OFCCP V. VF JEANSWEAR LIMITED: ALJ DELIVERS SUMMARY JUDGMENT RULING IN FAVOR OF VF ON SUBGROUP AGGREGATION

The ruling, by ALJ Kenneth A. Krantz was handed down on 8/5/13 and may be viewed here. What’s interesting in this ruling is that OFCCP, for all intents and purposes, believed that VF was showing preference for Asians versus all other protected groups. The problem is that the consultant hired by OFCCP testified that he saw no evidence of disparate treatment of applicants, which requires proof of motive, but testified there was evidence of disparate impact, which requires no proof of motive. The consultant, a labor economist, compared 182 Asian applicants to 367 non-Asian applicants and testified that 87 Asians as compared to 86 non-Asians were selected for interview, representing a shortfall of 29.6 non-Asians. His conclusions were:

a. Applicants referred by employees were given priority in selection for interviews;
b. Asian employees were much more likely to use the referral system;
c. Asian employees made the most referrals; and
d. Asian employees were highly likely to refer Asian applicants when making referrals.

Interestingly, OFCCP did not request the consultant to disaggregate the non-Asian groups, leaving, in ALJ Krantz’s words, a combination of “one group that was over-represented (Hispanics), one group that was under-represented (Whites) and one group that was closely proportional to the regional percentage (Blacks)”. Citing both implementation regulations for Executive Order 11246 and the Uniform Guidelines, Krantz noted that employers are prohibited from using “employee selection procedures with a disparate impact on a “race” or “ethnic group”, but also, that the non-Asian category “is neither a race nor an ethnic group, either by regulatory definition or as used in common parlance.” Hence the summary judgment favoring VF. It will be interesting to see if OFCCP appeals.

by Art Gutman, Ph.D., Professor, Florida Institute of Technology

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