they took out federal taxes on the settlement but did not send a W2 to the complainant?
Employment / Labor Attorney
That would be a stretch. The standard for retaliation in EEOC cases is whether the conduct would have dissuaded a reasonably employee from engaging in protected conduct. It's hard to see how failing to send the employee a W-2 would ever meet that standard, given that the IRS has procedures for dealing with employers who fail to send out W-2s and 1099s.
But sure, I suppose an employee could file a charge of discrimination asserting that theory. Frankly, I've seen worse.