OFCCP, USDOL v. WMS Solutions, LLC, ARB No. 2020-0057, ALJ No. 2015-OFC-00009 (ARB Nov. 18, 2021) (per curiam) (Decision and Order)

APPOINTMENTS CLAUSE; ARB ADDRESSES SUPREME COURT DECISION IN CARR, AND DETERMINES THAT OFCCP PROCEEDINGS MANDATE THAT AN APPOINTMENTS CLAUSE CHALLENGE BE RAISED WHILE THE CASE IS STILL BEFORE THE ALJ

In OFCCP, USDOL v. WMS Solutions, LLC, ARB No. 2020-0057, ALJ No. 2015-OFC-00009 (ARB Nov. 18, 2021) (per curiam), Respondent argued that the ALJ was improperly appointed under the Appointments Clause of the Constitution, and that the case should be remanded for assignment to a new ALJ consistent with the Supreme Court’s decision in Lucia v. SEC, 138 S. Ct. 2044 (2018).

The ARB noted that it had ruled in several prior cases that Appointments Clause objections must be raised before the ALJ.  See, e.g., Riddell v. CSX Transportation, Inc., ARB No. 2019-0016, ALJ No. 2014-FRS-00054 (ARB May 19, 2020); Perez v. BNSF Ry. Co., ARB Nos. 2017-0014, -0040, ALJ No. 2014-FRS-00043 (ARB Sept. 24, 2020).  The ARB, however, had asked for supplemental briefing from the parties in the instant case in view of the Supreme Court’s decision in Carr v. Saul, 141 S. Ct. 1352 (2021), where the plaintiffs were allowed to raise their Appointments Clause objection in the SSA hearing context for the first time in federal court.  The ARB found that (1) the OFCCP regulations require issue exhaustion; and (2) even if issue exhaustion by the regulations is not required, applying the reasoning in Carr, it is nonetheless required in OFCCP cases .

The ARB noted that unlike SSA proceedings, “OFCCP proceedings involve both parties fully developing the record and ample issue development.”  Slip op. at 11.  The ARB found that ALJs in OFCCP proceedings regularly address as-applied constitutional issues, including 4th Amendment issues—and that DOL ALJs have in the past had OFCCP cases reassigned to new ALJs when parties requested a reassignment due to Appointments Clause concerns. The ARB stated:  “The ALJs in these cases not only have the authority to address this issue—they have a prior history of doing so.”  Id. at 12.  The ARB further determined that requiring issue exhaustion was appropriate because “[t]he harm to judicial integrity and efficiency caused by permitting a party to undertake a lengthy proceeding before an ALJ only to challenge the ALJ’s authority on appeal, perhaps after an unfavorable decision, is not insignificant.”  Id. (footnote omitted).

The ARB determined that in the instant case, the ALJ had given the parties ample opportunity to raise the issue, and had warned of the consequences of failing to raise an issue with the ALJ.  The ARB noted that Respondent “had ample opportunity to raise the issue once it came to the forefront in the lead up and aftermath to the Supreme Court’s Lucia decision.” The ARB also noted that between the conclusion of the hearing, and the date of the ALJ’s decision, the Secretary of Labor had ratified all ALJ appointments.  The ARB thus concluded “because WMS failed to raise the issue before the ALJ, raising it now in the proceeding before the Board is untimely.”
 

OFCCP’S AUTHORITY TO INITIATE ENFORCEMENT PROCEEDINGS UNDER E.O. 11246; CONTRACTS SUBJECT TO E.O. 11246 INCORPORATE EQUAL EMPLOYMENT PROVISIONS EVEN IF NOT CONTAINED IN WRITTEN CONTRACT; 180 DAY LIMITATIONS PERIOD APPLIES TO WHEN INDIVIDUALS MAY BRING COMPLAINTS, BUT DOES NOT REQUIRE OFCCP TO BEGIN ENFORCEMENT WITHIN 180 DAYS; E.O. 11246 APPLIES TO THE CONTRACTOR AND NOT TO INDIVIDUAL CONTRACTS, AND OFCCP THUS MAY REVIEW ALL CONTRACTS OF COVERED CONTRACTOR

In OFCCP, USDOL v. WMS Solutions, LLC, ARB No. 2020-0057, ALJ No. 2015-OFC-00009 (ARB Nov. 18, 2021) (per curiam), Respondent raised several arguments relating to OFCCP’s authority to initiate the enforcement proceeding under EO 11246.

