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OFCCP suit against Google demonstrates continued aggressive enforcement in waning days of Obama Administration

January 12th, 2017  |  Cynthia L. Hackerott  |  1 Comment

Last week’s announcement by the OFCCP of its administrative lawsuit against Google, Inc, asserting that the technology giant unlawfully refused to provide certain compensation-related information in a compliance review, has been well-publicized. Citing confidentiality and breadth of scope concerns, Google, Inc provided a statement to multiple news entities, including Employment Law Daily (ELD), asserting that its refusal to provide the information was justified. This administrative action against Google is the latest in an apparent trend of OFCCP suits against major tech companies, noted attorney and former OFCCP official John C. Fox in commentary provided to ELD on January 4.

“We are seeing OFCCP file a large number of administrative complaints in recent weeks, at least compared to OFCCP’s historical averages,” observed Fox. “It very much appears that the Obama OFCCP is ‘spiking the cannons’ as it leaves office and before the incoming Trump Administration can have a chance to see if disputes between government contractors and OFCCP in the audit pipeline are meritorious.”

Fox, currently president of the Silicon Valley area firm, Fox, Wang & Morgan P.C. in Los Gatos, California, also noted that ‘[i]n the San Francisco Regional Office, it is very clear that [OFCCP Pacific Regional Director] Janette Wipper is trying to send a message to the ‘big dogs’ in the tech industry (Microsoft, Oracle, Palantir, and now Google) that she is there and is prowling.”

Dueling narratives. Google’s federal contracts include one with the General Services Administration, awarded in June 2014, for “Advertising and Integrated Marketing Solutions,” under which Google has received over $600,000, according to the OFCCP’s complaint (DOL OALJ No 2017-OFC-4). In a January 4, 2017 press release announcing the suit, the OFCCP asserts that Google violated the laws enforced by the agency and breached its obligations as a federal contractor when it refused to provide the requested information as part of a routine compliance evaluation of the multinational company’s Mountain View, California headquarters. However, in the statement provided by a Google spokesperson to ELD, also on January 4, the company states that “the handful of OFCCP requests” which are the subject of the lawsuit by the agency “are overbroad in scope, or reveal confidential data,” and that the company has attempted to make this clear to the agency.

Information sought. The complaint asserts that the OFCCP initiated the review in September 2015, and on June 1, 2016, the agency requested the following information:

  • A compensation snapshot as of September 1, 2014;
  • Job and salary history for employees in a September 1, 2015 compensation snapshot that Google had produced and the requested September 1, 2014 snapshot, including starting salary, starting position, starting “compa-ratio,” starting job code, starting job family, starting job level, starting organization, and changes to the foregoing; and
  • The names and contact information for employees in the previously produced September 1, 2015 snapshot and the requested September 1, 2014 snapshot.

Approximately on June 17, 2016, “Google communicated its refusal to produce” the above items, among others, the complaint alleges, adding that “[i]n the months that followed, OFCCP repeatedly attempted to obtain Google’s agreement to produce” the items at issue.

On September 16, 2016, the agency issued a Notice to Show Cause regarding the items at issue, but the complaint alleges that, as of the date it was filed with the DOL’s Office of Administrative Law Judges, Google has “persisted in its refusal” to produce the items at issue.

“Like other federal contractors, Google has a legal obligation to provide relevant information requested in the course of a routine compliance evaluation,” said OFCCP Acting Director Thomas M. Dowd in the agency’s statement. “Despite many opportunities to produce this information voluntarily, Google has refused to do so. We filed this lawsuit so we can obtain the information we need to complete our evaluation.”

Google statement. Contesting these allegations in the statement provided to ELD, the Google spokesperson said the following:

“We’re very committed to our affirmative action obligations, and to improving the diversity of our workforce, and have been very vocal about the importance of these issues. As a federal contractor, we’re familiar with our obligations and have worked collaboratively with the OFCCP. We’ve worked hard to comply with the OFCCP’s current audit and have provided hundreds of thousands of records over the last year, including those related to compensation. However, the handful of OFCCP requests that are the subject of the complaint are overbroad in scope, or reveal confidential data, and we’ve made this clear to the OFCCP, to no avail. These requests include thousands of employees’ private contact information which we safeguard rigorously. We hope to continue working with OFCCP to resolve this matter.”

Complications with ‘just writing the check.’ “The question remains whether the Google filing is merely an OFCCP publicity stunt designed to test the resolve of the big tech companies to defend themselves and see whether they will simply ‘write the check’ to move on (‘fly biting the leg of the elephant’ problem),” Fox noted. “Thus far, the tech industry has shown no interest to ‘just write the check’ (other than in a recent Qualcomm compensation lawsuit unrelated to OFCCP).”

“The problem with ‘just writing the check’ in compensation cases (as opposed to hiring cases where OFCCP’s expertise lies) is that the at-issue government contractor must be fair to all employees,” he explained. “The contractor cannot just willy-nilly raise the salaries of some employees OFCCP chooses to exalt without creating both legal liability to other similarly situated employees and wreaking havoc on morale as side-by-side colleagues now rankle that others in their work group are now suddenly paid more for doing the same work based simply on their race, sex or ethnicity. Unthoughtful ‘write the check’ resolutions lacking proper technical foundations for changing the pay of some employees while not all similarly situated employees in compensation cases have often recently resulted in successful lawsuits by those employees not favored in a ‘quick and dirty’ settlement entered into to simply to appease ‘political’ and shareholder unrest.”

Responses

  1. Chris Chrisbens says:

    January 20th, 2017 at 8:51 am

    Not what we might expect as this particular crossroad in time but demonstrates that pay issues are likely to remain a hot topic.

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