Learning & Development

Enforcement of Pay Discrimination Claims Still High

Last year, the Office of Federal Contract Compliance Programs (OFCCP) announced a number of settlements in enforcement cases against federal government contractors demonstrating a continued emphasis on pursuing systemic hiring and pay discrimination claims.

Settlement costs ranged from $165,000 to $1.8 million and required the affected contractors to take action in hiring and promoting as reparations for those alleged violations.

‘Steering’ Costs Contractor $1.8 Million

In its case against G&K Services, a uniform and facility services products provider, the OFCCP reached a settlement of what the agency alleged to be systemic hiring and pay discrimination violations identified in compliance evaluations initiated between 2011 and 2015.
The agency’s investigations indicated that the contractor discriminated against 444 female employees in laborer positions by engaging in so-called “steering” by disproportionately assigning them to lower-paying job duties while filling the higher-paying job duties predominantly with men even though female employees were qualified for, and able to perform, the higher-paying jobs.
The OFCCP determined that this practice of steering women into the lower-paying, “light-duty” jobs led to unlawful, sex-based pay discrimination at G&K facilities in Denver, Colorado; Sacramento, California; Graham and Charlotte, North Carolina; Pleasant Hill, Iowa; Justice, Illinois; St. Paul, Minnesota; and Houston and Coppell, Texas.
This practice also resulted in a lower hiring rate for 2,327 male applicants who were equally or more qualified for general laborer positions at the Sacramento, Pleasant Hill, Justice, St. Paul, and Coppell locations. The OFCCP also found that G&K failed to provide equal opportunity to 456 African-American and 111 Caucasian applicants at its Houston and Charlotte locations when hiring for general laborer positions.
In the settlement, the contractor denied liability but agreed to pay a total of $1,813,555 to members of the affected classes and to extend 78 job opportunities to the male, black, and white applicants who were not hired and 58 opportunities for female employees to move into higher-paying positions.
In addition, the settlement required the contractor to undertake a detailed assessment of its hiring, placement, and compensation practices, and its job postings and other documents to ensure it provided equal opportunity and did not discriminate on the basis of sex or race.
Finally, the settlement requires the contractor to conduct regular adverse impact and compensation analyses at the locations where the OFCCP found alleged violations and to report regularly to the agency during the monitoring period on its fulfillment of these obligations.

Discrimination Finding in Hiring Costs Contractor

In another settlement announced by the OFCCP, federal contractor Aramark Educational Services, LLC, agreed to pay $165,000 in back wages, interest, and benefits to 335 male and African-American applicants to remedy alleged hiring discrimination for food service positions at its Lubbock, Texas location.
In a press release announcing the settlement, OFCCP Director Patricia Shiu stated, “There are no such things as ‘women’s work’ and ‘men’s work.’ There is only work, and federal contractors are well aware of their obligation to provide equal opportunities to all employees and job applicants.”
Shiu adds, “This settlement is a reminder that it is up to the employee or job applicant to decide which positions to pursue, whatever their reasons. A contractor may only evaluate whether or not an individual has the ability to do the job.”
In addition to paying monetary damages, the contractor agreed to offer jobs to 53 original applicants as positions become available, and it will review and revise its selection process and provide training to its hiring managers to eliminate practices that result in gender and race stereotyping.
Tomorrow we’ll look at a another example of a settlement.