On July 2, 1964, President Lyndon B. Johnson signed the landmark Civil Rights Act of 1964, which banned discrimination based on race, color, religion, sex or national origin. In particular, Title VII of the Act, which focused on discrimination by employers with at least 15 employees, provided workers with new ammunition in the fight against discriminatory companies and policies. President Johnson said the Act would help “eliminate the last vestiges of injustice in our beloved country.”

But as it turns out, there was still more work to be done. Today’s in-house counsel aren’t dealing with their parents’ Title VII.

Whether through Supreme Court decisions, expansions and amendments to the law, or shifting Equal Employment Opportunity Commission (EEOC) and plaintiff’s bar priorities, Title VII investigations and litigation have changed mightily since the enactment of the Act 50 years ago. According to Natalie A. Pierce, shareholder at Littler Mendelson, the law’s scope has expanded far past its original reach.

“You have to remember that when President Johnson signed Title VII into law in 1964, the protected categories were race, color, religion and national origin,” Pierce says. “Since then, what we’ve seen is this evolution of the law and the addition of new protected categories. Now, our country’s discrimination laws include prohibitions of employment discrimination based on age and pregnancy, disability and genetic status.”

For in-house counsel, this means not only increased risk in the labor and employment arena, but also an evolving law with the potential to add new areas of risk in the future.

Class in session

Many of the original cases under Title VII involved individuals looking for fair treatment from their employers. However, through the years, one of the main changes to the law has occurred with the rise of class action cases, which the EEOC says comprise roughly 25 percent of its docket today.

According to Pierce, one of the key reasons for these changes can be traced to the U.S. Supreme Court’s decision in General Telephone Co. v. EEOC, which allowed the EEOC to seek class-wide relief without being certified as the class representative.

“The Court held that the requirement under Rule 23 of the F.R.C.P. (Federal Rules of Civil Procedure) does not apply to the EEOC. It makes it a lot easier for them to file class-type discrimination claims against employers,” Pierce says. “The General Telephone case was really a big deal in that it allowed the EEOC to go further than private litigants.”

But that’s not to say that private litigants are left off the class litigation bandwagon. Michael S. Burkhardt, partner at Morgan, Lewis and Bockius, traces the plaintiff’s bar’s interest in Title VII class litigation to the Civil Rights Act of 1991. That piece of legislation allowed for the possibility of compensatory and punitive damages in discrimination cases,as well as the right to a jury trial.

“Prior to 1991, there was lots of Title VII litigation, and you had occasional EEOC litigation. But they were all non-jury cases, and the damages were back pay,” Burkhardt says. “The reality is, once the statute was amended, and you added the compensatory and punitive damage aspect of the claims, the risk profile for companies got much higher.”

As a result of this increase in class action cases, the EEOC is raking in more money from Title VII suits than ever before. According to statistics released by the Commission, the EEOC finished the 2013 fiscal year with $255.9 million in monetary benefits from Title VII cases, just below 2012′s record high of $258.6 million and an 84 percent increase over the monetary benefits tallied in 2003.

The big data dilemma

Data has always been an integral part of Title VII litigation; at its essence, proving discrimination or non-discrimination is a numbers game. However, as data collection techniques have recently become more sophisticated, Title VII litigation has grown in kind. Burkhardt says a growing reliance on statistical analysis has helped lead to some of the bigger class action cases in recent years.

“That lynchpin of statistical evidence is critical in so many of these cases and becomes the means by which the plaintiff’s bar has tried to advance class claims for a lot of years,” Burkhardt says. “Companies that want to evaluate their risk, to get in front of that risk from a class perspective, conduct robust statistical analysis of their decision-making.”

And what’s the best way to conduct that analysis? It’s all about analyzing the correct data, which may not be the standard HR data that many in-house lawyers may turn to first.

“If you’re conducting analysis for the purpose of obtaining legal advice, that’s different than the business purpose that an human resources or diversity department may have in running an internal analysis,” Burkhardt says. “Obviously, there’s a balance, because companies will do both. It’s really about trying to understand what’s the best way to analyze data.”

Counsel that conduct the analysis correctly, though, may receive a significant leg up on the competition. Pierce notes that in-house counsel have been able to beat the EEOC at its own game through strong statistical analysis.

“It becomes this battle of the experts, and the EEOC has been getting dinged over that,” Pierce says. “The agency has paid out some pretty hefty fees and awards in instances where the courts have found that companies demonstrated through the use of analytic tools that the alleged unlawful practice is simply not going on. That is all the more reason why you have to do these audits.”

Collaborating with the Commission

Just because data collection techniques are the same, though, doesn’t mean that all lawsuits will be. According to Douglas J. Farmer, a shareholder with Ogletree Deakins LLP who previously worked four years with the EEOC, the first task is realizing exactly where that challenge is coming from.

“The most important thing that in-house counsel need to understand is that the EEOC is not a business—it is a government entity,” Farmer says. “It is not a law firm, and thus, there isn’t necessarily the same incentive that is in place as dealing with a plaintiff’s lawyer to resolve a case quickly, or to a resolve a case for anything other than full relief.”

The easiest way to avoid risk in today’s market, Farmer says, is to distill the law’s complex minutiae for a non-legal audience.

“I generally found that the more adept an in-house counsel was at taking all of this complicated law and turning it into very practical steps that management could understand and implement were the best off,” Farmer says. He adds that, because of the complexity of today’s labor and employment laws, preventative action rather than reactionary action is a tough skill to cultivate, but it’s one that could pay dividends for companies.

Pierce says the EEOC is taking a narrower view of litigation, but systemic investigations could lead to trouble down the road. For now, the best option for in-house counsel may be to take caution with these cases, especially as Title VII has not yet stopped evolving.

“Remember that the EEOC has significant prosecutorial discretion, so you may want to do more to partner with them and come to some sort of conciliation,” Pierce says. “The EEOC is taking fewer cases, but they’re taking a very strong approach to those cases.”