Our colleagues Patrick G. Brady and Julie Saker Schlegel, at Epstein Becker Green, have a post on the Retail Labor and Employment Law blog that will be of interest to many of our readers in the technology industry: “Beyond Joint Employment: Do Companies Aid and Abet Discrimination by Conducting Background Checks on Independent Contractors?

Following is an excerpt:

Ever since the National Labor Relations Board (“NLRB”) issued its August 2015 decision in Browning-Ferris Industries of California, Inc., holding two entities may be joint employers if one exercises either direct or indirect control over the terms and conditions of the other’s employees or reserves the right to do so, the concept of joint employment has generated increased interest from plaintiffs’ attorneys, and increased concern from employers. Questions raised by the New York Court of Appeals in a recent oral argument, however, indicate that employers who engage another company’s workers on an independent contractor basis would be wise to guard against another potential form of liability, for aiding and abetting acts that violate various anti-discrimination statutes, including both the New York State (“NYSHRL”) and New York City Human Rights Laws (“NYCHRL”) and the New Jersey Law Against Discrimination (“NJLAD”).

Read the full post here.

Our colleagues Brian W. Steinbach and Judah L. Rosenblatt, at Epstein Becker Green, have a post on the Heath Employment and Labor blog that will be of interest to many of our readers in the technology industry: “Mayor Signs District of Columbia Ban on Most Employment Credit Inquiries.”

Following is an excerpt:

On February 15, 2017, Mayor Muriel Bowser signed the “Fair Credit in Employment Amendment Act of 2016” (“Act”) (D.C. Act A21-0673) previously passed by the D.C. Council. The Act amends the Human Rights Act of 1977 to add “credit information” as a trait protected from discrimination and makes it a discriminatory practice for most employers to directly or indirectly require, request, suggest, or cause an employee (prospective or current) to submit credit information, or use, accept, refer to, or inquire into an employee’s credit information. …

Read the full post here.

The United States Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”) on January 17, 2017, just days before the inauguration of President Donald Trump, filed a lawsuit against Oracle America, Inc. (“Oracle”), alleging discrimination in its compensation and hiring practices, and its refusal to produce requested records and data. See Complaint. The lawsuit, filed with the Office of Administrative Law Judges, stems from a compliance review initiated by the OFCCP on September 24, 2014 at Oracle’s Redwood Shores headquarters in California, housing 7,000 employees.

As a federal government contractor, subject to Executive Order 11246, the Rehabilitation Act and the Vietnam Era Veterans’ Readjustment Assistance Act, Oracle is contractually obligated not to discriminate in employment on the basis of certain protected characteristics, which include race, color, religion, sex, sexual orientation, gender identity, national origin, disability, and status as a protected veteran. In addition, Oracle is required to take affirmative action to ensure that applicants and employees are afforded employment opportunities without regard to these protected characteristics. As part of its contracts with the federal government, Oracle also agrees to allow the OFCCP to inspect its employment records to ensure the company’s compliance with its non-discrimination and affirmative action obligations.

The lawsuit seeks to redress violations of Executive Order 11246 stemming from the tech giant’s alleged “systemic compensation discrimination” against qualified women, Asians and African Americans employed in Information Technology, Product Development and Support positions (encompassing 80 job titles), and its “pattern and practice of hiring discrimination” against qualified White, Hispanic and African American applicants in favor of Asian applicants, namely Asian Indians, in the Professional Technical 1, Individual Contributor and the Product Development job groups (involving 69 job titles). The OFCCP specifically alleged that there were “gross disparities in pay” and “[statistically] significant overrepresentation” of Asians in the applicant pools and affected positions. In making its findings, the OFCCP indicated that Oracle refused to produce prior year compensation data and complete hiring data, and further refused to produce documentation demonstrating that it had performed “an in-depth review of its compensation practices” and that it had analyzed its applicant-hiring data for adverse impact.

