Tag Archives: ALJ

OFCCP Concedes ALJ Ruling that “Non-Asian” Is Not a Proper Class

The Office of Federal Contract Compliance Programs (“OFCCP”) filed a notice on September 19, 2013 with the Department of Labor’s Administrative Review Board (“ARB”) indicating that it will not appeal the Administrative Law Judge’s (“ALJ’s”) ruling in OFCCP v VF Jeanswear Ltd Partnership, (ALJ Case No 2011-OFC-00006, Krantz, K), that “non-Asian” does not constitute a “race” for the purposes of Executive Order 11246 enforcement.

ALJ Ruling

On August 5, 2013, the ALJ ruled that OFCCP could not pursue a finding of discrimination against a contractor on behalf of “non-Asians.”  In that case, OFCCP alleged that VF Jeansware discriminated against 288 “non-Asian” applicants for positions in its Operative job group at its Winston-Salem, North Carolina establishment.   OFCCP alleged there was statistically significant adverse impact against “non-Asians” based on VF Jeansware hiring only sixteen percent of the incumbents for Operative positions from its non-Asian applicant pool as compared to hiring nearly forty-four percent of the Asian applicant pool for positions in that same job group. 

Upon review, the ALJ held that OFCCP could not establish a discrimination claim against “non-Asians” because “non-Asians” were not a protected class.  Although the ALJ acknowledged there was disparate impact on “non-Asians”, he found that “non-Asian” is not a term defined in the regulations and was an aggregate of three ethnic groups (i.e., Whites, African-Americans, and Hispanics).  The ALJ noted that while Whites were underrepresented, African Americans were close to the percentage of African-Americans available in the regional data and Hispanics were actually “overrepresented.”  The ALJ also explained that the only accepted “race” and “ethnic group” classifications for both EEOC and OFCCP purposes are African-American, Native American/Alaskan Native, Asian/Pacific Islander, Hispanic, and White.  Although “non-whites” can constitute a protected class of “minorities”, the regulations do not recognize other “non-” classifications for the purposes of analysis and enforcement. 

OFCCP had thirty days to appeal the ALJ’s ruling to the ARB.  OFCCP filed a notice with the ARB on September 19, 2013 waiving its right to appeal the ALJ’s ruling, and, on September 25, 2013, the ARB issued an order closing the case.

Impact of Ruling

Over the last several years, OFCCP has moved away from conducting adverse impact and disparity analyses at the aggregate level of comparing minorities to non-minorities (i.e., White).  Instead, OFCCP has increasingly been comparing sub-minority and ethnic groups to find cases of disparate impact.  In some instances, such as the VF Jeanswear case, OFCCP has been aggregating certain ethnic and minority groups to increase their odds of finding disparate impact.  Many in the contractor community believed that this type of analysis was unsound and unsupported by the Title VII principles that apply to OFCCP discrimination cases.

The ALJ’s ruling along with OFCCP’s decision not to challenge it emphasizes that OFCCP cannot base discrimination claims on these aggregate ethnic and racial groups.  Contractors, however, should still be prepared during audits for OFCCP to analyze their selection decisions by comparing the highest group selected against each sub-minority or ethnic group that was not selected.

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Filed under ALJ, ARB, Department of Labor, Discrimination, OFCCP

Administrative Review Board Finds That Participation in TRICARE Did Not Subject Florida Hospital to OFCCP’s Jurisdiction

On October 19, 2012, the Department of Labor’s Administrative Review Board (“ARB”) found in OFCCP v. Florida Hospital of Orlando that the OFCCP did not have jurisdiction over a federal contractor based solely on its participation in TRICARE. The ARB, however, left open whether other healthcare contractors participating in TRICARE would be subject to OFCCP’s jurisdiction.

Background

TRICARE is a program sponsored by the Department of Defense (“DoD”) that pays for medical benefits for active and retired military personnel and their families. There are three prime contractors that administer the TRICARE program. These three contractors enter into subcontracts with hospitals and medical providers to provide medical care and supplies to TRICARE participants. Florida Hospital held a subcontract with one of the TRICARE prime contractors.

