A federal contractor agreed to settle charges by the U.S. Department of Labor's Office of Federal Contract Compliance Programs (OFCCP) that it discriminated in its hiring practices by creating multiple barriers in its paper and online application systems to prevent African Americans from advancing in the selection process. Such systemic race discrimination resulted in the rejection of 5,557 qualified African American applicants in violation of Executive Order 11246.

The contractor will pay $1 million in back wages and interest to the affected job seekers, provide 48 entry-level positions to class members and revise its selection policies and procedures to ensure future compliance.

This is the second time in 11 years that the contractor has settled a hiring discrimination case with the OFCCP. In 2003, following an OFCCP review that uncovered discrimination against minorities and women applying for entry-level factory jobs, the contractor agreed to pay $1 million in back pay and interest to the affected workers.

Since 2005, the contractor has held over $2 million in contracts to perform work for the federal government. Executive Order 11246 — together with Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans' Readjustment Assistance Act of 1974 — requires federal contractors and subcontractors ensure they do not engage in employment discrimination on the basis of sex, race, color, religion, national origin, disability or status as a protected veteran.

The OFCCP actively audits federal contractors to evaluate their compliance with the federal affirmative action regulations. Such audits focus on tests, online applications, job requirements and other potential barriers to hiring that have an adverse impact on protected classes. Material violations can result in significant sanctions, making it crucial that federal contractors and subcontractors adopt uniform, nondiscriminatory hiring practices with a system of internal controls to prevent any disparate impact.

Thomson Reuters' online Federal Contracting (OFCCP) Essentials course provides human resource professionals with the tools they need to understand — and properly implement — a wide range of OFCCP requirements including those affecting the hiring process. Online compliance training is an effective way for federal contractors and subcontractors to understand the fundamental requirements of the OFCCP rules and avoid sanctions, negative publicity and lost business opportunities that result from violations.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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