Employment lawsuits are an issue businesses should take seriously as nothing good can ever come out of them. Not only do they cost an employer a lot of money when a case goes to trial, but they also tend to damage the business’s reputation.
Therefore, employers must strive to eliminate the possibility of lawsuits or, at the very least, reduce cases as much as possible. The first step to eliminate the problem is to understand its nature.
This is where employee lawsuit statistics play an essential role, so let’s look at some of the most impressive ones.
Interesting Statistics on Employment Discrimination (Editor's Pick)
- 61% of employees say they have either witnessed or experienced discrimination at work.
- African Americans filed 26% of total workplace discrimination charges.
- 75% of workplace harassment victims experience retaliation.
- Lawsuits against employers due to discrimination have risen 400%.
- Every year, businesses earning $1 million spend $20,000 on lawsuits.
Employment Lawsuits Statistics
1. 61% of employees say they have either witnessed or experienced discrimination at work.
According to workplace discrimination statistics from four different countries, 61% of US respondents have said that, at some point, they've either experienced or witnessed discrimination based on age, race, religion, or gender. That's three out of five US employees.
These lawsuit statistics by state also show that the US percentage is the highest among all four nations in the study, namely the US, Germany, the UK, and France.
2. 53.8% of workplace discrimination charges concern retaliation.
In 2019, more than half of all cases filed with the EEOC concerned retaliation. With as much as 39,110 charges, retaliation made up for 53.8% of all cases filed. This shouldn't come as a surprise since retaliation has been taking up the top spot in employment lawsuits statistics for over a decade, even though most of us aren't acquainted with retaliation as we're focusing more on racial and sexual discrimination instead.
3. Disability discrimination accounts for 33.4% of cases filed with the EEOC.
Federal law requires employers to be unbiased during hiring, promotion, and job assignment processes. Employers must take specific measures to accommodate disabled employees unless doing so would create a financial strain on the employer.
The purpose of this law is to reduce disability discrimination in the workplace. Despite creating this federal law, though, the EEOC statistics tell us that disability discrimination is still a huge problem since it comprises one-third of all workplace discrimination cases.
4. Racial discrimination in the workplace statistics record 23,976 cases in 2019.
Inequality based on race and ethnicity is probably one of the most known types of workplace discrimination. Sadly, instances of injustice due to skin color are abundant.
You’d think that all the attention and bad publicity employers get from this kind of lawsuit would discourage bosses, managers, and co-workers from discriminating against people of color, but statistics say otherwise. The EEOC has reported that complaints on ethnic biases take up 33% of all filed charges.
5. African Americans filed 26% of workplace discrimination charges.
Some discrimination charge statistics can be disheartening for minority groups, as there's a long way to go in the nation’s fight against racial discrimination.
When we look at the percentage of African Americans in the US workforce, we know that they belong to the minority. African Americans take up 13% of the US workforce population, yet 26% of workplace discrimination charges are against African Americans.
6. The EEOC lawsuit success rate for racial discrimination charges is at 15%.
The EEOC reported that racial discrimination cases have low success rates. As a matter of fact, this type of employment discrimination holds the spot for the lowest success rate of all discrimination cases. The EEOC attributes this poor performance to the fact that the agency is understaffed, so it’s difficult to investigate each case thoroughly. However, the EEOC’s justification is yet to be evaluated.
7. 92% of women say they've experienced gender harassment.
In 2016, 76% of women said they were harassed in the workplace. After the awareness that the #MeToo movement has brought to the world, people assumed the percentage of harassment lawsuits against employers would drop. While that might be true for sexual coercion, which dropped from 25% in 2016 to 16% in 2018, hostility towards women increased all the more.
8. Of the 72,675 complaints filed with the EEOC, 32.4% were against sex-based discrimination.
Despite the #MeToo movement's growing popularity, only 20% of employers have taken measures to avoid sexual harassment in the workplace by conducting training and creating new policies. This inadequate response to the sexual harassment problem reflects the percentage of sex-based discrimination cases filed with the EEOC, which is 32.4%, according to job discrimination employee lawsuit statistics.
9. 75% of workplace harassment victims experience retaliation.
The EEOC estimates that as much as 75% of harassment cases experience retaliation after reporting the incident. This is an alarming figure, even if it's just an estimate, as it reflects an environment where employees feel unsafe to report workplace discrimination and harassment.