Respondent first argued that EO 11246 is an invalid exercise of power.  The ARB noted that this issue had been litigated extensively in the Federal courts.  The ARB determined, in any case, that it has no authority to review the validity of the regulations.

Respondent argued that it was not subject to EO 11246 because it had no written contracts with the asbestos subcontractor on the relevant GSA project, and that its only role was to supply labor.  The ARB agreed with the ALJ, however, that under the facts of the case and the broad definition of subcontractor under the regulations, there was a subcontract between the two entitles even though there was no written agreement.   The ARB also agreed with the ALJ that the subcontract was subject to the terms of EO 11246, Respondent having provided staff that executed covered construction work, and it being well established that contracts subject to EO 11246 incorporate the equal employment provisions of EO 11246 regardless of whether those provisions are actually contained in a written contract.

Respondent argued that OFCCP brought the complaint too late.  The ARB found that the regulations, when read collectively, provides that individuals may bring complaints, and must do so within 180 days of the incident giving rise to the complaint.   The regulations, however, do not require OFCCP to begin enforcement within 180 days.  The ARB found that, under the facts of the case, OFCCP followed the process appropriately, and its enforcement proceeding was not untimely.

Respondent argued that only its federal contracts should be subject to EO 11246.   The ARB, however, found that the plain language of both EO 11246 and the regulations indicate that the EO applies to the contractor, and not the individual contracts.  The ARB thus found that OFCCP’s review of all of Respondent’s contracts during the review period was appropriate.

BURDENS OF PRODUCTION AND PROOF IN AN E.O. 11246 INTENTIONAL DISPARATE TREATMENT CASE; BURDEN SHIFTING FRAMEWORK

In OFCCP, USDOL v. WMS Solutions, LLC, ARB No. 2020-0057, ALJ No. 2015-OFC-00009 (ARB Nov. 18, 2021) (per curiam), the ARB summarized the burdens of production and proof in an intentional disparate treatment case:

  •      In addition to relevant provisions of EO 11246, the implementing regulations, and Department precedent, the Board looks to federal appellate court decisions addressing similar pattern or practice claims of intentional discrimination adjudicated under Title VII of the Civil Rights Act of 1964. 

         To prevail on a claim of a pattern or practice of intentional disparate treatment, OFCCP must show that unlawful discrimination was WMS’s regular procedure or policy.  OFCCP bears the burden to produce sufficient evidence that there was a disparity and that being a member of a protected class was the cause. A pattern or practice claim requires that “discrimination was the company’s standard operating procedure[,] the regular rather than the unusual practice.” 

         OFCCP’s threshold burden is to make a prima facie showing that a pattern or practice of intentional discrimination on the part of the employer existed.  A prima facie case of a pattern or practice of discrimination can be proven by both statistical and anecdotal evidence. Courts have held that a statistical analysis that demonstrates a disparity in selection rates of job applicants of two to three standard deviations (i.e., a likelihood of less than five percent) is not likely due to chance or random variations and, therefore, may be sufficient evidence to meet the initial burden and establish a prima facie case of discrimination.  In other words, the probability of an event occurring by chance alone becomes less and less likely at higher standard deviations.

         In analyzing these type of cases, the Board may apply a burden-shifting framework, just as the ALJ properly did at the hearing in this case.  If OFCCP establishes a prima facie showing of discrimination, the burden shifts to the employer to rebut the presumption by either offering legitimate, non-discriminatory reasons for its actions, or by showing that the statistical proof was unsound.  This is a “burden of production, of ‘going forward’ with evidence of ‘some legitimate, nondiscriminatory reason for the [action].’”  The employer’s burden is “to defeat the prima facie showing of a pattern or practice by demonstrating that the proof is either inaccurate or insignificant.”  The burden can be met by “provid[ing] a nondiscriminatory explanation for the apparently discriminatory result.”
     
