OFCCP Announces $4 Million Settlement With JBS To Resolve Two Administrative Lawsuits Alleging Hiring Discrimination; Settlement Includes Unique “Enhanced Compliance Agreement”

The Labor Department’s Office of Federal Contract Compliance Programs (OFCCP) has reached settlement terms with JBS USA Lux S.A. (JBS) to resolve hiring discrimination claims arising from two separate compliance evaluations, covering a period from August 2005 through December 2016. In two separate administrative lawsuits, OFCCP had alleged that the company was discriminating against female, White, African American, American Indian/Alaska Native, and Hispanic applicants applying for General Production/Laborer positions at the company’s Hyrum, Utah and Cactus, Texas beef processing and packaging facilities.

The settlement is in the form of a consent decree, with JBS agreeing to pay $4 million in back pay to more than 12,000 class members at the Hyrum and Cactus facilities and extend job offers to up to 1,664 applicants. And while the settlement contains many of the hallmarks of a routine hiring settlement, such as revised hiring processes, training, and periodic reporting to OFCCP, the parties also agreed to a unique, five-year “Enhanced Compliance Agreement.”

Under the Enhanced Compliance Agreement, JBS must, among other things, hire a consultant to evaluate the hiring policies and procedures at all of its U.S. facilities that employ General Production/Laborer workers, conduct semi-annual adverse impact analyses, and provide OFCCP with a progress report every six months for the next five years. In exchange, OFCCP has agreed not to schedule any JBS facilities for a compliance review, except to investigate discrimination complaints filed by applicants or employees.

Notably, the OFCCP/JBS Enhanced Compliance Agreement appears to be modeled on OFCCP’s very recently issued directive implementing Early Resolution Procedures.

We should note that as with all OFCCP settlements, the JBS consent decree contains no admission of guilt. Indeed, a contractor often will settle simply to avoid the burden and cost of potentially protracted litigation, especially where the agency is amenable to reaching a resolution.

Members of the Center for Workplace Compliance (CWC) can read more here.