DI 39518.025 Equal Employment Opportunity -- DDS


Regulations 20 CFR 41, Chapter 1, Subpart 1-15; 20 CFR 404.1626 and 416.1026; 404.1621 and 416.1021; OMB Circular A87, Attachment A and B

A. Policy principle

The State will comply withall applicable Federal statutes, executive orders and regulations concerning equal employment opportunity (EEO).

NOTE:SSA will not fund litigation when the State fails to meet this criteria.

B. Operating policy - out-of-court discrimination settlements

1. Case-by-case basis

The allowance of particular legal fees and settlement costs in EEO cases will be determined on a case-by-case basis.

2. Reasonable cost

  1. a. 

    Legal fees and settlement costs may be determined reasonable and appropriateif the State would have incurred such settlement costs in non-federally funded programs.

  2. b. 

    Settlement must not be a means for States to charge the Federal funds for expenses in situations where a finding of discrimination is likely.

3. State decision

a. Advantages of settlement versus proceeding

The decision by the State to settle a suit, without going to litigation, would likely be based on the fact that the advantages of settlement are thought to outweigh the advantages of proceeding with the lawsuit.

b. Settlement without Federal approval

The State may choose to settle without the approvalof the SSA. However, such a settlement shall involve no costs being chargeable to SSA provided funds.

C. Operating policy - court settlements

1. Finding of no discrimination

The State is entitled to reimbursement for reasonable legal expenses in the defense.

2. Finding of discrimination

The State is liable for all legal expensesincurred in defending the suit and any plaintiff award made by the court.

D. Operating procedure

1. Notice

Notify the ROof the State's intentions and provide a written rationale as soon as possible and prior to the settlement being finalizedif Federal payment is desired.

2. Approval

Receive RO agreementregarding the appropriateness and reasonableness of such costs prior to incurringcost for legal fees and settlement costs that will be charged against Federal funds.

NOTE:The RO will determine, on a case-by-case basis, if the legal fees and settlement costs are allowable, before the State incurs any costs that will be charged against Federal funds.

3. Justification

Justifythe settlement decision.

4. Rationale

The State's rationale must demonstrate and justify that:

a. Reasonable business decision

The decision was entered into on the basis of a reasonable business decision to settle the controversy at a minimum cost,rather than incur the relatively expensive cost of litigation.

b. Advantages of settlement

The advantages of settlementare thought to outweigh the advantages of proceedingwith the lawsuit.

NOTE:The RO will give consideration to the time and resources needed to defend a protracted lawsuitand the prospect of unfavorable publicityupon the disability program.

c. Absence of Federal funds

The case would have been similarly settled absent Federal funds.

d. Cost effectiveness

The entire costof the proposed settlement is less than the legal feesthat would be incurred by pursuing the case to a finding of no discrimination.

5. Calculating costs

Settlement vs. Proceeding

The State will justify this decision by showing both the costs and the advantages of the alternatives as follows:

  1. a. 

    Calculate the cost of legal charges and settlement feesfor the proposed out-of-court settlement.

  2. b. 

    Estimate the cost of the legal feesif the case were to be taken to a court settlement.

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DI 39518.025 - Equal Employment Opportunity -- DDS - 08/05/1996
Batch run: 04/01/2013