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Department of Labor accuses Oracle of discrimination that cost women and people of color $400 million

Key Points
  • In a new federal filing Tuesday, the Department of Labor claimed Oracle's alleged discriminatory practices cost women and minorities an estimated $400 million.
  • The complaint builds upon a 2017 lawsuit the Department of Labor filed against the company.
  • The complaint alleges Oracle used discriminatory hiring and compensation practices and later destroyed evidence.
Mark Hurd, co-chief executive officer of Oracle Corp., speaks during the Oracle OpenWorld 2018 conference in San Francisco, California, U.S., on Tuesday, Oct. 23, 2018.
David Paul Morris | Bloomberg | Getty Images

The U.S. Labor Department accused Oracle of wage discrimination practices that cost female and minority employees $400 million, according to a new federal filing Tuesday.

The new complaint builds upon a 2017 lawsuit the DoL's Office of Federal Contract Compliance filed in 2017 alleging Oracle systematically paid white male workers more than their peers who were women or people of color. The suit was stayed later that year to allow the Department of Labor and Oracle to mediate the dispute. The Department of Labor is now renewing its claims that Oracle discriminates in its compensation and hiring practices and even alleges the company destroyed evidence.

Oracle Executive Vice President and General Counsel Dorian Daley said in a statement Wednesday,  "This meritless lawsuit is based on false allegations and a seriously flawed process within the OFCCP that relies on cherry picked statistics rather than reality. We fiercely disagree with the spurious claims and will continue in the process to prove them false. We are in compliance with our regulatory obligations, committed to equality, and proud of our employees."

The Department of Labor alleges that Oracle used two methods to discriminate against women and people of color at the company. The first involved allegedly setting initial pay based on prior salary and the second allegedly involved "channeling" these groups into career tracks that would have lower pay.

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The complaint alleges "Oracle suppressed starting salaries for its female and non-White employees, assigned them to lower level positions and depressed their wages over the years they worked at Oracle." These practices caused the employees to miss out on a total of $400 million in compensation, the Department of Labor said in the filing.

The Department of Labor also alleged Oracle has a strong preference for hiring Asian recent college graduates, saying about 90 percent of its 500 college and university hires between 2013 and 2016 were Asian, while the overall targeted college and university population is about 65 percent Asian. The complaint alleges Oracle preferred hiring Asian visa-holders, more specifically, which it says "lends itself to suppression of that workforce's wages" since visa-holders are dependent on Oracle for work authorization in the U.S.

The complaint also alleges Oracle "destroyed records relating to its hiring process as the case was ongoing."

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