         However, an employer’s purported, legitimate nondiscriminatory reasons must be articulated with some specificity to avoid “conceal[ing] the target” at which employees must aim pretext arguments.  Although there is a risk that a nefarious employer may attempt to use subjective standards as “cover” for unlawful discrimination, subjective evaluation criteria “can constitute legally sufficient, legitimate, nondiscriminatory reason[s]” for an employer’s business decisions.  In fact, “subjective evaluations of a job candidate are often critical to the decision-making process.” The ultimate burden of persuading the trier of fact that the defendant intentionally discriminated remains at all times with the plaintiff.

          If the employer satisfies its burden of production, the presumption arising from plaintiff’s prima facie case drops out. The trier of fact must then determine whether the plaintiff has sustained its burden of proving by a preponderance of the evidence the ultimate facts at issue.  In other words, if the employer meets the burden to produce a legitimate, nondiscriminatory reason, the plaintiff must demonstrate that the proffered reason was not its true reason but was a pretext for unlawful discrimination.  If, however, the employer “fails to rebut the plaintiff's prima facie case, the presumption arising from an unrebutted prima facie case entitles the plaintiff to prevail on the issue of liability and proceed directly to the issue of appropriate relief.”

Slip op. at 17-20 (footnotes omitted). 

E.O. 11246 INTENTIONAL DISPARATE TREATMENT CASE; ARB AFFIRMED ALJ’S FINDING THAT OFCCP ESTABLISHED DISCRIMINATION AGAINST NON-HISPANIC WORKERS IN HIRING; RESPONDENT’S STATISTICAL EVIDENCE WAS BASED ON INCOMPLETE OR UNAVAILABLE EVIDENCE, AND WAS BASED ON PREMISE THAT AN ABESTOS LICENSE WAS REQUIRED TO BE CONSIDERED FOR EMPLOYMENT, BUT THAT PREMISE WAS INCONSISTENT WITH TESTIMONY OF RESPONDENT’S MANAGERS THAT RESPONDENT WOULD ASSIST WORKERS IN OBTAINING SUCH A LICENSE

E.O. 11246 INTENTIONAL DISPARATE TREATMENT CASE; APPLICATION OF BURDEN SHIFTING ANALYSIS; OFCCP HAS THE ULTIMATE BURDEN OF PROOF--BUT ONCE OFCCP PUTS ON A PRIMA FACIE CASE BASED ON STATISTICAL EVIDENCE--RESPONDENT MUST DO MORE THAN ARTICULATE POSSIBLE REASONS OFCCP’S STATISTICAL EVIDENCE MAY BE FLAWED; RESPONDENT MUST SHOW THAT CURING THE FLAWS WOULD CHANGE THE RESULTING DISPARITY

In OFCCP, USDOL v. WMS Solutions, LLC, ARB No. 2020-0057, ALJ No. 2015-OFC-00009 (ARB Nov. 18, 2021) (per curiam), Respondent was a construction contractor providing demolition, lead, and asbestos mitigation staffing to construction sites.  OFCCP received a complaint about working conditions as a GSA modernization project.  After an investigation, compliance review, and conciliation efforts, OFCCP filed an administrative complaint with OALJ alleging that Respondent violated EO 11246 when it discriminated against non-Hispanic applicants in its hiring, and discriminated against women and non-Hispanics in assigning hours and setting pay during the review period. OFCCP relied upon a theory of intentional disparate treatment at the hearing to prove that Respondent used race and ethnicity as main factors during hiring, and to prove that Respondent discriminated against women and non-Hispanics in assigning hours and pay. 

Discrimination Against Non-Hispanic Applicants

At the hearing, OFCCP relied on both statistical and anecdotal evidence.  OFCCP’s statistician expert approximated the applicant pool using census data because Respondent could only provide incomplete worker candidate profile forms that did not reflect the actual applicant pool or its demographics.  The statistical evidence showed 19.36 standard deviations below the census proportion. The ALJ used this data and other testimony to determine that OFCCP established a prima facie case of intentional discrimination in hiring.  On appeal, the ARB found this determination to be supported by substantial evidence.

