336, 341 (1817)). Accordingly, “‘[i]f
the contract be vague or uncertain . . . a court of equity will not exercise its extraordinary
jurisdiction to enforce it, but will leave the party to his legal remedy.’” Id. (quoting
Colson, 15 U.S. (2 Wheat.) at 341); see also Restatement (Second) of Contracts § 368
(1981) (“Specific performance . . . will not be granted unless the terms of the contract are
sufficiently certain to provide a basis for an appropriate order.”).
In determining that the class members were presumptively “entitled to the average
honor award, monetary award, and QSI” (a number unknown at the time of decision), we
do not believe that OFO enforced a term “‘so precise as that neither party could reasona-
bly misunderstand [it].’” Dalzell, 149 U.S. at 326 (quoting Colson, 15 U.S. (2 Wheat.) at
341); cf. TAS Distrib. Co., Inc. v. Cummins Engine Co., 491 F.3d 625, 637 (7th Cir. 2007)
(rejecting claim that district court abused its discretion in refusing to order defendant to
specifically perform on its “obligation to make ‘all reasonable efforts’ to manufacture and
market the subject technology”).
36
EEOC Authority to Order Federal Agency to Pay for Breach of Settlement Agreement
Second, the present dispute does not concern monetary remedies for the
alleged Title VII violations underlying the settlement, but monetary
remedies for failure to comply with a settlement term governing SSA’s
future conduct, i.e., SSA’s failure to distribute performance awards and
QSIs on a “fair and equitable” basis after the settlement was reached. That
is apparent from the extensive fact-finding required to determine SSA’s
compliance with Provision III.D—if the monetary remedy awarded to the
class members in the present dispute rested on the conduct that gave rise
to their initial Title VII claims, there would have been no need for such
additional fact-finding because those claims were resolved by the Settle-
ment Agreement. It is, at a minimum, questionable whether the waiver of
sovereign immunity in Title VII that permitted SSA to enter the Settle-
ment Agreement in the first place would also permit SSA to promise to
provide a monetary remedy in the event it failed to abide by a promise to
refrain from particular conduct in the future. We have previously ob-
served that, consistent with limitations on agencies’ ability to compromise
or abandon claims made against the United States in litigation, “settle-
ment of a discrimination claim should be based on the agency’s good faith
assessment of the litigation risk that a court might find complainants
entitled to relief ” based on the claims raised in their complaint. Diamond
Opinion, 22 Op. O.L.C. at 262. An agreement to provide monetary relief
in the event of future noncompliance with a term of the settlement agree-
ment would arguably be an impermissible agreement to compensate
complainants for injuries not alleged in their complaint. Such conduct
would not be at issue if the complainants were to proceed to court on their
original claim. As such, an agreement to provide monetary compensation
for future noncompliance would raise significant questions about whether
the agency had acted in a manner consistent with its obligation to provide
settlement remedies based on a “good faith assessment” of the complain-
ants’ likely recovery from the pending complaint. 8
8 We do not suggest that an agency is precluded from including in a settlement its
promise not to discriminate in the future. Title VII explicitly authorizes courts to enjoin
agencies from engaging in unlawful employment practices. 42 U.S.C. § 2000e-5(g)(1).
And we have recognized that “an appropriate remedy under Title VII . . . may include
relief, including injunctive relief, that will make the plaintiff whole, prevent future
violations of the act, and prevent retaliation against complainants.” Diamond Opinion, 22
Op. O.L.C. at 263. Because agencies may settle a discrimination claim and award any
37
38 Op. O.L.C. 22 (2014)
For both of these reasons, taken together, we conclude that the dispute
at issue was not merely a continuation of the underlying Title VII pro-
ceedings that resulted in the Settlement Agreement, and that the waiver of
sovereign immunity upon which the settlement rested therefore cannot be
said to authorize the award EEOC provided to remedy SSA’s alleged
failure to comply with Provision III.D of the Settlement Agreement. 9
IV.
We conclude that the doctrine of sovereign immunity precludes the
monetary relief ordered in this case.
JOHN E. BIES
Deputy Assistant Attorney General
Office of Legal Counsel
relief that would be available in court, a promise to refrain from discriminatory behavior
in the future would be entirely proper.
9 As noted in Part I, EEOC’s regulations provide that “allegations that subsequent acts
of discrimination violate a settlement agreement shall be processed as separate complaints
. . . rather than [through actions to enforce the settlement].” 29 C.F.R. § 1614.504(c). In
proceedings before OFO, SSA argued that this provision precluded the class from receiv-
ing relief on their claims that the agency’s unequal post-settlement distribution of awards
violated the Settlement Agreement. We express no view on this question, and do not
address the scope of EEOC’s regulations. Rather, we consider the fact that EEOC effec-
tively compensated the class members for discrimination that followed the settlement only
insofar as that fact informs our view that the Commission’s award is barred by the
doctrine of sovereign immunity.
38