CONCILIATION AGREEMENT

Between
THE U. S. DEPARTMENT OF LABOR
OFFlCE OF FEDERAL CONTRACT COMPLIANCE PROGRAMS
and
NA VISTAR DIESEL OF ALABAMA, LLC

PART I. PRELIMINARY STATEMENT

The Office of Federal Contract Compliance Programs C'OFCCP") commenced a complaint
investigation and a compliance evaluation ofNavistar Diesel of Alabama, LLC's (fonnerly
known as "International Diesel of Alabama, LLC") (hereinafter "NAVJSTAR DIESEL")
establishment located at 646 James Record Road, Huntsville, Alabama on December 15, 2004
and April 19, 2006, respectively, and found that NA VISTAR DIESEL was not in compliance
with the Executive Order 11246, as amended ("E.O. 11246"), and its implementing regulations at
41 C.F.R. Section 60-1. OFCCP notified NAVJSTAR DIESEL of the initial violations found
and the corrective actions required in a Notice of Result of Investigation issued on May 14, 2008,
and a Notice of Violation issued on June 16, 2010. In the interest of resolving the violations
without engaging in further legal proceedings and in exchange for the good and valuable
consideration described in this document, OFCCP and NA VI STAR DIESEL enter this contract
("Conciliation Agreement" or "Agreement") and agree to all the terms stated below.
PART II. GENERAL TERMS AND CONDITIONS

1. In exchange for NA VlSTAR DIESEL's fulfillment of all obligations in Parts II r and IV of
the ·Agreement, OFCCP agrees not to institute administrative or judicial enforcement
proceedings under E.O. 11246 based on the violations described in more detail in Part III
below. However, OFCCP has the right to initiate legal proceedings to enforce the Agreement
itself or to correct and obtain relief for the violations described in Part III ifNAVISTAR
DIESEL violates this Agreement. Nothing in this Agreement precludes OFCCP from initiating
enforcement proceedings based on future compliance evaluations or complaint investigations.
2. NAVISTAR DIESEL agrees that OFCCP may review its compliance with this Agreement.
As part of such review, OFCCP may require written reports, inspect the premises, interview
witnesses, and examine and copy documents. NAVISTAR DIESEL will penn it access to its
premises during nonnal business hours for these purposes and will provide OFCCP with all
teports and documents requested.

020

 3. NA VISTAR DIESEL understands that nothing in this Agreement relieves NA VI STAR
DIESEL of its obligation to fully comply with the requirements of E.O. 11246, Section 503,
VEVRAA, their implementing regulations, and other applicable equal employment laws.
4. NAVISTAR DIESEL promises not to harass, intimidate, threaten, discriminate, or
otherwise retaliate against any individual because the individual: benefits from this
Agreement, files a complaint or participates in any investigation or proceeding under E.O.
11246, Section 503, and/or VEVRAA, or engages in any activity listed at 41 C.F .R. § 60·
J.32(a).

S. The parties understand the terms of this Agreement and enter into it voluntarily.
6. This Agreement, including any attachments, contains the complete and final understanding
of the parties with respect to the matters referenced herein. This Agreement contains all
terms by which the parties are bound and it supersedes all prior written or oral negotiations
and agreements. There will be no modifications or amendments to this Agreement unless
they are in writing, signed by all parties.
7. If one or more provisions of this Agreement are rendered unlawful or unenforceable, the
remaining provisions will remain in full force and effect.
8. This Agreement becomes effective on the day it is signed by the Deputy Regional Director
of the Atlanta Region (the "Effective Date") unless the Director ofOFCCP indicates
otherwise within 45 calendar days of the date the Deputy Regional Director signs the
Agreement.
9. This Agreement will expire 60 days after NA VISTAR DIESEL submits the final report
required in Part lV- J.D, below, unless OFCCP notifies NAVISTAR DIESEL in writing prior
to the expiration date that NAVISTAR DIESEL has not fulfil led all of its obligations under
the Agreement, in which case, the Agreement is automatically extended until the date that
OFCCP determines NA VIST AR DIESEL has met all of it obligations under the agreement.
10. If NA VlSTAR DIESEL violates this Conciliation Agreement,
A. The procedures set forth at 41 C.F.R. § 60-1.34 will govern:
a.
lfOFCCP believes that NAVISTAR DIESEL violated any term of the
Agreement while it was in effect, OFCCP wilt send NAVISTAR DIESEL a
written notice stating the alleged violations and summarizing any supporting
evidence.
b. NA VISTAR DIESEL will have 15 days from receipt of such notice to
demonstrate in writing that it has not violated the Conciliation Agreement, unless
such a delay would result in irreparable injury to the employment rights of
affected employees or applicants.
c.
lfNA VISTAR DIESEL is unable to demonstrate that it has not violated the
Agreement, or if OFCCP alleges irreparable injury, enforcement proceedings may
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021

