Summary of Article. On November 4, 2013, the U.S. Department of Labor ("DOL") announced that Federal contractor G&K Services Co. ("G&K Services") entered into a conciliation agreement with the DOL's Office of Federal Contract Compliance Programs ("OFCCP") for nearly $290,000 to settle hiring gender bias and pay discrimination allegations. The OFCCP stated that it had determined that G&K Services, in its Santa Fe Springs, California location, discriminated against: 1) female laundry workers by steering them into lower-paying positions regardless of their qualifications; and 2) male applicants in the company's hiring process by only considering the male applicants for "heavy duty" work.
Background of the Case. G&K Services provides textile leasing and renting services to several different government agencies, including the National Aeronautics and Space Administration, the Defense Commissary Agency, and the Bureau of Reclamation. During an OFCCP compliance evaluation, the agency concluded that between July 1, 2009, and June 30, 2010, G&K Services had a practice of assigning different tasks and different pay rates to laundry workers on the basis of gender. The agency found that female employees hired as general laborers were assigned to "light duty" jobs that paid less than "heavy duty" jobs involving similar work and qualifications which G&K Services reserved for male employees. In its press release regarding this case, the DOL stated that denying women access to higher-paying opportunities because of sex stereotyping is a form of pay discrimination in violation of Executive Order 11246. OFCCP compliance officers also determined that male applicants for the G&K Services positions were frequently denied the option of competing for a majority of the open laborer opportunities during the review period in question because the company only considered the male employees for so-called "heavy duty" work.
Conciliation Agreement. G&K Services agreed under the terms of the conciliation agreement that it would: 1) pay $265,983 in back wages to 59 female workers who were steered into the lower paying jobs; 2) extend to the 59 female class members job offers in the higher-paying laborer positions; 3) pay $23,968 in back wages to 331 male job applicants who were denied the opportunity to compete for open lower-paying laborer positions, and make three job offers; 4) undertake extensive self-monitoring measures; and 5) review and revise its hiring and pay practices to ensure the company fully complies with the law.
Regarding this settlement, OFCCP Director Patricia A. Shiu stated, "[t]he settlement reflects a mutual commitment between the department and the leadership of G&K Services Co. to ensure that qualified workers, irrespective of gender, have a fair shot at competing for good jobs. I am pleased by this contractor's willingness to work with us on a proactive strategy to guarantee that all their workers have an equal opportunity to succeed in the workplace."
Observations. This allegations made by the OFCCP in this case generally pertain to hiring and pay equity concerns the agency has frequently mentioned pertaining to its understanding that employers sometimes steer job applicants and/or employees into jobs, including lower-paying jobs, due to their race, national origin or gender. Federal contractors and subcontractors should monitor their job selection and hiring processes to ensure they carefully review any practice that could possibly place applicants or employees in positions due to race, national origin, or gender.
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This article was prepared expressly for OutSolve, LLC by:
Celia M. Joseph, Esquire
FISHER & PHILLIPS LLP
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