Having found discrimination, the OFCCP issued a Notice of Violations, and three months later a Notice to Show Cause seeking an explanation for why the agency should not initiate enforcement proceedings. Seven months later, after conciliation efforts failed, the OFCCP instituted the instant action. While only Oracle and the OFCCP know what was discussed and debated in an attempt to bring about a resolution, clearly the OFCCP was not satisfied with Oracle’s explanations justifying the pay disparities and hiring practices, nor pleased with the company’s refusal to produce the additional compensation and hiring data requested. As a result, the OFCCP is seeking a decision finding that Oracle’s compensation and hiring practices violated Executive Order 11246, and an order permanently enjoining the company from failing and refusing to comply with its obligations, cancelling its federal government contracts, debarring it from entering into future contracts until remedying its prior noncompliance, and requiring it “to provide complete relief to the affected classes, including lost compensation, interest and all other benefits of employment resulting from Oracle’s discrimination.” Simply put, there are millions of dollars at stake.

Action Steps Employers Should Take Now

While it is still unclear what agenda the Trump Administration will expect the OFCCP to follow, so long as the status quo remains, federal government contractors should take heed. The OFCCP clearly intends to send a message with this and other lawsuits recently filed. Contractors should therefore be proactive to ensure that their compensation practices are not causing significant pay disparities that cannot be justified. They also need to ensure that their hiring practices are such that they are considering a diverse slate of candidates drawn from well-balanced recruiting pools and making hiring decisions without regard to gender, race and ethnicity. Both can be accomplished by contractors engaging counsel to conduct self-audits to ensure that they are in compliance and meeting all of their non-discrimination/affirmative action obligations as a federal government contractor. If such action is not taken, then they may face the same level of scrutiny and consequences as Oracle.

Throughout 2016, the Equal Employment Opportunity Commission (“EEOC” or “Commission”) has been examining initiatives to identify and attempt to rectify a perceived lack of diversity in the workplace. The EEOC has, in particular, identified the technology industry as an area where significant strides can be made to create a more diverse workforce.

Following a May 18, 2016, public meeting on diversity in the technology industry, the EEOC issued a “Diversity in High Tech” report (“Report”) summarizing research on the lack of diversity in the “high-tech sector,” defined as industries that employ a high concentration of employees in the STEM (science, technology, engineering, and mathematics) occupations and the production of goods and services advancing the use of electronic and computer-based production methods. The Report highlighted several demographic trends within the industry, generally showing that the high-tech sector is still predominantly white, male, and under 40 years old. Citing the high-tech sector as “a major source of economic growth fueling the U.S. economy,” the Report also identified demographic differences among the types of positions within the industry, noting that African Americans and Hispanics were disproportionately underrepresented in leadership positions in technology jobs.

According to the Report, the lack of diversity in the labor force within the high-tech sector can be attributed to the demographics of graduates with STEM degrees. Nearly 70 percent of graduates in engineering, mathematics, and computer science are men. While the Obama administration has included STEM education as a priority, the current graduates in STEM fields are significantly less diverse than in the general labor market.

Further, more than half of the women working at STEM companies in the high-tech sector eventually leave or do not advance within the STEM industry. The Report attributed women’s exit from the high-tech sector to an “inhospitable” work culture, isolation, work styles incompatible with the “firefighting” style generally rewarded, long hours and travel, and a glass-ceiling effect.

While the high-tech sector originated in Silicon Valley, the scope of this industry has grown across the United States. To see whether the diversity statistics differed at the epicenter of high tech, the Report further analyzed the labor force within Silicon Valley. The labor force generally in Silicon Valley is split evenly between men and women; however, within the tech industry, it becomes a 70-30 split in favor of men. While Asian Americans fared better within Silicon Valley than across the national survey for professional jobs, white men “dominated” leadership positions across the nation and even more significantly in Silicon Valley.

