Employers Beware: MCAD Revamps Procedural Regulations

The Massachusetts Commission Against Discrimination has enacted new procedural regulations, which significantly change and complicate the handling of MCAD cases. These new regulations, which became effective January 1, 1999, establish a vastly different case-handling procedure with a much more procedurally intensive method of processing discrimination claims. They usher in a new litigation-oriented process.

New Discovery Rules

Litigation-style discovery is now available at the initial investigative stage to both employers and complainants, provided both are represented by counsel (whether in-house or outside counsel). Such “pre-determination discovery” may include document requests, interrogatories and up to six hours of deposition by either party. MCAD is now issuing “discovery orders” requiring that all discovery be completed within three months.

Parties who are represented by counsel no longer need appear at “investigative conferences.” That is a favorable development, since those brief conferences were not particularly useful. Now, in lieu of these conferences, parties submit briefs of ten pages or less upon completion of pre-determination discovery.

Parties cannot “hide” their counsel from the Commission in an effort to avoid these new discovery rules. Having counsel “ghost-write” pleadings and other submissions behind the scenes breaches ethical obligations imposed by the Massachusetts Rules of Professional Conduct, which mandate disclosure that an attorney is representing the client in an MCAD matter.

Historically, employers and complainants have retained counsel in over two-thirds of MCAD cases. The understaffed and underfunded MCAD implemented these new regulations in the belief the parties themselves have more incentive, and ability, to conduct their own factual investigations. MCAD hopes party-initiated discovery will significantly reduce the time for it to decide whether “probable cause” exists and, therefore, whether a public hearing is required. MCAD has such high hopes for the new regulations that it has issued a self-imposed “probable cause” determination deadline of 18 months after the filing of a complaint.

Improved Efficiency

We welcome the availability of such discovery. With it, we are better able to expose weak cases earlier through deposition questions and other discovery devices. This new process has already resulted in swifter and more favorable resolutions for clients. Further, we now have the ability to issue subpoenas to third parties, a significant advantage given that such information is generally not available through less formal means.

MCAD expects its new procedures will allow it to conduct more intensive investigations in non-attorney assisted cases. MCAD intends to issue document requests and interrogatories, conduct its own witness interviews and make on-site inspections of the employer’s premises in such cases. This seems to be working. In several non-attorney MCAD cases we have handled recently, investigative conferences are being scheduled only four to five weeks after a complaint has been filed, instead of five to six months.

The new regulations also make MCAD practice far more similar to state and federal court litigation practice. For example, in response to a discrimination charge, employers are now required to set forth all legal and factual defenses in their position statements. Failure to raise a defense waives it permanently. Similarly, all motions must conform to a new motion practice procedure based on Massachusetts Superior Court Rule 9A.

Change of Focus

MCAD has changed its focus. It no longer views itself as merely a quasi-judicial agency that adjudicates discrimination claims, but rather as an active enforcement agency intent upon the elimination of all unlawful discrimination. Consistent with that new outlook, MCAD’s new regulations authorize the filing of complaints seeking injunctive relief by MCAD itself. Moreover, the Commission has announced new “Emergency” regulations so matters of significant public interest may proceed to public hearing within 30 days of the filing of a discrimination charge.

Another crucial modification to MCAD practice involves private settlements. Typically, employers seek confidentiality provisions because otherwise the settlement must be viewed by the public as an admission of guilt and, furthermore, other employees who learn about the settlement may bring their own discrimination charges against that employer.

The new regulations give MCAD the discretion to decide whether a given settlement should be approved and kept confidential. Employers who fail to obtain such MCAD approval can become the target of an MCAD-initiated complaint, despite the complainant’s willingness to settle.

*article courtesy of Nixon Peabody LLP.