 be initiated immediately without issuing a show cause notice or proceeding
through any other requirement.
d.
OFCCP may seek enforcement of this Agreement itself and is not required
to present proof of any underlying violations resolved by this Agreement.
B. NA VlSTAR DIESEL may be subject to the sanctions set forth in Section 209 of the
Executive Order and/or other appropriate relief for violation of this Agreement.
11. This Agreement does not constitute an admiss.ion by NA VJSTAR DIESEL of any
violation ofE.O. 11246, Section 503, VEVRAA, or other laws, nor has there been an
adjudicated finding that NAVISTAR DIESEL violated any laws.

PART III. SPECIFIC VIOLATIONS AND REMEDIES
1. STATEMENT OF VIOLATION.
HIRING DISCRJMJNATION:
OFCCP found that NAVISTAR DIESEL is not in compliance with the
nondiscrimination requirements of the equal opportunity clause ofE.O. 11246 §
202 and 41 C.F .R. § 60-1.4(a)(l ). OFCCP performed a complaint investigation
and a compliance review which revealed that NA VISTAR DIESEL
discriminated against minority applicants for Machinist and Assembler positions
at NA VlSTAR DIESEL's Hunstville, Alabama facility during review periods
spanning January 2004 through December 2004, and October 2004 through
September 2005. OFCCP found that there was a statistically significant
disparity in the hiring of Machinist and Assembler positions based on race.

2. OFCCP'S SPECIFIC FINDINGS.
HIRING DISCRIMINATION:
OFCCP's analysis ofthe applicant and hiring data demonstrates that
NAVISTAR DIESEL's selection process had an adverse impact on the hiring of
minority applicants for Machinist and Assembler positions. The complaint
concerned a
that included a written battery oftests created by
overatl disparity for the
testing process was statistically significant at
standard deviations with a
shortfall of 5, while the ~test specifically resulted in a standard deviation of
with a shortfall of I 8. The compliance review concerned a
and
that included a written battery of tests created by
known a s - ; the overall disparity for the testing process was
statistically significant at~ndard deviations with a shortfall of3, while the
test specifically resulted in a standard deviation o~ and a
shortfall of 4. Through its investigation, OFCCP determined that the adverse
impact was caused by the lllland ests, rather than by any other
steps in the either application process. OFCCP further found that NA VISTAR