In August 2007, OFCCP scheduled Florida Hospital’s Orlando establishment for a compliance review. Florida Hospital refused to submit to OFCCP’s compliance review, asserting that it was not subject to OFCCP’s jurisdiction. OFCCP initiated enforcement proceedings arguing that Florida Hospital’s participation in TRICARE subjected it to OFCCP jurisdiction.

On October 18, 2010, an Administrative Law Judge (“ALJ”) found that Florida Hospital was a federal subcontractor because it assumed the performance of the TRICARE prime contractor’s obligation to the federal government. The ALJ also rejected Florida Hospital’s argument that TRICARE payments did not subject it to OFCCP’s jurisdiction because it was federal financial assistance. Florida Hospital appealed the decision to the ARB.

While the decision was pending appeal, on December 31, 2011, the National Defense Authorization Action for Fiscal Year 2012 (“NDAA”) was signed into law. The NDAA expressly stated that medical providers who participated in TRICARE were exempt from OFCCP’s jurisdiction.

ARB’s Decision

The ARB reviewed the NDAA exemption and held that OFCCP lacked jurisdiction over Florida Hospital because it met the specific language in the NDAA exemption. The ARB, however, found that the exemption was narrow and would only exempt TRICARE contractors that require establishment and management of a network of providers. The ARB indicated that it would review OFCCP’s jurisdiction over other TRICARE subcontractors on a “case by case” basis.

Because the ARB has left open the possibility that some TRICARE subcontractors may be covered by OFCCP’s jurisdiction, healthcare contractors must closely scrutinize their participation in TRICARE to see if they are subject to OFCCP’s jurisdiction.

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Filed under Department of Labor, OFCCP

ARB Overturns Favorable Decision for Contractors

On May 8, 2012, the Administrative Review Board for the Department of Labor (“ARB”) reversed a very favorable ruling for contractors, holding that the Office of Federal Contract Compliance Programs (“OFCCP”) could request data from contractors during desk audits concerning hiring, terminations and promotions after the period covered by OFCCP’s initial Scheduling Letter. 

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Filed under Affirmative Action Plan (AAP), Department of Labor, Discrimination, EEO, OFCCP

Federal District Court Hears Oral Argument in United Space Alliance, LLC v. Solis, et al

On October 27, 2011, United Space Alliance, LLC (“USA”), the government’s primary contractor for manned space missions, argued to Judge Royce C. Lamberth, the Chief Judge for the Federal District Court for the District of Columbia, that the Office of Federal Contract Compliance Programs’ (“OFCCP’s”) request for compensation data for periods beyond its initial scheduling letter violated the Administrative Procedures Act (“APA”) and the Fourth Amendment.  Continue reading

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Filed under Affirmative Action Plan (AAP), Compensation, Department of Labor, Discrimination, Executive Order, OFCCP

Administrative Judge Finds Contractor Could Not Argue OFCCP Lacked Jurisdiction Over Data It Voluntarily Delivered to OFCCP

On September 19, 2011, Administrative Law Judge (“ALJ”) Stephen Purcell held in OFCCP v. Nash Finch Co., ALJ Case No. 2011-OFC-00004, that OFCCP could undertake enforcement actions based on data the contractor voluntarily delivered to OFCCP that was initially outside of OFCCP’s jurisdiction Continue reading

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Filed under Affirmative Action Plan (AAP), Department of Labor, Discrimination, EEO, Executive Order, OFCCP, Uncategorized

Contractor Agrees to Be Debarred Rather than Consent to OFCCP Jurisdiction

In an unlikely move, Manheim Government Services, LLC (“MAG”) and Manheim Auction Inc. (“MA”) entered a consent decree with OFCCP on September 13, 2011 agreeing to being debarred from bidding on federal contracts following an Administrative Law Judge (“ALJ”) ruling the two contractors were subject to OFCCP’s jurisdiction. Continue reading

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Filed under Affirmative Action Plan (AAP), Department of Labor, Executive Order, OFCCP, Rehabilitation Act, Veterans