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Thousands of Labor Suits Could Hit Queue If Courts Furloughed

Jan. 16, 2019, 10:50 AM

Workers suing their employers—and tens of thousands a year do so—could miss deadlines or be pressured into hasty settlements if federal courts pare down to essential staff, attorneys told Bloomberg Law.

More than 25,000 employment-related lawsuits were filed in federal courts in the 12-month period ending June 2018, according to U.S. Courts data. That suggests that thousands of cases could be affected by a partial shutdown. The courts also handled approximately 1,945 appeals involving labor and employment issues during the same time period.

Most federal court civil operations will be stalled Jan. 25 if funding isn’t reinstated, according to the Administrative Office of the U.S. Courts. The Equal Employment Opportunity Commission’s primary operations have been halted for the entirety of the shutdown, slowing oral arguments and delaying deadlines in discrimination suits.

Civil Cases, Move Over

Criminal cases will be given court priority after Jan. 25, log-jamming employment law cases without staff to process them, Holland & Knight partner Eric Crusius told Bloomberg Law.

“If the courthouse is closed and a document filing is necessary, same day in-person filing may not be available,” he said. “Because this is unchartered territory, it is unclear how the courts will handle these varying sticky situations.”

Statutes of Limitations

Filing deadlines related to statutes of limitations aren’t generally suspended during a shutdown, meaning individuals who don’t file a new employment case in time could be out of luck. The Case Management/Electronic Case Files system will remain operational during the shutdown, but workers looking to file a new suit without an attorney may not have the assistance of the clerk’s office, which could hurt their case, New York University Law School professor Shirley Lin said. Deadlines could be missed in the confusion of trying to file a suit electronically, or failing to file in person.

However, this may vary depending on the court, and which staff members are deemed “essential” to process new complaints under the Anti-Deficiency Act, according to the judiciary statement.

Administrative staff might stick around to receive new filings, allowing plaintiffs to file without missing any statutes of limitations, Fisher Phillips partner Richard Meneghello told Bloomberg Law. Either way, the courts will be backlogged, delaying due process.

“If you’ve been discriminated against, going up against a current or worse, a former, employer is already a heavy lift for workers. For civil rights litigants, time is justice,” said Lin, previously a senior associate at Outten & Golden.

Settlement, Please

Speedier resolutions will likely be the most prevalent outcome of the court closure, Sparlin Law Office attorney Dean Sparlin said.

“Pressure from the bench to settle will increase,” he said. Judges have the ability to delay litigation by reshuffling and prioritizing other cases ahead of employment suits. The end result would “likely be fewer cases being resolved by judicial rulings and going up on appeal.”

“In the grand scheme of things, many courts lump all employment law cases into one category,” Meneghello said. “A lot of courts view these as matters of non-urgency.”

The plaintiff often loses leverage the longer a case is pending, especially if he or she is out of work, and might lose the will to pursue the case, said Maya Raghu, director of workplace equality at the National Women’s Law Center. That might give the employer the upper hand in a case.

If the court is significantly backlogged, employees also might take the route of negotiating with an employer directly rather than filing a suit, Meneghello said.

“Even though for the plaintiff it’s a big deal, for the average court I think they might place employment cases at the lower level of the spectrum,” he said. “You wouldn’t have to necessarily rely on this neutral arbiter to resolve the case.”

“That’s when I can imagine both sides picking up the phone and saying ‘Let’s take another run at settlement,’” he said.

To contact the reporter on this story: Paige Smith in Washington at psmith@bloomberglaw.com

To contact the editors responsible for this story: Cathleen O'Connor Schoultz at cschoultz@bloomberglaw.com; Jay-Anne B. Casuga at jcasuga@bloomberglaw.com