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022

 DIESEL had not properly validated hiring tests in accordance with the
requirements of the Uniform Guidelines on Employee Selection Procedures, 4 J
C.F.R. Part 60-3. Accordingly, as a result of using the ~nd- tests,
NA VISTAR DIESEL discriminated against qualified minority applicants who
applied for Machinist and Assembler positions during the review periods .
3. REMEDY FOR AFFECTED CLASS.
A. Notice. By March 14,2014, NAVlSTAR DIESEL must notify the minority applicants
listed in Attachment A of the terms of this Agreement by mailing by first-class mail to
each individual in the affected class the: Notice to Affected Class (Attachment B,
"Notice"), Information Verification & Employment Interest Form (Attachment C,
"Interest Form"), and a postage paid return envelope. NAVISTAR DIESEL will on a
monthly basis. In addition, by Apri128, 2014, NAVISTAR DIESEL will notify OFCCP
of all letters returned as undeliverable and provide OFCCP with a Jist of the individuals
in the affected class who have not yet responded to the Notice and/or have not returned a
signed Interest Form . OFCCP will then attempt to obtain and provide updated addresses
to NAVISTAR DIESEL by June 27,2014. NAVISTAR DIESEL agrees to mail by firstclass mail a second Notice, Interest Form, and postage paid return envelope to all
individuals for whom updated addresses were obtained by July 28,2014.
B. Eligibility. All members of the affected class listed on Attachment A who sign and
return the Interest Fonn to NAVISTAR DIESEL within 30 calendar days ofthe ·
postmarked date on the envelope containing the first or second Notice and Interest Form
("Eligible Class Members") will receive a share of the monetary settlement and, if
indicating an interest in employment, will be eligible to be considered for a job pursuant
to this Agreement If an individual receives, but does not return the Interest Form to
NA VISTAR Dl ESEL within 30 calendar days of the postmarked date on the envelope
containing the .first or second Notice and Interest Form, he/she will no longer be entitled
to a payment or consideration for a job under this Agreement.
Within 30 days after the response deadline set out in the Interest Form, NA VISTAR
DIESEL will provide OFCCP with a list ofthe Eligible Class Members (individuals who
returned the Interest Fonn by the deadline). Within 60 calendar days after receiving the
list, OFCCP will approve the final list of Eligible Class Members or discuss with
NA VISTAR DIESEL any issues necessary to finalize the list, such as the inclusion or
exclusion of certain individuals.
All Eligible Class Members are entitled to their share of the monetary settlement
regardless of whether they are interested in employment with NAVISTAR DIESEL.
C. Monetary Settlement. NAVISTAR DIESEL agrees to distribute $85 ,000.00, less legal
deductions required by law from back pay only (such as federal. state and/ or local taxes
and the Eligible Class Members· share of FICA taxes). in equal shares among all eligible
class members on the final approved list. NAVISTAR DlESEL will pay the employer's
share of social security withholdings to the appropriate government agency and will mail
each Eligible Class Member an IRS W-2 Form reporting the portion of the payment

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023

 representing back pay and an IRS Form l 099 for the portion of the payment representing
interest. These forms will be mailed in the time period required by law. NA VISTAR
DIESEL will disburse the monetary settlement within 30 calendar days after OFCCP
approves the final list of Eligible Class Members.
Within 30 calendar days ofNAVISTAR DIESEL's receipt of a check to an Eligible Class
Member returned as undeliverable. NA VlSTAR DrESEL will notify OFCCP of this fact
via e-mail sent to
Compliance Officer, at
m Mitchell, District Director, at
!.!!.!!~!!!.!.;.!!.!.!.~~:!.!:.C~· OFCCP will attempt to locate the Eligible Class Member and if
OFCCP obtains an alternate address, NAVJSTAR DIESEL will re-mail the check within
30 calendar days of receiving an alternate or corrected address. Any check that remains
uncashed I 20 days after the initial date the check was mailed to the Eligible Class
Member will be void. With respect to any uncashed funds, NA VISTAR DIESEL will
make a second distribution to those Eligible Class Members who did cash their first
check, dividing all remaining uncashed funds equally among the remaining Eligible Class
Members. This second distribution ofthe uncashed funds will be made within 30 days
after the uncashed checks have been voided.
D. Employment. As positions become available, NAVJSTAR DfESEL will consider
qualified Eligible Class Members not currently employed by NA VISTAR DIESEL who
express an interest in employment with NAVISTAR DIESEL until 7 EHgible Class
Members are hired as Machinists or Assemblers or until the list of Eligible Class
Members expressing an interest in employment is exhausted~ whichever occurs first.
Eligible Class Members will be considered in the order that NA VISTAR DIESEL
receives their Jnterst Fonns. lfNAVISTAR DIESEL receives more than one response on
any given day, those Eligible Class Members will be considered for employment based
on the date of their original application. NAVISTAR DIESEL must initiate its hiring of
Eligible Class Members within 30 days after the response deadline set out in the Interest
Form and must complete its hiring obligations under this. section within one year of the
Effective Date of this Agreement. lfNA VISTAR DIESEL is not able to hire 7 Eligible
Class Members or exhaust the list of Eligible Class Members expressing an interest in
employment within one year~ OFCCP may extend the term of this Agreement for up to 12
additional months or until NAVJSTAR DIESEL satisfies its hiring requirement(s),
whichever occurs first.
Eligible Class Members will be allowed at least 2 weeks to report for work after
receiving a written job offer from NA VISTAR DIESEL. The Eligible Class Members
hired into Machinist or Assembler positions pursuant to this Agreement must be paid at
least the current wage rate for the Machinist or Assembler position, and must be provided
with the same benefits and opportunity to earn overtime and shift differentials as other
Machinist or Assembler employees. In addition, all Eligible Class Members hired must
receive retroactive seniority using the date of their original application as their hire date
for all purposes, including job retention, job bidding and benefits.
E. Non-Monetary Remedies. NAVISTAR DIESEL will ensure that all applicants are
afforded equal employment opportunities. NA VLSTAR DIESEL agrees to immediately