10. 20% of the LGBT community experienced discrimination when they applied for jobs.
Five years ago, there were no laws in place to protect people belonging to the LGBT community. This made them susceptible to discrimination and unfair treatment in the workplace.
However, in July 2015, the EEOC ruled that sexual orientation discrimination is covered under Title VII of the Civil Rights Act of 1964. The resolution, however, doesn't guarantee the abolition of discrimination against people with different sexual orientation. Workplace discrimination statistics for the LGBT community state that 20% still experienced discrimination when applying for jobs.
11. 66% of Fortune 500 companies offered domestic partner benefits.
Before the Obergefell decision on June 26, 2015, some employers already offered their gay employees benefits for their domestic partners that equaled those received by employees married to the opposite sex.
Following the Obergefell decision for allowing same-sex marriage, the EEOC ruled that equality in employee fringe benefits should be exercised among all types of marriages.
12. 36% of US workers feel their age prevents them from getting hired.
More than one-third of US employees who are over 40 years old feel that their age was a significant barrier to getting a job. There is truth to this figure since the EEOC complaint statistics have reported that age discrimination remains one of the top five cases filed with their agency at a disheartening 21.4%.
13. Approximately 21% of the US workforce experienced age discrimination.
One out of five workers declared they've experienced age discrimination at some point in their careers and more than one-quarter of workers are anxious that they will lose their jobs due to ageism.
Even though ageism doesn't receive as much attention as sexual harassment or racial discrimination, age-related employment discrimination statistics show that ageism is indeed a growing problem. The number of cases filed from 1990 to 2017 has doubled. The public's seeming apathetic response to the problem may be partly to blame as more than half of eyewitnesses don't report incidents of age discrimination to the proper channels.
14. 82% of closed cases in the EEOC did not receive any relief.
The EEOC claims statistics seem to be disheartening for the US workforce. From 2010 to 2017, more than one million cases have been filed with the EEOC, out of which a staggering number of 930,000 closed, with only a dismal 18% receiving any sort of relief.
15. The EEOC staff decreased by 39% in 2017.
The problem with low relief rates is primarily due to the reduced number of EEOC employees. EEOC staff numbers declined by 39% from 1980 to 2017.
The EEOC claims statistics paint a clear picture of how overwhelming this situation can get for the agency. In 1980, the US workers to EEOC staff members ratio was 32,000 to one. Fast forward to 2017, and it's 77,000 to one. That's more than double the ratio from 37 years ago. Therefore, it's no wonder why so many EEOC cases didn’t receive any relief.
16. The EEOC reported a 12.1% reduction in their inventory of cases.
It's not all bad news with the EEOC, though. In 2019, the agency reported that they were able to reduce pending cases by 12.1%. Many of these cases had been filed several years ago and had remained dormant for quite some time.
The EEOC still has a long way to go since they have 43,580 pending cases. However, that figure is the lowest they've had in 13 years.
17. Employee lawsuit statistics show that 25% of discrimination inquiries translated to formal charges.
In the fiscal year 2019, the EEOC addressed 123,000 discrimination-related inquiries through what they call the pre-charge counseling. Of this number, only 31,000 translated to legal cases. The EEOC believes that employees are now making better and more informed decisions about situations involving possible discrimination cases before filing harassment lawsuits against employers.
18. 2% of the cases filed were investigated and found that discrimination did happen.
The EEOC was able to investigate 2% of the discrimination cases filed. Although they confirmed that discrimination in the workplace did happen, half of those cases didn't receive any relief, whether monetary or any other form.
19. 18% of cases filed with the EEOC received some form of relief.
Of all employees that filed a case with the EEOC, employee lawsuit statistics show that only 18% received some amelioration, either monetary or in the form of job accommodations. The two parties involved usually settled most of these cases through mediation. In other words, before the cases could progress, and the EEOC could reach a conclusion, a settlement was the most common outcome.
20. Texas has the largest number of workplace discrimination cases according to EEOC statistics by state.
As with the previous two fiscal years, 2017 and 2018, Texas remains the state with the most discrimination cases at 10.2%, followed by Florida at 8.2%. Most would attribute this to the states' dense population, but an in-depth study must be made to reach such a conclusion.
Employment Lawsuit Costs
21. Lawsuits have risen 400% in just 20 years.
In 20 years, employee lawsuits and termination lawsuits have increased by 400% and 260%, respectively. The jump is so astounding it's said that businesses now are three times more likely to get sued by their employees than to experience a fire at the office.
