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Employer Discrimination Update: Contracts With The Government Can Cost You Millions If Your Hiring Practices Violate Federal Laws

above-the-bar-logo.jpgThe Department of Labor (“DOL”) announced this week that it has reached a $3 million settlement with federal contractors FedEx Ground Package System, Inc. and FedEx SmartPost Inc. (collectively referred to as “FedEx”) over allegations that they discriminated against job applicants at two dozen facilities in 15 states. Under the terms of the agreement, FedEx will also implement changes to correct any discriminatory hiring practices and give job offers to those who were rejected as positions become available.

The settlement covers a total of 21,635 rejected job applicants who will receive back wages and interest and as well as job offers to 1,703 individuals as they become available. Of the affected workers, 61 percent are female, 52 percent are African American, 14 percent are Hispanic, 2 percent are Asian, and 1 percent are Native American. If you have suffered from discrimination with respect to any aspect of employment, including hiring, firing, promotion, pay, benefits, or compensation, our attorneys can help you determine if you have a claim. Our attorneys have helped many individuals recover their workplace rights.

The DOL’s Office of Federal Contract Compliance Programs, which monitors the employment practices of the country’s 200,000 federal contractors, first found evidence that FedEx was discriminating on the basis of sex, race, and national origin in its hiring practices seven years ago. During scheduled reviews, the compliance office found that compared to similarly situated white applicants, there was discrimination against African Americans, Hispanics, Asian Americans and Native Americans. The review also showed discrimination against women who were automatically ruled out for jobs requiring heavy lifting.

The Director of the compliance office, Patricia A. Shiu, stated that audits revealed evidence of bias even where job applicants didn’t complain or realize that they had been discriminated against. The evidence consisted of a computer statistical analysis as well as interviews with job applicants and FedEx officials. Shiu stated that “Being a federal contractor is a privilege and means you absolutely, positively cannot discriminate, not when you are profiting from taxpayer dollars.”

In addition to the monetary settlement, FedEx has also agreed to correct any discriminatory hiring practices, train its employees, and implement self-monitoring measures to make sure that all hiring practices are legally compliant. It has also agreed to hire an outside consultant to conduct an extensive review of the company’s hiring practices and make recommendations to change and improve their practices, as well as train its supervisors and employees.

If you are a covered employer with government contracts, make sure you are in full compliance with all federal regulations. FedEx did not admit to any wrongdoing in this case and did not feel that it engaged in any discriminatory practices. However, the statistical numbers showed a different story. Whether or not FedEx was engaged in discriminatory hiring practices, it still incurred the cost of settling and now having to make expensive changes throughout the company.

Our attorneys have helped many businesses make sure that all their employment practices are in accord with state and federal laws. Our attorneys have also conducted training seminars to help companies prevent unnecessary litigation. If you have contracts with the government, call our Employment Discrimination Attorneys at Villanueva & Sanchala at (800) 893-9645 to discuss how we can help you make sure your company is in full compliance with all state and federal laws.


Thank you for visiting our Blog. This blog provides general information and thoughts about various employment law issues primarily in the New York Tri-State area and occasionally in other areas. You are welcome to read the posts. However, do not construe any content on this blog as legal advice or the creation of an attorney-client relationship. Again, we provide the content only for informational purposes. You should not make decisions based information on our blog since the application of the law depends on the facts and each situation may be different. In addition, the law in most jurisdictions is different and changes constantly and we make no representations that any information on our blog has been updated. The Blog should not be used as a substitute for competent legal advice from an experienced employment law attorney in your state or jurisdiction.

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