Equal Employment Opportunity Commission (EEOC) v. Paramount Staffing

In this class action, the EEOC alleged that Paramount Staffing failed to place a class of African Americans into warehouse positions because of their race and their national origin, American, when it took over operations from a predecessor company. Instead, it allegedly preferred placing Hispanic workers. The EEOC also alleged that a former employee was terminated from a warehouse job in retaliation for complaining about the alleged discrimination.

David Sharp (prior to joining Econ One) was retained by the EEOC to statistically analyze Paramount Staffing’s placement of temporary workers into unskilled positions at the relevant facility.  Because the defendant did not provide either applicant flow data or race/ethnicity identifiers of employees, Dr. Sharp’s report, by necessity, relied upon external labor pools and a surname analysis used to identify Hispanic hires. His expert report found consistent over-representation of Hispanic placements at the relevant facility relative to the external labor pools. Dr Sharp also submitted a report responding to the defendant’s expert and provided testimony by deposition.  Dr. Sharp testified at a Daubert hearing regarding the defendant’s challenge to his usage of the surname analysis and external labor pools. However, since the defendant had not provided either applicant flow data or race/ethnicity identifiers of employees, the judge concluded that the plaintiff class could not be penalized for a problem that the defendant created.  After Dr. Sharp’s testimony withstood the Daubert challenge, the defendant settled the case by signing a consent decree and compensating the class of African American applicants.