22. 41.5% of lawsuits are against small businesses.
Some multi-million companies have insurance coverage through EPLI. When a business gets slapped by an employment lawsuit, EPLI is there to cushion the blow. Unfortunately, that’s not the case for all businesses. According to small business lawsuit statistics, approximately 70% of employers don't have EPLI up their sleeves. If the business carries a lot of cash, the defense cost shouldn't be a problem. However, this is rarely the case for small businesses.
23. A workplace discrimination case can cost an employer $200,000 if it goes to trial.
2019 EPLI claims statistics show that most businesses don't see why they should protect themselves via EPLI from the possibility of employees filing lawsuits. This could be a huge mistake. If an employee files a discrimination charge against an employer, and the case goes to trial, it could cost the business from $150,000 to $200,000. For a small business, that amount could potentially cripple its operations.
24. The cost of an employment lawsuit has risen by 26%.
The cost of a lawsuit filed against a business is not the same as it was decades ago. To be precise, it has risen by 26% in the last three years. If this trend continues, lawsuits can become too costly for employers, thus detrimental to businesses.
25. Lawsuit resolution can take up to 24 months.
The lawsuit cost isn't the only problem employers need to face when employees file charges against them. Lawsuit cases can drag on for months, sometimes years. On average, a resolution can be reached after 18 to 24 months. A case that drags on this long could be a source of bad publicity for the business.
26. Small business lawsuit statistics show that small enterprises pay, on average, $20 million out of pocket every year in tort.
Statistics about employee lawsuits reveal that small enterprises end up paying $20 million from their pockets due to liabilities from lawsuits. These staggering amounts employers pay using their funds reflect businesses' reluctance to buy lawsuit coverage through EPLI.
27. Every year, businesses earning $1 million spend $20,000 on lawsuits.
Every year, small enterprises that earn $1 million spend 2% of their income on lawsuits. What they're unaware of is that, with only one-fourth of that cost per year, they'd be able to protect their businesses against lawsuits filed by their employees through EPLI.
28. An out of court settlement costs about $75,000.
On average, out of court settlements cost businesses $75,000 each. Most employers decide to settle cases filed by employees against them out of court. One of the reasons for this decision is to reduce the risk of paying more money should the case go to trial.
29. 42% of businesses are not willing to pay for EPLI insurance cost.
Almost half of businesses think they don't need EPLI. It's not because they think protection against a lawsuit is unnecessary; it's because most businesses believe they already have coverage; therefore EPLI might be redundant. However, this erroneous assumption could cost businesses hundreds of thousands of dollars.
30. Fortune 500 companies spent $2 billion in settlements.
Fortune 500 companies spent an estimated amount of $2 billion in settlements alone. This figure is likely to be higher in reality since some compensations were not disclosed due to confidentiality clauses. The figure also doesn't take into account the settlement costs incurred by small businesses.
Conclusion
Employment lawsuits have been a lingering problem not just for employees and employers, but also for the EEOC. Specific state laws and federal laws focused on workplace discrimination should have lowered the number of cases filed. But that’s not the case as we’ve seen in these interesting EEOC lawsuits statistics.
Employment lawsuits could drag on for a long time and can have severe repercussions on an employee's psychological state, not to mention the impact on the employee's career. An employee also needs to spend a lot of money on good counsel. This is the reason why employees demand high amounts of settlement.
Also, employment lawsuits are harmful to employers. Even if the case concludes in favor of the employer, the charges can negatively affect the business's reputation. Furthermore, the average cost to defend an employment lawsuit could stretch finances and bring the business down. However, an employer can do a couple of things to avoid damages caused by an employment lawsuit.
First, employers should create an environment wherein discrimination isn't tolerated. The message should be clear to all employees, from executives down to rank-and-file employees. It would also prove beneficial if the company adopted policies that promote equality and punish discrimination severely.
Second, it would be wise for employers to seek lawsuit coverage through EPLI. As we have seen in several employee lawsuit statistics, misinformation could prove to be costly. The EPLI coverage cost is but a fraction of potential settlement costs. After all, it makes sense to protect a business through EPLI since statistics on discrimination in the workplace tell us that an employment lawsuit is thrice more likely to happen than for an office to burn down.
