OFCCP Settles Pay Discrimination Claims With Medical Products Manufacturer

by Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
Contact

As all federal contractors and subcontractors know, the Office of Federal Contract Compliance Programs (OFCCP) has made investigation of compensation discrimination a priority. This emphasis aligns with the president’s pronouncements on the alleged “pay gap” between men and women. Therefore, it is interesting that the OFCCP’s recent settlement with medical products manufacturer Medtronic, Inc. and Medtronic Interventional Vascular, Inc. was not a finding of gender discrimination in compensation. Instead, the Medtronic settlement was predicated on allegations that the contractor paid Hispanic senior production associates “significantly less per year” than white senior production associates at the contractor’s facility in Danvers, Massachusetts.

In the settlement, which is memorialized in a consent decree between OFCCP and the contractor, Medtronic has agreed to pay a class of 78 Hispanic production associates $290,000 in back wages plus interest. In addition to this monetary relief, the contractor also must provide equal employment opportunity training to managers and employees.

The consent decree states that the salary disparity between Medtronic’s white and Hispanic senior production associates existed even “after adjusting for differences in legitimate, pay-determining factors.” In addition, the consent decree notes that the position of senior production associate is an entry-level position, that all of these positions are “characterized” as being in the same job group, and that “pay-deciding officials of Medtronic have exercised discretion when setting compensation amounts” for senior production associates.

This settlement was announced shortly after the OFCCP suffered a setback in the case of VF Jeanswear, where an administrative law judge ruled that the agency improperly aggregated a group of employees into a “non-Asian” category in order to compare their treatment to the class of Asian workers. In the Medtronics case, the OFCCP compared Hispanic compensation to the compensation paid to white employees. However, it is not clear whether the OFCCP’s compensation analysis in the Medtronics case merely focused on a comparison of current pay or whether the agency followed Title VII principles in comparing pay decisions (such as starting pay, promotional increases, or merit increases), as required by the Supreme Court of the United States in Ledbetter v. Goodyear Tire & Rubber Co.

Key “Take Aways” From the Medtronics Case:

  1. Employees who make compensation decisions should be trained on a regular basis on equal employment principles.
  2. Particularly in entry level positions where prior experience may not be required, contractors should consider setting uniform base salaries or rates and recognizing superior production or goal attainment through an annual lump sum bonus.
  3. To the extent a contractor determines that discretion in setting compensation is necessary given business pressures, then regular analysis of pay decisions should be done within the attorney-client privilege to ensure that any differences in pay are defensible based upon legitimate, non-discriminatory reasons.

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.

© Ogletree, Deakins, Nash, Smoak & Stewart, P.C. | Attorney Advertising

Written by:

Ogletree, Deakins, Nash, Smoak & Stewart, P.C.
Contact
more
less

Ogletree, Deakins, Nash, Smoak & Stewart, P.C. on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.