While the Report is valuable in highlighting changes that are necessary to create a more diverse workforce within the technology industry, the EEOC’s public meeting made clear that the Commission expects technology companies to address what it perceives to be the implicit and unconscious biases leading to the current demographics. In many technology start-ups, hiring practices and human resources policies are generally among the last concerns in growing companies; thus, companies recruit via word of mouth or weed out certain categories of candidates, such as older workers, leading to a more homogenous workforce. The findings stated in the Report and at the public meeting should encourage emerging companies to consider employee issues at the forefront, rather than as a secondary concern.

In Silicon Valley, where the lack of diversity is amplified within the high-tech sector, changes in California law may encourage employers to recruit from a more diverse pool of candidates. At the end of June, the California Legislature passed an amendment to the Equal Pay Act that, if signed by the governor, would provide a cause of action for a differential in pay on the basis of race or ethnicity unless the employer can show that the difference is based on a bona fide factor other than race or ethnicity. (The California Equal Pay Act was also recently amended to protect women more strongly against pay differentials.)

In addition to the Report, recently proposed EEOC guidance on national origin discrimination and the EEOC’s updated proposed rule to include salary bands on the annual EEO-1 report demonstrate the Commission’s commitment to encouraging a more diverse and inclusive workforce. The EEOC’s in-depth look at the high-tech sector should induce technology employers to review hiring practices and audit the diversity within their workforce, as the EEOC’s enforcement of systemic discrimination has increased significantly over the past 10 years.

A version of this article originally appeared in the Take 5 newsletter “Five Trending Challenges Facing Employers in the Technology, Media, and Telecommunications Industry.”

Our colleague Linda B. Celauro, Senior Counsel at Epstein Becker Green, has a post on the Financial Services Employment Law blog that will be of interest to many of our readers in the technology industry: “Seventh Circuit Panel Finds That Title VII Does Not Cover Sexual Orientation Bias.

Following is an excerpt:

Bound by precedent, on July 28, 2016, a panel of the U.S. Court of Appeals for the Seventh Circuit held that sexual orientation discrimination is not sex discrimination under Title VII of the Civil Rights Act of 1964. The panel thereby affirmed the decision of the U.S. District Court for the Northern District of Indiana dismissing the claim of Kimberly Hively, a part-time adjunct professor at Ivy Tech Community College, that she was denied the opportunity for full-time employment on the basis of her sexual orientation.

The importance of the Seventh Circuit panel’s opinion is not in its precise holding but both (i) the in-depth discussion of Seventh Circuit precedence binding it, the decisions of all of the U.S. Courts of Appeals (except the Eleventh Circuit) that have held similarly, and Congress’s repeated rejection of legislation that would have extended Title VII’s protections to sexual orientation, and (ii) the multifaceted bases for its entreaties to the U.S. Supreme Court and the Congress to extend Title VII’s prohibition against sex discrimination to sexual orientation discrimination.

The Seventh Circuit panel highlighted the following reasons as to why the Supreme Court or Congress must consider extending Title VII’s protections to sexual orientation …

Read the full post here.

Our colleague Frank C. Morris, Jr., attorney at Epstein Becker Green, has a post on the Financial Services Employment Law blog that will be of interest to many of our readers in the technology industry: “New Online Recruiting Accessibility Tool Could Help Forestall ADA Claims by Applicants With Disabilities.”

Following is an excerpt:

In recent years, employers have increasingly turned to web based recruiting technologies and online applications. For some potential job applicants, including individuals with disabilities, such as those who are blind or have low vision, online technologies for seeking positions can prove problematic. For example, some recruiting technologies and web-based job applications may not work for individuals with disabilities who use screen readers to access information on the web. The U.S. Department of Labor’s Office of Disability Employment Policy (ODEP) recently announced the launch of “TalentWorks.”

Read the full post here.

Our colleagues Peter M. Panken, Nancy L. Gunzenhauser, and Marc-Joseph Gansah have a post on the Retail Labor and Employment Blog that will be of interest to many of our readers in the technology industry: “Employers Should Care About This: New York City’s Amendment on Caregiver Discrimination.”