Respondent’s rebuttal centered on contentions that Hispanic construction workers are more interested in asbestos removal work than non-Hispanic workers; that Hispanic workers are more likely to have an asbestos license; and such a license was required to be considered for employment.   Respondent presented its own statistician expert’s analysis, which faulted OFCCP’s expert’s analysis for relying on census data that did not account for applicants’ interest in asbestos work, and was overly broad because it was based on the general construction labor pool.  Respondent’s expert used a more localized pool of asbestos licensure data from relevant parts of Virginia, presuming that anyone with a Latino or Hispanic surname to be Hispanic.  Based on this data, Respondent’s expert concluded that 12% of the labor pool was non-Hispanic.  Data from Maryland did not contain ethnicity or race data but did show that 86% took the licensure exam in Spanish.  Respondent’s expert also argued that OFCCP’s expert did not take into account re-hires, or the types of jobs laborers had been hired to perform.

The ARB, however, found that many of Respondent’s theories were unsupported, and that Respondent failed to rebut OFCCP’s prima facie case.  Respondent’s own managers testified that they hired anyone able to work, even if they were not experienced--and that Respondent was affiliated with a training school and offered employees asbestos certification. The ARB found the evidence insufficient to prove that Hispanic workers are more interested in asbestos work that laborers in the general population, or that Hispanic workers are more likely to be licensed upon hire.  The ARB found Respondent’s arguments to have been based on incomplete or unavailable data.

Respondent argued that the ALJ required it to sustain the burden of proof to show that it did not discriminate – that the ALJ only subjected OFCCP’s statistics to a minimum burden of raising an inference – but subjected Respondent’s statistics to intense scrutiny.  The ARB, however, was not persuaded that the ALJ erred:

  •      WMS misunderstands both the burden-shifting framework and the ALJ’s application of it. WMS is correct in asserting that OFCCP always has the burden of proof. Decades of legal precedent consistently demonstrate that OFCCP carries the burden throughout the entire proceeding. WMS’s job is to rebut the evidence OFCCP puts on—as in any typical civil case. Rebuttal in a case relying on statistical evidence is not as simple as articulating possible reasons OFCCP’s statistical analysis may be flawed. WMS needed to show that curing the flaws in the analysis would change the resulting disparity.  Here, it failed to do so. Instead, WMS merely offered piecemeal explanations that either lacked evidence or were directly contradicted by uncontested evidence in the record.

Slip op. at 22 (footnote omitted).

Discrimination Against Female and Non-Hispanic Employees

OFCCP’s expert found the data showed that women and non-Hispanics of both genders were assigned fewer weekly hours than male and Hispanic workers during the review period, and that female laborers received lower hourly wages than male laborers during the review period.  OFCCP also offered testimony from managers to the effect that clients asked for men instead of women because the work was too heavy and hard for women, and women would go to the bathroom more often – thus requiring more frequent removal of the suit, and replacement with a new suit before returning to work.  The ARB found that substantial evidence supported the ALJ’s finding that this evidence established a prima facie case.  The ARB also found supported by record and consistent with law were the ALJ’s conclusions that Respondent’s arguments in rebuttal failed to: 1) call into question the validity of OFCCP’s expert’s statistical conclusions about its discriminatory compensation practices; and 2) provide any reasonable supporting evidence that would result in a different conclusion.  The ALJ also found that Respondent “failed to articulate how client preferences factor into rebutting a prima facie showing of discrimination.”

DAMAGES IN AN E.O. 11246 INTENTIONAL DISPARATE TREATMENT CASE; ALJ DID NOT ABUSE HIS DISCRETION IN AWARDING BACK PAY ON A CLASS-WIDE BASIS FOR INTENTIONAL DISCRIMINATION IN HIRING TO PREFER HISPANIC WORKERS, LOWER PAY TO WOMEN WORKERS, AND LOWER WORK ASSIGNMENTS TO NON-HISPANIC WORKERS; ALJ DID NOT ABUSE HIS DISCRETION IN LIMITING INTEREST ON BACK PAY TO DATE OF THE HEARING RATHER THAN THE DATE OF DECISION, AND IN NOT ORDERING OFFERS OF EMPLOYMENT

