Following recent settlements by IBM and Deloitte, the Department of Justice (DOJ) announced this week an agreement with Accenture Federal Services, Accenture plc and Accenture LLP (collectively Accenture) to resolve alleged false certification related to EEO compliance under the False Claims Act (FCA). While denying any wrongdoing, Accenture has agreed to pay $25 Million to settle the allegations that the company falsely certified compliance with contractual anti-discrimination provisions of their federal contracts while allegedly engaging in race- and sex- based hiring, promotion and training practices.
Like earlier “illegal DEI” settlements under the FCA, the DOJ settlement with Accenture highlighted employment practices that this Administration has alleged violate federal civil rights laws, including:
Of important note is that these allegations are not necessarily recent but go back to at least 2017. This is similar to the allegation time frame in the Deloitte settlement, signaling a longer look-back period for these cases. The timeframe also highlights that the DOJ is using the FCA to target conduct under existing equal opportunity laws, rather than waiting for brand-new mandates or contract certifications required by recent Executive Orders signed by this Administration.
Also, like other settlements, this settlement does not limit the Equal Employment Opportunity Commission (EEOC) from investigating and litigating claims against Accenture, including claims that are part of the settlement. This is important because the DOJ settlement does not include payments to any individuals who may have been harmed by Accenture’s alleged discriminatory practices. Federal contractors should closely monitor whether these FCA settlements are followed by EEOC investigations or lawsuits, which could result in additional monetary exposure.
The settlement also relies on the same FAR clause as earlier anti-DEI settlements under the FCA: FAR clause 52.222-26. This FAR clause related to the now-revoked Executive Order 11246 but also included broad language requiring that a contractor agree it would not discriminate against any employee or applicant for employment because of race, sex or other bases protected by federal law.
The government’s theory in all of these settlements is the same. As a government contractor, a company is required to sign off on certain representations and certifications, including the one noted above during the period covered by these settlements. When a company certifies that it is compliant with these requirements and seeks payment under the contract, they can be found to be in violation of the FCA if their certifications were knowingly false and were material to the government’s payment obligations under the contract.
With the Accenture settlement, the DOJ has now recovered more than $63 million under the FCA in connection with "illegal DEI" employment practices. In the announcement of the Accenture settlement, DOJ Associate Attorney General Stanley E. Woodward issued a reminder to other federal contractors, “Today’s resolution makes unmistakably clear that the Department will continue to aggressively pursue unconstitutional discriminatory employment practices.”
The lesson here is clear: contractual certifications matter. Federal contractors should continue to conduct meaningful reviews of their employment practices to meet all anti-discrimination compliance obligations. Contractors should maintain robust documentation of these reviews, incorporating both quantitative and qualitative analyses.