On September 27, 2013, Baltimore Gas & Electric Company (“BGE”) announced that it entered into a conciliation agreement with the Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”) to settle claims of racial bias in its hiring practices.  OFCCP did not announce the settlement prior to suspending operations due to the government shutdown.

As reported by BGE, OFCCP found in a 2009 compliance review that BGE discriminated against African Americans who applied to three utility trainee job categories between December 2007 and November 2008.  BGE attributes these findings to an overreliance on employee referrals in the recruitment process.  Under the conciliation agreement, BGE will pay $350,000 in back wages and interest to 58 class members.  Further, BGE agreed to hire up to six class members for the utility trainee positions.

The BGE conciliation agreement highlights the importance of posting open positions and adopting uniform, nondiscriminatory hiring practices subject to internal control and review.  It is critical that contractors undertake periodic self-audits to identify potential disparities in hiring and barriers to the hiring and promotion of individuals in protected classes.