Labor & Employment Law Daily Enterprise Rent-A-Car must pay $6.6M+ in back wages for discriminating against African-American applicants
Monday, August 5, 2019

Enterprise Rent-A-Car must pay $6.6M+ in back wages for discriminating against African-American applicants

By Pamela Wolf, J.D.

Back wages with benefits and interest will be updated to the present; job offers also must be given to 182 rejected applicants with pay to the date of rejection, making the total relief at least $16.3 million.

The Office of Federal Contract Compliance Programs is touting a $6.6 million-plus award ordered by an administrative law judge who found that Enterprise RAC Company of Baltimore LLC had engaged in a pattern and practice of discriminating against African-American applicants for entry-level management jobs in the Baltimore area over a 10-year period. The OFCCP said it’s the largest back wage award in its history.

Following an OFCCP investigation, the ALJ ordered the Linthicum, Maryland-based federal contractor to pay $6,645,444 in lost earnings and benefits to 2,336 African-American applicants for the rent-a-car company’s management trainee program.

White applicants favored. The order found that Enterprise violated Executive Order 11246 by discriminating against African-American applicants in favor of white applicants for its management trainee program from August 1, 2007, through July 31, 2012, and from August 1, 2013, through July 31, 2017.

Total relief worth $16.3 million. The ALJ ordered Enterprise to pay back wages with benefits and interest updated to the present, which will be at least $7.2 million, according to the OFCCP. Enterprise must also extend job offers to 182 of the rejected African-American applicants by July 31, 2021, including pay as if they had been hired at the time of their rejection. The value of these 182 new hires will be at least $9.1 million, the OFCCP calculated, making the total recovery in earnings, benefits, and interest at least $16.3 million.

Debarment. Based on Enterprise’s years-long discriminatory hiring practices, the judge in addition ordered the indefinite debarment of the company from current and future government contracts until it agrees to implement specific steps to address the effects of past discrimination and prevent it from occurring in the future. The ALJ based the debarment ruling in part on internal audits conducted by Enterprise, which showed that its hiring practices had an ongoing disparate impact on minority applicants since 2007, and the company’s decision to take no steps to address that pattern and practice of racial discrimination.

“Government contractors must monitor their hiring process to ensure that applicants are not rejected based on discrimination or biases,” OFCCP Regional Director Michele Hodge explained. “When an employer like Enterprise finds that it’s hiring process are discriminatory, that employer must make corrections to its process to ensure equal employment opportunity for all applicants.”

“The judge’s order stands for fairness in employment, and sends a clear message of the serious costs of hiring discrimination,” said DOL Regional Solicitor Oscar L. Hampton III.

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