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Expert: $6.5M in back pay owed in Baltimore Co. pension lawsuit

Baltimore County may owe more than $6 million plus interest to older employees in an age discrimination case affecting roughly 12,000 people who were improperly overcharged for their contributions to the county’s pension system.

An expert for the Equal Employment Opportunity Commission calculated the damages in a document provided to the county on Jan. 21, according to a letter the county wrote to U.S. District Court Judge Richard D. Bennett on Friday. While the expert found that the damages were as high as $6.5 million plus $2.6 million in owed interest, the county argues in the letter that “the expert report is the first time that the EEOC has asserted its entitlement to owed interest.”

The county has not yet filed its own calculation of damages.

The county and the EEOC have been in litigation for more than a decade over a previous pension system that had a higher contribution rate for employees over age 40. The county changed its policy for new hires in 2007 and the parties and unions agreed to a plan in 2016 that gradually equalized contribution rates.

The EEOC then pursued back-pay damages for the affected employees and the 4th U.S. Circuit Court of Appeals ruled in 2018 that back pay was mandatory under the Age Discrimination in Employment Act.

In Friday’s letter, the county argued that the attempt to claim interest is in conflict with prior statements by the EEOC that it recognizes a sizable damage award could hurt innocent third parties — taxpayers and current and retired employees — and that the EEOC “has no desire to inflict such hardship on Defendant, its residents or its employees.”

The EEOC responded Monday that it “asserted a claim to prejudgment interest” in an early filing and then reiterated it in 2016.

“A request for prejudgment interest is standard in all EEOC cases involving a claim for back pay,” the letter states. “EEOC has never disavowed its claim for prejudgment interest in this case.”

The parties most recently squared off over the size of the class entitled to damages in the case. The EEOC prevailed, establishing that it can seek relief for some 12,000 pension beneficiaries.

Bennett ruled in October that the EEOC can pursue relief that accrued between March 6, 2006, and April 26, 2016, the date when the court approved the plan to gradually equalize contribution rates, but he will allow the commission to argue for back pay through the end of 2018 if evidence supports it later.

In Monday’s letter to the court, the EEOC alluded to the past disputes and suggested that the issue of prejudgment interest “is not ripe for resolution.”

“Given the frequency and volume of Defendant’s attempts to limit its liability for its unlawful conduct, it serves judicial economy and conserves the parties’ resources to handle all such remaining disputes at the same time,” attorneys said.

The parties are exchanging discovery until April and the calculation of back pay may be referred to a special master, according to the EEOC’s letter.

The case is Equal Employment Opportunity Commission v. Baltimore County, 1:07-cv-02500.

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