Qualcomm’s Private Settlement of Pay Bias Claim Enough for DOL

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By Jay-Anne B. Casuga

Qualcomm Inc. agreed to resolve Labor Department sex discrimination in pay allegations by tying the administrative settlement to a private $19.5 million class action settlement negotiated last year, according to agency documents published April 11.

It’s unusual for conciliation agreements between a government contractor and the DOL’s Office of Federal Contract Compliance Programs to be connected to an earlier private settlement, a former OFCCP official and a management attorney told Bloomberg BNA. Neither are involved in the Qualcomm settlement.

“It is not unprecedented to have a private class lawsuit covering similar individuals or conduct as an OFCCP violation, but it’s pretty rare in my experience to see this kind of coordinated resolution,” said Pamela Coukos, a former OFCCP senior program advisor during the Obama administration. Coukos focused on compensation discrimination issues while at the agency. She’s now a co-founder and principal of Working IDEAL, a consulting firm in Washington.

The unusual settlement “represents what could be a coming trend,” Valerie J. Hoffman, a partner with Seyfarth Shaw in Los Angeles and Chicago and co-chair of the firm’s Employment Analytics Group and OFCCP, Affirmative Action & Diversity Team, told Bloomberg BNA.

“Where OFCCP is conducting a compliance evaluation that includes interviews of employees regarding their pay and pay equity, employees who believe they are being paid less based on their gender or race/ethnicity may decide to retain counsel and file a private lawsuit at the same time the OFCCP audit is continuing,” Hoffman said.

Functional Units Audited

Here, the OFCCP between 2013 and 2014 conducted compliance audits of Qualcomm’s CDMA Tech and Corporate Services functional units. The majority of the OFCCP’s audits focus on specific contractor facilities. Functional audits, however, aren’t necessarily limited to a particular geographic area.

The agency evaluated and analyzed the units’ compensation systems and found “statistically significant pay disparities” between male and female employees in engineering job functions beginning in May 2011. The agency alleged that men were paid at a rate “significantly greater” than their female counterparts who were “equally or more qualified.” It issued a notice of violation in February 2017.

The agency said its March 6 conciliation agreement with Qualcomm “incorporates relief expected to be provided” in the private litigation, Pan v. Qualcomm Inc., S.D. Cal., No. 16-01885.

Private Settlement Covers About 3,300

In that case, a class of about 3,300 female current and former Qualcomm employees alleged that the company discriminated against them in pay, promotions and other employment opportunities in violation of Title VII of the 1964 Civil Rights Act, the Equal Pay Act, and California law. The OFCCP enforces Executive Order 11,246, which contains prohibitions against pay discrimination similar to Title VII’s.

A proposed $19.5-million settlement in Pan was filed last July, one day after the complaint was filed. A federal judge in California granted preliminary approval of that proposal in December. A motion for final approval was filed in February.

The OFCCP said the provisions of the Pan settlement agreement “shall provide an effective remedy for the female engineers identified by OFCCP.” Its conciliation agreement with Qualcomm also includes various compliance monitoring and reporting requirements.

The OFCCP’s settlement with Qualcomm follows pay bias settlements the agency reached earlier this year with Land O’Lakes Inc. and LexisNexis Risk Solutions. It also follows agency administrative lawsuits alleging pay discrimination against JPMorgan Chase & Co. and Oracle America Inc.

Furthermore, the OFCCP is currently taking on Google Inc. in a lawsuit claiming the company unlawfully denied the agency access to its compensation data.

‘Positive Outcome in Concept’

The OFCCP-Qualcomm settlement “seems like a positive outcome in concept,” Coukos said.

“From the worker perspective, it means that in addition to court oversight there will also be agency monitoring of the injunctive relief and salary adjustments through the reports provided to OFCCP,” Coukos said. “At the same time, the employer is getting a complete resolution of the issues.”

Hoffman said the settlement serves to remind contractors that they should be making efforts to ensure that their pay is defensible. This includes conducting their own analysis under attorney-client privilege to “identify and remedy any differences that appear to be linked to gender or race,” she said.

Qualcomm representatives didn’t immediately respond to Bloomberg BNA’s April 11 request for comments. A DOL spokesman declined to comment on the settlement apart from acknowledging that it’s “not common.” Attorneys with Sanford Heisler, which represented the class of female employees in Pan, also declined to comment.

Qualcomm and its subsidiaries have received more than $6 million in federal contracts since fiscal year 2013, according to Bloomberg Government’s database of publicly reported government contracts.

To contact the reporter on this story: Jay-Anne B. Casuga in Washington at jcasuga@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com; Christopher Opfer at copfer@bna.com

For More Information

The conciliation agreement is available at http://src.bna.com/nPu.

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