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OFCCP Settles Hiring and Pay Discrimination Allegations with G&K Services for Nearly $290,000

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G&K Services

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.

Disclaimer. This article and the related links and attachments are provided for informational purposes only to review some recent developments which may be of interest. They are not intended as and do not constitute legal advice or opinions of FISHER & PHILLIPS LLP or any of its attorneys, and should not be acted on as such. Further, the materials are not represented as being all-inclusive or complete, or up-to-date. The information contained herein is abridged from legislation, court decisions, administrative rulings, and other information and materials provided by the U. S. Department of Labor and should not be construed as legal advice or opinion, and is not a substitute for the advice of counsel. You should not act or rely on any legal information and links in this article without obtaining the advice of an attorney.

The posting and distribution of this article and its links are not intended to create, nor do they create, an attorney-client relationship between FISHER & PHILLIPS LLP and you or any other person.

Reproduction. This is a copyright publication. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or any information storage system, without written permission.

This article was prepared expressly for OutSolve, LLC by:

Celia M. Joseph, Esquire

FISHER & PHILLIPS LLP

201 King of Prussia Road

Suite 650

Radnor, PA 19087

cjoseph@laborlawyers.com

Copyright 2013 FISHER & PHILLIPS LLP. All Rights Reserved.

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