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OFCCP and Merit Services Inc. Enter Into Conciliation Agreement to Resolve Hiring Discrimination Claims

By OutSolve - Sep 20, 2021 4:36:15 PM - 2 MINS READ

Merit agreed to pay $295,000 and offer 46 future opportunities for findings that were identified in a compliance review in November 2013

During a routine compliance evaluation that began in November 2013, OFCCP alleged the Merit Services Inc., a manufacturer of disposable medical devices, discriminated against 1,680 male applicants for Production Operator II positions at its South Jordan Utah facility. OFCCP issued the Pre-Determination Notice (PDN) in October 2018 and the Notice of Violations (NOV) on September 26, 2019.

To resolve the allegations, Merit Services entered into a conciliation agreement and agreed to pay $295,000 in back wages and provide job opportunities to 46 of the affected applicants as positions become available in the greater Salt Lake City area. The company will also ensure that its personnel practices, including record-keeping and internal auditing procedures, are legally compliant.

Press release

OutSolve OFCCP Insights

OutSolve’s Take

The compliance evaluation on which this Conciliation Agreement (CA) is based began in November of 2013, and extended back to November of 2011, ten years ago. The CA alleges that over the two years of the review period, the OFCCP determined that 46 more males should have been hired, 26 per year, slightly more than two per month on average.

A settlement fund that was “negotiated” includes $270,000 in back pay, with $25,000 in interest accrued over eight years. The OFCCP identified 1,680 applicants who are entitled to a share of the settlement fund. If all identified applicants come forward for their share, that works out to $175.60 for each applicant.

The CA makes quite clear that Merit failed to maintain records of its hiring decisions. As the CA has it, “Merit neither found nor addressed the selection disparities that resulted from its personnel procedures, and did not maintain and have available records or other information showing which individual components of the total selection process had an adverse impact.”

Once again, it’s important to stress that not only do clients need to maintain applicant flow and hiring records, with disposition information, but also to use those records to pre-emptively identify indications of potential disparate impact against any group, and at any stage of the hiring process, if they expect to defend themselves against OFCCP’s allegations of discrimination. If you’d like additional information, please reach out to us at info@outsolve.com.

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