A Minnesota company ended a new employee’s employment within weeks of hiring. Days later, the employee filed a charge of discrimination and retaliation with a government agency, and the employee’s lawyer later demanded a substantial payment. The case ended about two years after it began: the employee agreed to dismiss the claims with prejudice, and the company paid nothing.

What Should a Company Do When a Discrimination Charge Arrives?

I started by interviewing the company’s witnesses before writing anything to the agency. I then filed a position statement built on the company’s records and those accounts, answered each amended version of the charge, and produced the documents the agency requested. I also recommended that the company submit the claim to its employment practices liability insurer promptly, because the policy might cover the claim and the legal fees.

Should the Company Mediate at the Agency?

The company chose to decline mediation, both when the agency offered it and when the employee proposed it. When the agency asked to visit the workplace and interview employees, I negotiated the terms of the visit and met with the employees first. The agency later closed its file at the employee’s request so the employee could sue. The agency did not decide the charge either way.

What Changes Once the Employee Sues?

I answered the complaint with specific denials, exchanged the disclosures the court rules require, and responded to the employee’s discovery. When the employee lowered the settlement demand, the company declined again. I then served written discovery on the employee: requests to admit facts, requests to produce documents, and written questions to be answered under oath.

How Did It End?

About two weeks after that discovery was served, the employee’s lawyer agreed to dismiss. The parties signed a settlement agreement under which the employee dismissed the claims with prejudice, and the company made no payment.

What Can an Employer Take From This?

  • The first response sets the record. What a company tells the agency at the start is the account it will stand behind if the employee later sues, so the response is worth getting right, and on time: under Minn. Stat. § 363A.28, subd. 1, a company that misses the Minnesota Department of Human Rights response deadline can face a default action.
  • A demand is an opening position. A company with documented reasons and consistent witness accounts can decline to pay it.
  • Check the insurance. If the company carries an employment practices liability policy, it is worth checking the day a charge arrives, because the policy may pay for the defense.

My guides on EEOC charges against employers, how employment practices liability insurance works, and defending wrongful termination claims cover the rules behind this story.

Identifying details are omitted to protect client confidentiality. Past results do not predict future results; every matter turns on its own facts and law.