In OFCCP, USDOL v. WMS Solutions, LLC, ARB No. 2020-0057, ALJ No. 2015-OFC-00009 (ARB Nov. 18, 2021) (per curiam), both Respondent and OFCCP challenged the ALJ’s damages award.  The ARB reviewed the ALJ’s methodology for awarding damages using a reasonable discretion standard given the complexity of determining back pay compensation.  OFCCP argued that the ALJ erred by not ordering “offers of employment, back pay that extended to the date of the trial due to ongoing discrimination, and interest on back pay until the date of the decision.”  Slip op. at 25.  Respondent argued that the ALJ should not have awarded any damages, and specifically should not have issued class-based damages.

OFCCP’s expert had calculated damages for racially discriminatory hiring, including interest to the date of the hearing.  The ALJ reduced this calculation to account for differences between the re-hire number used by OFCCP’s expert and Respondent’s evidence.  The ALJ adopted OFCCP’s findings in regard to lower hourly pay for women, and for lower assignment of work for no-Hispanic workers.

The ARB found that the ALJ’s award of damages was reasonable, and appropriately designed to make the class of discrimination victims whole.  The ARB found that Respondent had not offered a credible reason to disrupt the award.  The ARB stated that OFCCP correctly pointed out that courts have power to impose substantial remedies, including equitable remedies – but noted that such remedies must be practical and possible.  Here, the ALJ used reasonable and sensible reasoning to find that the appropriate remedy was back pay calculated on a class-wide basis – exactitude not being required.  OFCCP had asked the ALJ to clarify several points about the award, and specifically asked the ALJ to award interest to the date of decision as opposed to hearing date.  The ALJ denied this motion, and the ARB declined to reverse the ALJ, deferring to the ALJ’s discretion on the matter.

Ford v. Plus Way Transportation, Inc., ARB No. 2021-0022, ALJ No. 2016-STA-00061 (ARB Nov. 15, 2021) (per curiam) (Order of Dismissal)

The ARB dismissed for failure to prosecute after Complainant failed to explain in his response to the ARB's order to show cause, why the appeal should not be dismissed for failure to file an opening brief.

Innovair LLC v. Administrator, Wage and Hour Division, ARB No. 2020-0070 (ARB Nov. 12, 2021) (per curiam) (Decision and Order)

WHERE CONTRACTOR BECAME ITS OWN SUCCESSOR WHEN GSA EXTENDED THE CONTRACT EFFECTIVE PRIOR TO THE EFFECTIVE DATE OF A NEW COLLECTIVE BARGAINING AGREEMENT, CONTRACTOR WAS REQUIRED TO NOT PAY LESS THAN THE WAGES AND FRINGE BENEFITS ITS EMPLOYEES WOULD HAVE RECEIVED UNDER THE PREDECESSOR CONTRACT

In Innovair LLC v. Administrator, Wage and Hour Division, ARB No. 2020-0070 (ARB Nov. 12, 2021) (per curiam), the General Service Administration (GSA) and Innovair were parties to a contract to provide aircraft maintenance support at a Marine Corps facility.  The contract had a one year base, and four option periods.  GSA unilaterally extended one the option years.  The extension was exercised after Innovair had negotiated a new collective bargaining agreement (CBA 3).  The new CBA, however, did not go into effect until after the start date of the new option year.  Innovair requested that the Contracting Officer (CO) modify the contract extension rates to account for the wage adjustments that would take effect under the new CBA, but the CO denied an adjustment.  Innovair claimed the denial resulted in over $600,000 in additional costs.

The contractor requested review by the Division of Wage Determinations (DWD).  The DWD found that the request was untimely, and that "that Innovair did not actually pay wages and fringe benefits in accordance with CBA 3 during the term of the predecessor SCA-covered contract, and as a result, were not the SCA-required rates pursuant to Section 4(c)."  Slip op. at 4 (footnote omitted).