5
024 -

 cease using the selection procedures, practices, and/or policies which negatively affected
the hiring of minority applicants for Machinist and Assembler positions. NA VlSTAR
DIESEL agrees to continue and/or to implement the corrective actions detailed below.
a.
Eliminate Discriminatory Selection Procedures: NA VISTAR DIESEL
agrees to immediately cease use of
tests until they are
DIESEL agrees to
validated ir1 accordance with 41 C.F.R.
comply with all OFCCP regulations concerning selection procedures, including
41 C.F.R. Part 60~3. NAVISTAR DIESEL will not use any selection procedure
that has an adverse impact on applicants on the basis of race unless it properly
validates the procedure pursuant to these regulations.
b.
Review and Revisions Reouired: NA VISTAR DIESEL will revise, in
writing, the practices, policies and procedures it uses to select applicants for
Machinist and Assembler positions (hereinafter "Revised Hiring Process").
Specifically, NA VISTAR DJESEL will:

i.
create a job description and selection process for
Machinists and Assemblers which describes the essential functions;
the minimum qualifications including required skills and
certifications; and the criteria used in each step ofthe hiring
process, including any application screens, interviews, tests, credit
checks, review of criminal history, reference checks, testing, or
other selection procedure;
ii.
develop specific, job-related qualification standards for
Machinists and Assemblers that reflect the duties, functions, and
competencies of the position to minimize the potential for race
stereotyping or other unlawful discrimination;
ensure all policies and qualification standards are
uniformly applied to all applicants; and

111.

iv.
list clearly on its recruiting materials and job postings the
minimum qualifications, including required skills and certifications.
c.
Recordkeeping and Retention: NA VISTAR DIESEL will write and
implement procedures to ensure that applicants are tracked and decisions are
documented at each step in the hiring process. NAVISTAR DJESEL will write
and implement procedures to ensure that documents are retained in accordance
with 41 C.F .R. 60-l.l2(a) and Part 60-3.
d.
Training: By April 30, 2014. NAVISTAR DIESEL must train all
individuals involved in any way in recruiting, selecting, or tracking applicants for
Machinist and Assembler positions on the Revised Hiring Process. The training
will include instruction in: the proper implementation of the recruitment, tracking
and selection procedures; neutral application of the specified qualifications and
criteria that will be used at each step in the hiring process; procedures to be used
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 to document the decisions made at each step in the hiring process; and the
procedures to be used to ensure that documents are retained in accordance with 41
C.F .R. § 60-l.l2(a) and Part 60-3. NAVISTAR DIESEL will meet with
management and all individuals responsible for the selection process and review
its equal employment obligations and nondiscrimination policies related to hiring.
Specific attention will be directed to ensure that minority applicants, who benefit
from the provisions of this agreement, are not retaliated against.
e.
Monitoring: NAVISTAR DIESEL agrees to monitor selection rates at each
step of its selection process for Machinist and Assembler positions. Where it is
determined that a selection procedure has an adverse impact on the hiring of
applicants of a particular race or gender, NA VISTAR DIESEL will eliminate the
procedure, choose an alternative procedure, or validate the procedure in
accordance with the UGESP codified at 41 C.P.R. Part 60-3. NAVISTAR
DIESEL agrees to maintain and make available to OFCCP records concerning the
impact of the selection process for Machinist and Assembler positions at the
Huntsville facility. This includes the number of persons hired by race, the
number of applicants who applied by race, and the selection procedures utilized.
This information will be maintained until the expiration of this Agreement or as
long as required by the regulations, whichever is later.
Part IV. REPORTS REQUIRED
NA VISTAR DIESEL must submit the documents and reports described below to: District
Director-Birmingham at 950 22nd Street North, Suite 660, Birmingham, Alabama 35203.
A. By March 31,2014, NAVISTAR DIESEL must submit a copy of the written Revised
Hiring Process described in section 111.

