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Is there an increase in EEOC lawsuits during economic downturns?

Team Disclo
March 26, 2024

It is generally believed that during financial downturns, when organizations are struggling to cut costs, there may be an increase in discrimination lawsuits brought by the Equal Employment Opportunity Commission (EEOC). This is because, during difficult economic times, companies may be more likely to cut costs by laying off employees or reducing their hours, and this can lead to discrimination against certain groups of employees, such as those who are older or those with disabilities.

Reduction in force: During a downturn, companies may be more likely to implement layoffs or reductions in force, which can lead to discrimination if certain groups of employees are disproportionately affected. For example, older employees or those with disabilities may be more likely to be targeted for layoffs.

Harassment and discrimination: Financial stress can lead to increased pressure on employees, which can in turn lead to an increase in harassment and discrimination. This can be exacerbated by a lack of oversight and training on these issues.

Failure to accommodate: Companies facing financial difficulty may be more likely to resist providing accommodations to employees with disabilities. This can result in discrimination lawsuits.

Retaliation: Employees who assert their rights under the law or report discrimination, may be more likely to face retaliation, particularly during difficult economic times when companies are looking to cut costs.

It goes without saying that discrimination is illegal and not acceptable in any circumstances, regardless of the state of the economy. Employers should make sure that their hiring, promotion, and termination decisions are based on merit, and that all employees are treated fairly and equitably. Employers should also be proactive in preventing discrimination, harassment and retaliation by implementing training, policies and procedures to ensure a discrimination-free workplace. Additionally, employers should have a process in place for employees to safely disclose and ask for support at work.

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