US authorities accuse Oracle of systematic discrimination against minorities

23 Jan 2019

Oracle headquarters in California. Image: wolterke/Depositphotos

Software giant Oracle stands accused of wage discrimination that cost women and minorities $400m.

US government regulators alleged that software player Oracle engaged in discriminatory practices that left many of its black, Asian and women employees underpaid by more than $400m.

According to CNBC, the new federal filing expands on a lawsuit that began in 2017, which was filed by the US Department of Labor (DoL). This suit alleged that the company paid white male workers more than their peers who were women or people of colour.

Proceedings were stayed that same year to allow Oracle and the department to mediate the issue, but now the DoL is renewing its claims that the firm discriminates in how it both hires and compensates staff.

Discriminatory practices at Oracle

The complaint said that out of approximately 500 individuals hired into technical jobs over four years, only six were African American, while five were Hispanic.

The DoL alleged that more than 11,000 Asian Oracle employees had been paid as much as 8pc less compared to their white counterparts. Underpayment of women has also been alleged, with disparities alleged to be as high as 20pc.

The filing said that Oracle’s “suppression of pay for its non-white, non-male employees is so extreme that it persists and gets worse over long careers”.

The DoL is asking US courts to pay lost wages and remedy discriminatory hiring and compensation practices. It also said it has reason to believe the California-headquartered company has not adopted any of its suggested reforms and that Oracle may owe more than the estimated $400m.

Two strategies

The software provider allegedly used two strategies to carry out its discriminatory actions. The first involved setting base pay in relation to prior salary and the second is said to involve funnelling these groups into career paths that paid less.

The complaint states: “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.”

The DoL also alleged that Oracle has a strong preference for hiring Asian recent graduates, adding that it preferred to take on Asian visa-holders, which the complaint said “lends itself to suppression of that workforce’s wages”.

Perhaps most dramatically, the complaint alleges that Oracle “destroyed records” connected to its hiring process while the case was underway.

Oracle headquarters in California. Image: wolterke/Depositphotos

Ellen Tannam was a journalist with Silicon Republic, covering all manner of business and tech subjects