B. By July 31, 2014, NA VISTAR DIESEL must submit documentation thaull managers,
supervisors and other personnel involved in recruiting, selecting, or tracking applicants
for Machinist and Assembler positions have been trained on the Revised Hiring Process.
The documentation must include the dates of the training, the names and job titles of all
attendees, an outline ofthe topics discussed in the training. and the name and job title of
each person who conducted the training.
C. Within the prescribed timeframes, NA VI STAR DIESEL must submit all documents
and information referenced in section Ill.

D. For one year following the Effective Date of this Agreement or until all hires have
been made and all back wages have been distributed, NA VISTAR DIESEL must submit
a progress report covering each 6-month period this Agreement is in effect. The first
progress report will be due 7 months after the Effective Date of this Agreement and must
cover the 6-month period beginning with the Effective Date. The subsequent report(s)
must cover the successive 6-month period, and must be submitted within 30 days after
the close of that 6-month period. NAVISTAR DIESEL will submit the following in each
progress report:

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026

 a.
Documentation of monetary payments to all Eligible Class Members as
specified in section 111.3.C. The documentation must include the names of
Eligible Class Members who were paid, and, for each Eligible Class Member, the
number and the amount of the check and the date the check cleared the bank.
NA VI STAR DIESEL must provide OFCCP with copies of all canceled checks
upon request;
b.
Documentation of specific hiring activity for Eligible Class Members who
were hired as Machinist and Assembler positions in accordance with this
Agreement, including name, date of hire, job title hired into, rate of pay and proof
of retroactive seniority and benefits;
c.
For Eligible Class Members who were considered for employment but were
not hired, NA VIST AR DIESEL will provide the reason for non-placement along
with all relevant documentation (e.g.• documentation that the Eligible Class
Member declined a job offer);
d.
The total number of applicants and hires and the breakdown by race, gender
and ethnic group of applicants and hires for Machinist and Assembler positions
during the reporting period, including all temporary, part time, and seasonal
workers who were referred to and/or assigned to work at NA VISTAR DIESEL by
a staffing finn or employment agency;
e.
For Machinist and Assembler positions, the results ofNAVISTAR
DIESEL' s analysis as to whether its total selection process has adverse impact,
excluding hires made pursuant to this Agreement; NA VISTAR DIESEL must
combine the data for the current report with the data from the previous report(s) to
analyze at least a 12-month period;
f.
For each case where the total selection process has an adverse impact the
results ofNAVISTAR DIESEL's evaluation ofthe individual components of the
selection process for adverse impact; and/ or
g.
The actions taken by NA VISTAR DIESEL upon detennining that any
component of the selection process has an adverse impact on members of groups
set forth in section lli.3.E above.
E. NA VISTAR DIESEL will retain all records and data pertinent to the violations
resolved by this Agreement and/ or used to prepare required reports until this Agreement
expires or as long as required by OFCCP' s regulations, whichever date occurs later.

TERMINATION DATE: This Agreement will expire 90 days after OFCCP receives the final
report required in Part IV above or on the date that the District Director gives notice to
NA VISTAR DIESEL that NA VISTAR DIESEL has satisfied its reporting requirements,
whichever occurs earlier, unless OFCCP notifies NA VISTAR DIESEL in writing prior to the

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027

 end of the 90-day period that NA VISTAR DIESEL has not satisfied its reporting requirements
pursuant to this Agreement.

INTEGRATION CLAUSE: This Agreement represents the full Agreement between
NAVISTAR DIESEL and OFCCP and this Agreement supersedes any other agreements, oral or
written. In signing this Agreement, neither NA vrsTAR DIESEL nor OFCCP relies upon any
promise, representation of fact or law, or other inducement that is not expressed in this
Agreement. This Agreement may be modified only by written agreement of the Parties affected
and may not be modified by any oral agreement.
Part V. SIGNATURES
The person signing this Conciliation Agreement on behalf of Navistar Diesel of Alabama, LLC
personally warrants that he is fully authorized to do so, that Navistar Diesel of Alabama, LLC
has entered into this Conciliation Agreement voluntarily and with full knowledge of the effect
thereof, and that execution of this Agreement is fully binding on Navistar Diesel of Alabama,
LLC. This Conciliation Agreement is hereby executed by and between the Office of Federal
Contract Compliance Programs and Navistar Diesel of Alabama, LLC.

