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August 3, 2017Client Alert

Google Claims Partial Victory over OFCCP: Why You Should Care

On July 14, 2017, an Administrative Law Judge (ALJ) with the U.S. Department of Labor handed Google a partial victory over the Office of Federal Contract Compliance Programs (OFCCP) in their ongoing row over OFCCP’s audit of Google, which began in September 2015. Up until June 2016, Google had complied with all of OFCCP’s information requests, producing over 1 million data points and approximately 740,000 pages. This production cost Google approximately $500,000 and 2,300 man hours.

In June 2016, OFCCP sent Google two letters requesting a large amount of information and materials. This request came after Google had already provided an incredibly large volume of documents requested during the audit. Google complied with all but three of OFCCP’s requests: (1) a salary history for every person employed by Google during two snapshot periods, going back to each person’s date of hire (which for some extended back to 1998); (2) another snapshot period that included not only the OMB-approved list of information, but also an additional 38 categories for each of the 19,539 people employed by Google on September 1, 2014; and, (3) the name, address, telephone number, and personal email of every employee reflected on either of the two snapshots.

In support of its broad requests, OFCCP told the ALJ that it needed to “look at every decision that impacted pay” to find the cause of its preliminary finding of sex-based pay disparity in Google’s pay practices. The ALJ, however, found a number of holes in the OFCCP’s testimony, namely that Deputy Regional Director Suhr did not have a “full and accurate understanding . . . of how Google sets its starting salaries.”

Ultimately, the ALJ only granted some of OFCCP’s information requests (and limited the scope of those requests), stating that “OFCCP has not taken sufficient steps to learn how Google’s system works, identify actual policies and practices that might cause the disparity, and then craft focused requests for information that bears on these identified potential causes. Without this, the requests become unreasonable: unfocused, irrelevant, and unduly burdensome.”

Google’s partial victory over OFCCP demonstrates that employers can successfully resist overly broad information requests during OFCCP audits. The case also highlights the intricacies, difficulties, and OFCCP’s investigative shortcomings in pay discrimination audits and that compensation data continues to be a major focus of the OFCCP. Employers should continue to practice good record retention policies and continue conducting compensation analyses under attorney-client privilege in order to be prepared if and when the OFCCP comes knocking.

For more compensation data news, see our alert on the EEO-1 report and VETS-4212 reporting.

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