Following is an excerpt:

The New York City’s Human Rights law (“NYCHRL”) prohibits employment discrimination against specified protected classes of employees and applicants including:

race, color, creed, age, national origin, alienage or citizenship status, gender, sexual orientation, disability, marital status, partnership status, any lawful source of income, status as a victim of domestic violence or status as a victim of sex offenses or stalking, whether children are, may be or would be residing with a person or conviction or arrest record.

If this list wasn’t long enough, on May 4, 2016, NYCHRL will add “caregivers” to the protected classes including, anyone who provides ongoing medical or “daily living” care for a minor, any disabled relative or disabled non-relative who lives in the caregiver’s household. …

Read the full post here.

Nancy L. Gunzenhauser
Nancy L. Gunzenhauser

On March 3, 2016, the EEOC issued a one-page fact sheet aimed at assisting start-ups and small businesses understand their responsibilities under the various federal employment laws. The fact sheet, which is available in over 30 languages, reminds employers that:

  • employment decisions cannot be made on the basis of protected categories
  • employers should establish policies that do not disparately impact employees on the basis of protected categories
  • men and women must be provided equal pay
  • employers should prevent harassment, but if a complaint is raised, employers should promptly address claims of harassment or discrimination
  • employers should provide reasonable accommodations for medical and religious purposes
  • employers must display required posters
  • employment records must be kept, including applications and personnel files

The EEOC’s fact sheet provides some helpful points for small businesses, who may not always be considering employment issues. Small employers must have at least 15 employees for the federal anti-discrimination laws to apply. Even without 15 employees, several laws (including New York City’s Human Rights Law) can still apply to these start-ups. Make sure to reference EBG’s TMT Start-Up Employment Law Reference as your business grows! As your new and emerging business continues to grow, make sure to consider how various employment laws may be implicated.

Our colleague Nancy L. Gunzenhauser, an Associate at Epstein Becker Green, has a post on the Retail Labor and Employment Blog that will be of interest to many of our readers in the technology industry: “Reminder: All Philadelphia Employers Must Post New Ban-the-Box Poster.”

Following is an excerpt:

One of the requirements of the amended Philadelphia ban-the-box law has gone into effect. As of March 14, 2016, Philadelphia employers are required to post a new poster provided by the Philadelphia Commission on Human Relations in a conspicuous place on both the employer’s website and on premises, where applicants and employees will be most likely to notice and read it. …

Read the full post here.

Our colleague Joshua A. Stein has a Retail Labor and Employment Law Blog post that will be of interest to many of our technology industry readers: “Defending Against Website Accessibility Claims: Recent Decisions Suggest the Primary Jurisdiction Doctrine Is Unlikely to Serve As Businesses’ Silver Bullet.”

Following is an excerpt:

For businesses hoping to identify an avenue to quickly and definitively defeat the recent deluge of website accessibility claims brought by industrious plaintiff’s firms, advocacy groups, and government regulators in the initial stages of litigation, recent news out of the District of Massachusetts – rejecting technical/jurisdictional arguments raised by Harvard University and the Massachusetts Institute of Technology – provides the latest roadblock. …

These recent decisions reveal a reluctance among the courts to dismiss website accessibility actions on technical/jurisdictional grounds.  Taken along with the expanding number of jurisdictions who subscribe to legal theories accepting that Title III covers website accessibility (whether adopting a nexus theory or broadly interpreting the spirit and purpose of the ADA) and it is becoming increasingly clear that many businesses will have a difficult time ridding themselves of website accessibility claims in the early stages of litigation.  Of course, these decisions have been quick to note they do not foreclose a variety of potentially successful defenses that may be asserted later in the litigation – e.g., undue burden, fundamental alteration, and the provision of equivalent/alternative means of access.  While, to date, the existing website accessibility case law has not focused on when these defenses might prevail, with the recent proliferation of website accessibility demand letters and litigation, businesses should soon find themselves with greater guidance from the courts.  In the interim, the best way to guard against potential website accessibility claims continues to be to take prophylactic measures to address compliance before you receive a demand letter, complaint, or notice of investigation.

Read the full post here.