Dive Brief:

• The U.S. Department of Labor filed a lawsuit against Oracle Wednesday alleging discriminatory employment practices that resulted in female, African American and Asian employees being paid less than white male counterparts with the same job title, according to a Labor Department announcement. The suit also accused Oracle of favoring Asian workers for product development and technical roles.

• "Federal contractors are required to comply with all applicable anti-discrimination laws," said the Office of Federal Contract Compliance Programs (OFCCP) Acting Director Thomas M. Dowd. "We filed this lawsuit to enforce those requirements." 

• However, Oracle denies the claims saying the complaint is "politically motivated, based on false allegations, and wholly without merit," according to a statement the company supplied to TechCrunch.

Dive Insight:

President-elect Donald Trump will be sworn into office on Friday, and with the help of his transition team, which includes Oracle co-CEO Safra Catz, the new administration will take control of the U.S. government. With the incoming administration, a new team will lead the Labor Department, meaning agency priorities could change. 

Some were expecting an uptick in government lawsuits prior to the administration change. Earlier this week, the Bloomberg BNA Labor and Employment Blog predicted more government lawsuits that are "perhaps politically motivated." 

Oracle has several hundred federal government contracts. Because of that, the company must comply with federal rules that prohibit employment discrimination of any kind.

OFCCP says if Oracle does not supply "complete relief for the affected class including lost wages, stock, interest, front wages, salary adjustments, promotions and all other lost benefits of employment and a reform of discriminatory policies," the agency will ask that all the company’s federal government contracts be cancelled. The Labor Department would also request Oracle be prevented from entering future contracts, which could be a huge blow to the company.