7C04 Retroactive Seniority

a. Seniority as an Element of Make-Whole Relief. Seniority is often a critical component of relief. Without seniority, an individual who the contractor hires or promotes as a remedy for past discrimination may not have the level of protection against layoff or demotion to which he or she is entitled. If the contractor had hired or promoted him or her at the time the discriminatory act occurred, he or she would have had additional years of seniority and would be less vulnerable to layoff as a result. Therefore, requiring hiring or promotion as a remedy without also requiring an adjustment of seniority does not really make the victim whole. Similarly, in many situations, employers award promotions in whole or in part based upon the bidder’s seniority. Merely placing a victim in the workforce without the seniority to which he or she is entitled will delay his or her attainment of his or her rightful place. Victims should receive all relevant seniority they have lost as a result of the discrimination, such as job seniority where relevant, in addition to company seniority.

b. Competitive and Noncompetitive Seniority. There are two types of seniority: competitive and noncompetitive. Competitive seniority may include seniority for the purposes of shift preference, vacation schedules, promotions, job bidding, layoffs, raises or training. When retroactive competitive seniority is fashioned as a form of relief, the employees who were not victims could effectively lose out in bidding for jobs or be in greater danger of layoff, etc., than those who received retroactive seniority. On the other hand, there are some types of noncompetitive seniority matters (e.g., accrued leave, retirement computation) that, when remedied for individual victims, do not create the same concerns as remedying for competitive seniority issues. COs should consider the benefits and drawbacks of both types of seniority in their particular case when fashioning a remedy.

c. Nonunion Seniority. Some nonunion contractors operate under a system in which seniority is used in both the competitive and noncompetitive context. In other words, even without a union contract, promotions and layoffs, etc., are decided on the basis of seniority. In these situations, the victim is clearly entitled to obtain retroactive competitive seniority.

d. Union Involvement. When part of the remedy includes retroactive seniority, and a union agreement governs seniority, it is important to involve the union in the conciliation discussions on seniority. Although OFCCP generally does not have jurisdiction over unions, if the union consents to retroactive seniority in the CA, the agreement will be enforceable. If the union is not involved in the conciliation efforts or does not consent, the seniority relief may not be enforceable. If the union refuses to participate in the conciliation process or agree to seniority relief, the CO and his or her supervisor, in coordination with their regional office, should consult their RSOL.

e. Procedures When Union is Involved.

1. Union Participates and Consents. OFCCP will invite the union to participate in conciliation of a violation that requires a retroactive seniority remedy. The CO will make every effort to involve the union in the conciliation process and get its consent to the award of retroactive seniority. If the union participates and agrees to the seniority remedy, then OFCCP can enforce the remedy. If the CO invites the union to participate in the conciliation of seniority issues, its role is limited to those issues. The union should not be involved in other remedy areas (e.g., in determining back pay, changing the selection process).

2. Union Refuses to Participate or Consent. If the union declines to participate in conciliation or otherwise does not consent to an award of retroactive seniority, OFCCP may not be able to enforce any retroactive seniority relief. OFCCP should seek to lay the groundwork to defend its insistence upon seniority relief. In other words, OFCCP should not agree to the usual boilerplate language that says that the contractor does not admit to violating one or more of the provisions in Executive Order 11246, Section 503 or VEVRAA. Instead, the CA should recite the factual bases for OFCCP’s findings of violation. Under these circumstances: (a) the nonadmissions clause is not included in the CA, and (b) paragraph 1 of the General Provisions of the CA will note that the union was invited to participate, but declined to do so or to otherwise consent to an award of retroactive seniority, as applicable.

3. Contractor Refuses to Sign. If a contractor refuses to sign a CA for any reason, including the fact that the CA does not contain the nonadmission language, OFCCP should inform the contractor that this failure to conciliate could result in referral for enforcement.366

f. Other Methods for Addressing Retroactive Seniority

1. Bifurcation. One method to avoid union objection is to bifurcate the competitive and noncompetitive seniority issues. Since the union most likely will not object to the award of noncompetitive seniority, this may be a viable option for resolution.

2. Cash Buyouts. To address competitive seniority issues, some contractors propose a cash buyout of employee seniority rights. In other words, the contractor offers a lump sum payment to identified victims of discrimination (i.e., those who are not hired) in exchange for a waiver of their entitlement to competitive seniority. Seniority buyouts are technically possible, but the CO must carefully craft and review such proposals’ fairness. The CO, in coordination with his or her supervisor and RSOL, must forward offers of seniority buy-outs to the national office, DPO, for review and approval.

366. See Chapter 8 – Resolution of Noncompliance.