The Wage and Hour Division Administrator affirmed the DWD's determination.  The ARB affirmed the Administrator's affirmance of the DWD.  The ARB explained:

  •      Innovair argues on appeal that the Administrator misinterprets 29 C.F.R. § 4.163(f), a regulation that implements Section 4(c). Specifically, Innovair claims that the Administrator’s interpretation is unreasonable because it precludes the effect of a CBA during the term of the successor contract if that CBA was not effective during the predecessor contract term. In response, the Administrator reiterates that under 29 C.F.R. § 4.163(f), a contractor must actually pay its employees in accordance with the CBA applicable to the predecessor contract for Section 4(c) to render that CBA’s rates the required for the successor contract period. Because Innovair did not pay its employees in accordance to CBA 3 during the course of the predecessor contract, the Administrator determined that CBA 3’s wage rates and fringe benefits were not the SCA-required wage rates and fringe benefits during the extension period.
  • * * *
  •      Regulation 29 C.F.R. § 4.163(f) provides that “Section 4(c) will be operative only if the employees who worked on the predecessor contract were actually paid in accordance with the wage and fringe benefit provisions of a predecessor contractor’s [CBA].” Innovair became its own successor when GSA extended the Contract from May 1, 2019, to September 30, 2019. Thus, Innovair was required to not pay less than the wages and fringe benefits its employees would have received under the predecessor contract. CBA 3 was not applicable to the predecessor contract scheduled to expire on April 30, 2019, because Innovair’s obligations under CBA 3 did not commence until May 15, 2019, which was approximately two weeks after the predecessor contract expired. It is uncontested that Innovair did not actually pay its workers in accordance with CBA 3 during the term of the predecessor contract term, which would be required in order to be the SCA-required wage rates and fringe benefits for the successor contract pursuant to Section 4(c). Therefore, we conclude the Administrator acted reasonably and within her discretion finding that CBA 3’s wage rates and fringe benefits were not the required rates for the extension period.

Id. at 6-7 (footnotes omitted).

Judy v. Covenant Transport, Inc., ARB No. 2021-0015, ALJ No. 2019-STA-00054 (ARB Nov. 8, 2021) (per curiam) (Order of Dismissal)

[STAA Digest II B 2 d ii]
TIMELINESS OF COMPLAINT; EQUITABLE TOLLING WAS NOT WARRANTED UNDER THE FACTS OF THE CASE, EVEN ASSUMING OSHA PROVIDED ADVICE TO WITHDRAW THE OSHA STAA COMPLAINT AND TO FILE A LAWSUIT IN FEDERAL COURT, BECAUSE COMPLAINANT WAITED MORE THAN A YEAR AFTER THE WITHDRAWAL TO RETAIN AN ATTORNEY; FACT THAT ATTORNEY FILED THE FEDERAL SUIT UNDER THE WRONG STATUTE DID NOT ESTABLISH EXTRAORDINARY CIRCUMSTANCE WARRANTING TOLLING

In Judy v. Covenant Transport, Inc., ARB No. 2021-0015, ALJ No. 2019-STA-00054 (ARB Nov. 8, 2021) (per curiam), Complainant was fired after he reported to company officials that his superior forced him to drive a rental car from home in Orlando, Florida to a terminal in Chattanooga, Tennessee, even though Complainant reported that he was tired.  On January 23, 2017, Complainant filed a FMCSA complaint reporting his safety concerns, and on the same day filed a complaint with OSHA reporting the same concerns.  OSHA dismissed the complaint on March 13, 2017, finding that it did not have jurisdiction.  On May 8, 2017, Complainant filed a second complaint with OSHA alleging that he was fired for engaging in protected activity in violation of the STAA.  OSHA closed the complaint on June 15, 2017 based on Complainant’s voluntary withdrawal.  In 2018, Complainant hired an attorney who filed a lawsuit on Complainant’s behalf in Federal court.  The attorney, however, filed the complaint under the wrong statute.  In January 2019, Complainant spoke to an OSHA official, who told Complainant to refile his OSHA complaint, which Complainant did on January 25, 2019.  On May 3, 2019 OSHA dismissed the complaint as untimely.   Complainant then requested an ALJ hearing.  In response to an Order to Show Cause, Complainant argued that equitable tolling applied because he filed his claim in the wrong forum, and because OSHA misled him into withdrawing his complaint.   The presiding ALJ, however, found that Complainant did not establish that equitable tolling was warranted. 

