U.S. Department of Labor sues Palantir for racial discrimination

The U.S. Department of Labor is suing Palantir Technologies, the software and data analysis company contracted by the federal government, for alleged racial discrimination against Asian people in its hiring and selection processes. The aim of the lawsuit is to put an end to Palantir‘s alleged discriminatory hiring practices, according to a release the Department of Labor put out today. The suit also seeks relief for those affected through the means of lost wages, interest, retroactive seniority and all other lost benefits of employment.

The suit comes after compliance review by the Office of Federal Contract Compliance Programs. The office’s review determined that Palantir has violated Executive Order 11246, which details equal employment opportunities and non-discriminatory practices, from January 2010 to the present day. Palantir allegedly used a hiring process that discriminated against Asian applicants for software engineering roles, “routinely eliminated” qualified Asian applicants in the resume screening and telephone interview phases and hired a majority of people from its discriminatory employee referral system.

In one example cited in the lawsuit, the Labor Department says Palantir hired 14 non-Asian applicants and 11 Asian applicants from a pool of more than 1,160 qualified people, 85 percent of whom were Asian. The likelihood of that happening from chance is one in 3.4 million, according to the lawsuit.

“Federal contractors have an obligation to ensure that their hiring practices and policies are free of all forms of discrimination,” OFCCP Director Patricia Shiu said in a statement. “Our nation’s taxpayers deserve to know that companies employed with public funds are providing equal opportunity for job seekers.”

Following the review, the OFCCP asked for Palantir’s voluntarily compliance in resolving the issues found in the review. Palantir declined to comply, which is when the Labor Department filed the suit.

The federal government has contracted services from Palantir since January 2010. Those contracts are worth $340 million, according to the lawsuit. If Palantir fails to provide relief to those affected, the company stands to lose those contracts with the FBI, the U.S. Special Operations Command and the Army. Palantir has raised over $2.3 billion from investors and was valued at $20 billion during its last institutional round.

I’ve reached out to Palantir and will update this story if I hear back. For now, here’s what Palantir CEO Alex Karp says about diversity on the company’s site:

“Talented and ethical people come from all walks of life, and anyone talented and ethical is welcome here.”