Silicon Valley Software Supplier Hit With Federal Labor Lawsuit

Palo Alto, CAA somewhat unusual California labor lawsuit was filed in recent months by the US Department of Labor (DOL) against a California software company based in Silicon valley. At issue in the lawsuit is alleged discrimination against Asian applicants for jobs with the firm. The DOL asserts that such discrimination is systematic.

The defendant in the California labor law litigation is Palantir Technologies, a fast-growing and privately-held software company valued at $20 billion that designs, manufactures and vends data-analytics software used by high-end clients.

According to a report by the Associated Press (AP 09/26/16), the feds investigated the California software company when Asian, and Asian-Americans applied for positions, and posted jobs in large numbers.

To illustrate, a handful of jobs described as ‘quality assurance engineer’ attracted no fewer than 730 qualified applicants. Of that applicant pool, 77 percent of applicants were of Asian descent. At the end of the hiring process, the government investigation determined that seven applicants were hired in the end, comprised of one Asian and six non-Asians.

The DOL’s compliance office determined that the statistical likelihood of that happening naturally, is one in 741. With regard to one other position analyzed by the DOL, a job described as an engineering intern, the California labor code lawsuit noted that the hiring pattern observed by the defendant for a hire that went to a non-Asian, was a “one in a billion” chance it might have happened purely by chance.

The DOL launched the investigation in response to a statistical analysis in order to ensure the defendant was complying with anti-discrimination rules for suppliers of goods and services to the federal government. Palantir, according to AP, supplies software to the US military, intelligence and law enforcement agencies – amongst other, non-governmental clients.

Palantir, based in Palo Alto, employs more than 1800 people.

“It’s the new economy, but we still want to make sure there aren’t new forms of discrimination in these industries,” said Orly Lobel, a University of San Diego law professor who has studied Silicon Valley hiring patterns, in comments to the Associated Press.

“You used to have ‘smoking guns,’ but that’s more rare these days,” she said. “So the courts are recognizing that you can prove discrimination by showing that the odds that this would be the result, without discrimination, are just so low.”

It should be noted that the California labor lawsuit was based on statistical evidence from 2010 and 2011. However, a senior trial attorney with the DOL noted in the AP report that there had been no evidence of any change in hiring practices on the part of the defendant since that time.

Another California-based supplier to the federal government, Hewlett Packard Enterprise (HPE), was also brought to face discrimination claims by the DOL. That California labor employment lawsuit was recently settled for $750,000 in payment of back wages without HPE required to admit to any wrongdoing.

Palantir was described in the AP report as having denied the allegations, arguing in a statement released to the media that the federal lawsuit – which Palantir intends to contest “vigorously” – “relies on a narrow and flawed statistical analysis relating to three job descriptions between 2010 to 2011.”

The lawsuit is Office of Federal Contract Compliance Programs, United States Department Of Labor v. Palantir Technologies, Inc. before the United States Department of Labor Office of Administrative Law Judges. Further case information was not available.