On appeal, the ARB found that the record showed that Complainant failed to exercise due diligence.  Although Complainant alleged that an OSHA investigator advised him to withdraw the administrative claim voluntarily and to file a Federal lawsuit, he did not retain legal representation until well over a year after he withdrew the OSHA complaint.  Although Complainant’s counsel filed the lawsuit under the wrong statute, this circumstance did not support tolling, as attorney error does not establish an extraordinary factor justifying equitable tolling.  As to the wrong forum filing with the FMCSA argument, the ARB found that the ALJ had correctly found that this ground for equitable tolling did not apply, because Complainant had simultaneously filed a complaint with OSHA.

Office of Federal Contract Compliance Programs, USDOL v. Enterprise RAC Company of Baltimore, LLC,  ARB No. 2019-0072, ALJ No. 2016-OFC-00006 (ARB Nov. 3, 2021) (per curiam) (Order of Remand)

DISPARATE TREATMENT ORDER OF PROOF; ALJ ERRED AS A MATTER OF LAW BY EMPLOYING BURDEN OF PERSUASION ANALYSIS TO DEFENDANT'S PROFFER OF LEGITIMATE, NON-DISCRIMINATORY REASONS FOR REJECTION OF JOB APPLICANTS; AT THAT POINT IN THE ORDER OF PROOF, DEFENDANT'S ONLY BURDEN WAS OF PRODUCTION AND NOT PERSUASION

DISPARATE IMPACT; ALJ'S CURSORY ANALYSIS OF THE REQUIREMENTS FOR A DISPARATE IMPACT CASE REQUIRED A REMAND 

In Office of Federal Contract Compliance Programs, USDOL v. Enterprise RAC Company of Baltimore, LLC,  ARB No. 2019-0072, ALJ No. 2016-OFC-00006 (ARB Nov. 3, 2021) (per curiam), Defendant appealed the ALJ’s finding that it was liable under Executive Order (EO) 11246 for intentional and unlawful discrimination against African-American job applicants.  The ARB found that the ALJ had erred in both his disparate treatment and disparate impact analyses.

As to disparate treatment, OFCCP met its initial burden by producing statistical evidence establishing a racial disparity sufficient to create a prima facie case of racial discrimination.  Defendant was unable to establish that OFCCP's statistical evidence was unsound, so it instead articulated nondiscriminatory reasons for rejecting applicants for the management trainee position at issue.

The ARB noted that Defendant's burden at this point was one of production, not persuasion. The ARB found that, although the ALJ had recited this burden correctly, he nonetheless conducted a persuasion analysis.  The ALJ had found that Defendant’s evidence showed subjectivity used by recruiters to reject applicants, and that disposition codes were used inconsistently.  The ALJ had not explained, however, why Defendant’s documentation explaining the racial disparities shown in the statistical evidence did not meet its burden of production.  The ARB also found that the ALJ's analysis on the burden of persuasion was flawed, the ALJ having conflated evidence of subjectivity with evidence of discrimination without allowing an employer’s legitimate use of subjective hiring criteria.  The ARB noted that subjective evaluation criteria can constitute legally sufficient, legitimate, nondiscriminatory reasons for business decisions, albeit subjective criteria are not beyond scrutiny.

As to disparate impact, the ARB found that the ALJ's review of the alleged form of discrimination had been cursory and without the necessary analysis for disparate impact liability.  The ARB stated that the ALJ "failed to identify what specific employment practice caused the disparate impact and failed to adequately discuss the issue of the respondent’s possible defenses to the prima facie case (i.e. job relatedness or business necessity), and whether there was an alternative practice which could have served the same purposes of the practice with a lesser disparate impact."  Slip op. at 13-14.  The ARB noted that these requirements are clearly stated in applicable statutes and case law.

One member of the Board filed a concurring opinion in which he elaborated on the reasons for remand, and noted one area where he differed slightly from the majority opinion.  The area of difference regarded the application of the McDonnnell Douglas-Burdine tripartite order of proof, on which the concurring ARB member noted a lack of clarity in the law as to application of the order of proof in bench trials.

