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Labor Department Questions Microsoft and Wells Fargo Over Pledges to Hire More Black Employees
Agency letters ask if diversity initiatives constitute discriminaton; companies say they comply with employment law
Microsoft Corp. and Wells Fargo & Co. were contacted last week by the U.S. Labor Department questioning their plans to hire more Black employees as they seek to diversify their management ranks.Microsoft said the agency overseeing federal contractors is questioning whether its June pledge to double the number of Black managers and leaders in its U.S. workforce by 2025 violates federal laws prohibiting discrimination based on race.
“We have every confidence that Microsoft’s diversity initiative complies fully with all U.S. employment laws,” Microsoft general counsel Dev Stahlkopf said in a blog post.
Wells Fargo in June pledged to double Black leaders at the bank over the next five years. It recently received a letter from the same agency reminding the bank that it may not discriminate on the basis of race to provide additional opportunities and that quotas are prohibited.
A Wells Fargo spokesman said the bank “is committed to and taking action to become a more diverse and inclusive company. Numerous efforts are under way to implement changes at all levels of the company, and we are confident that they comply with U.S. employment laws.”
Black employees represent about 4.5% of Microsoft’s U.S. workforce and less than 3% of senior roles, according to the company’s 2019 diversity report. At Wells Fargo, Black employees are currently 6% of senior management. That compares with about 13% of the U.S. population.
After the killing of George Floyd in May and calls for racial equality, Microsoft and Wells Fargo were among several companies, from Germany’s Adidas AG to Silicon Valley’s Facebook Inc., to make pledges to hire more Black employees.
In a Sept. 29 letter to Microsoft, Craig Leen, director of the Office of Federal Contract Compliance Programs, said this initiative “appears to imply that employment action may be taken on the basis of race.” The letter asked Microsoft to prove the actions it is taking aren’t illegal race-based decisions. The letter to Wells Fargo is also dated Sept. 29.
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