Compliance OtlFice:r--Bilrmim~llam
Office of Federal Contract Compliance
Programs

Plant Manager
Navistar Diesel of Alabama, LLC
646 James Record Road
Huntsville, Alabama 35824

District Director- OrlaRee 8: r-. ~ ".9 ho ~
Office of Federal Contract Compliance
Programs

arva
Deputy Regional Director - Southeast
Office of Federal Contract Compliance
Programs

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028

 ATTACHMENT A.

FFECTED CLASS MEMBERS

 

[129

 

D30

ATTACHMENTB
NOTICE TO AFFECTED CLASS

Dear [NAME]:
Navistar Diesel of Alabama, LLC's (formerly known as "International Diesel of Alabama,
LLC") ("NAVISTAR DIESEL'') and the Department of Labor's Office of Federal Contract
Compliance Programs ("OFCCP") have entered into a Conciliation Agreement ("Agreement") to
remedy the violations of Executive Order 11246 ("E.O. 11246"), that OFCCP found during a
complaint investigation and a compliance review of CONTRACTOR's Huntsville, Alabama
facility. OFCCP performed a complaint investigation and a compliance review which revealed
that NAVJSTAR DIESEL discriminated against minority applicants for Machinist and
Assembler positions at NA VTSTAR DIESEL's Hunstville, Alabama facility during review
periods spanning January 2004 through December 2004, and October 2004 through September
2005. OFCCP found that there was a statistically significant disparity in the hiring of Machinist
and Assembler positions based on race.
NAVISTAR DIESEL has not admitted to any violation of E.O. 11246, and there has not been
any adjudicated finding that NA VlSTAR DIESEL violated any laws. OFCCP and NAVlSTAR
DIESEL entered into the Agreement to resolve the matter without resorting to further legal
proceedings. You have been identified as an individual who applied for a Machinist and/or
Assembler position during that time period, but was not hired.
As part of this Agreement, you are eligible to receive a distribution of at least $955.06 less
lawful payroll deductions. Under the terms of this Agreement it may take up to five months
from the date of this letter before you receive your distribution. In order to be eligible for a
payment, you must complete, sign, and return the enclosed Information Verification and
Employment Interest Form. You should complete and mail back the form as soon as possible; it
must be postmarked to the address below no later than thirty (30) calendar days after the date this
Notice was mailed out (postmarked) for you to be entitled to participate in this settlement:

Tim Powelke
Business Team Leader-HR
Navistar Diesel ofAlabama, LLC
646 James Record Road
Huntsville, Alabama 35824
You may use the enclosed postage-paid return envelope to return the completed and signed
Information Verification and Employment Interest Form.
In addition to the monetary distribution, NAVISTAR DIESEL will be making job offers for
Machinist and Assembler positions to a limited number of individuals receiving this notification.
It is not certain that you will receive a job offer. If you are still interested in employment with
NAVISTAR DIESEL, please check the appropriate box on the enclosed Information Verification

031

 and Employment Interest Form. Those receiving this notice will be considered for Machinist
and Assembler positions in the order that NA VISTAR DIESEL receives the Information
Verification and Employment . Interest Form expressing an interest in employment All
individual hired pursuant to this Agreement will be provided with retroactive seniority for
purposes of benefits. lf you have any questions you may call Tim Powelke, Business Team
Leader-HR. at Navistar Diesel of Alabama, LLC at (256) 774-6400, or OFCCP Compliance
Officer
at (205) 731-0820. Your call will be returned as soon as possible.
IF YOU FAIL TO COMPLETE AND RETURN THE ENCLOSED DOCUMENTS TO
NAVISTAR DIESEL WITHIN 30 CALENDAR DAYS OF THE DATE THE ENVELOPE
CONTAINING THIS NOTICE WAS POSTMARKED, YOU WILL NOT BE ELIGIBLE
TO RECEIVE A PAYMENT OR TO BE CONSIDERED FOR AJOB OFFER.
Sincerely,

JohnL Fulks

Enclosures:
Information Verification and Employment Interest Form

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