Rew v. CSX Transportation, Inc., ARB Nos. 2021-0042 -0058, ALJ No. 2019-FRS-00073 (ARB Nov. 2, 2021) (per curiam) (Decision and Order Approving Settlement and Dismissing Case with Prejudice)

The ARB approved the parties' settlement agreement as fair, adequate, and reasonable, and not in contravention of the public interest.

Boles v. Union Pacific Railroad Co., ARB No. 2021-0061, ALJ No. 2020-FRS-00101 (ARB Nov. 1, 2021) (per curiam) (Decision and Order Dismissing Petition for Review)

UNTIMELY PETITION FOR REVIEW; EXTRAORDINARY CIRCUMSTANCES WARRANTING EQUITABLE TOLLING WERE NOT ESTABLISHED BASED ON CONTENTIONS THAT ALJ ONLY SERVED COMPLAINANT’S COUNSEL; THAT ALJ’S D&O DID NOT INCLUDE A NOTICE OF APPEAL RIGHTS; THAT COMPLAINANT ATTEMPTED UNSUCCESSFULLY TO CONTACT DOL REPRESENTATIVES ON APPELLATE PROCEDURE; THAT COMPLAINANT WAS SEARCHING FOR NEW COUNSEL; THAT COMPLAINANT DID NOT HAVE A COPY OF THE HEARING TRANSCRIPT

In Boles v. Union Pacific Railroad Co., ARB No. 2021-0061, ALJ No. 2020-FRS-00101 (ARB Nov. 1, 2021) (per curiam), the ARB dismissed Complainant's untimely Petition for Review, finding that Complainant failed to establish grounds for equitable tolling.  Complainant had been represented by counsel before the ALJ.  Complainant and his counsel, however, did not have an agreement to represent him in an appeal, and Complainant was self-represented before the ARB.

Complainant's response to the Board's Order to Show Cause why the untimely appeal should not be dismissed did not fit any of the four standard situations where equitable tolling may be applied, so the ARB applied an extraordinary circumstances standard to Complainant's arguments.

Complainant first argued that he was prevented from timely appealing because he did not receive a paper copy of the ALJ's Decision and Order (D&O) directly from the ALJ.  The ARB found that this was not an extraordinary circumstance justifying tolling because the D&O was timely served on Complainant's attorney, and that attorney had promptly e-mailed the decision to Complainant.  The ARB stated: "As a matter of law, proper notice to a party’s representative is deemed to be actual notice to the party himself."  Slip op. at 4 (footnoted omitted).  In addition, the ARB noted that Complainant had not disputed that his counsel delivered an electronic copy to him well before the filing deadline -- and that Complainant had not claimed that he was unable to access the decision in its electronic form.

Complainant argued that he did not know the applicable procedures and rules, and noted that the ALJ had not included instructions on how to do so in the D&O.  The ARB noted that ignorance of legal rights does not toll a statute of limitations, and that although it would have been helpful for the ALL to have included a notice of appeal rights, there is no statute or regulation requiring such.  

Complainant also argued that he made repeated unsuccessful attempts to contact DOL representatives about the appeal procedures.  The ARB, however, found no indication that Complainant attempted to contact the ARB itself before the filing deadline.  The ARB also found the documentation on the asserted contacts was equivocal, and insufficient to establish extraordinary circumstances.  The ARB also noted that when Complainant's counsel e-mailed the ALJ's D&O to Complainant, he specifically informed Complainant about the filing deadline.  The ARB noted that its website explains how to file a petition for review electronically or by mail.

Complainant argued that he was struggling to find new legal counsel in the weeks after the ALJ issued the D&O.  The ARB, however, stated that "it is well recognized that a Complainant’s inability to find a new representative does not constitute an extraordinary circumstance that would support an equitable tolling of the filing deadline."  Id. at 5 (footnote omitted).

Finally, Complainant argued that he was unable to file a timely appeal because he had not received a copy of the hearing transcript.  The ARB found that this was not an extraordinary circumstance warranting equitable tolling, and that if Complainant believed the transcript was essential to his ability to file a petition, he should have asked for an extension of the filing deadline.