Employment Practice Litigation: When To Fight And When To Settle

Written exclusively for My Community Workplace for Not-For-Profits Organizations

The American Civil Liberties Union (ACLU) will receive $1.3 million from a Virginia school board to cover the nonprofit's legal costs for more than six years of litigation.

The ACLU sued the school board on behalf of a transitioning transgender student, arguing the school's policy requiring students to use the bathroom that corresponds with the student's biological sex is an illegal, discriminatory policy. In the case, the student alleged he suffered physical and psychological injury as a result of the policy.

Lower courts found in favor of the ACLU, affirming that such a policy was unconstitutional and discriminatory as against the transitioning student. The U.S. Supreme Court's refusal to grant the school board's appeal in June of this year ended the legal battle.

The amount of money the school board spent on its own legal costs is unknown. "A School Board Will Pay $1.3M Over A Trans Student's Lawsuit Against Its Bathroom Ban" www.npr.org (Aug. 27, 2021).

Commentary and Checklist

Deciding whether to settle a case or go to trial can be a difficult process and must be considered carefully.

Avoiding litigation in the first place, with clear discrimination and harassment policies and a detailed procedure for addressing and investigating complaints, is a best practice for any organization. However, when a complaint escalates to litigation, an evaluation of your legal options is essential.

The cost of litigation is often the primary consideration because legal costs can reach into the millions of dollars, especially if you have to pay the fees of the other side, like in the above case.

Aside from the monetary risk, organizations also need to consider the risk to reputation, and the strain on employee morale and workplace productivity that a lawsuit creates. Discrimination and harassment lawsuits, in particular, can evoke an image of an organization that is fighting its employees.

Here are some further points to consider when deciding between settlement and trial:

  • Take your emotions out of the decision of whether to settle or try a case. You should make a business, not an emotional, decision.
  • When considering the price of going to trial, make certain that you add all fees and other costs. If you lose, will you be ordered to pay your opponent's legal fees and costs?
  • Be sure to consider the time that will be required, including the cost of the time of your employees responding to discovery requests and attending depositions, when deciding to begin or continue litigation.
  • Make certain that your attorneys continually communicate with the plaintiff or their attorneys. Good communication and professional demeanor will allow for a better settlement offer.
  • When mapping your defense, make certain that settlement is always an option, and that settlement is explored as early as possible before fees escalate.
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