Palantir, a data-mining firm that counts controversial Silicon Valley entrepreneur Peter Thiel among its co-founders, will pay $1.7 million to the U.S. Department of Labor to settle claims of racial discrimination.
The Department of Labor announced the settlement on Wednesday, which orders Palantir to pay back wages and the value of stock options to Asian applicants against whom it discriminated in the original hiring process. Eight of the applicants will also get new job offers from the company as part of the settlement.
In a complaint filed last year, the Department of Labor alleged that Palantir used a hiring process and selection procedure that would make it harder for Asian applicants to get software engineering positions. Asian applicants were "routinely eliminated" in the resume-screening and telephone-interviewing processes in favor of white employees, according to the complaint.
Since Palantir's clients include federal government agencies, it is prohibited from discriminating against applicants on the basis of race, color, sex or national origin. The settlement does not hold Palantir liable for its hiring practices, but without it, the company would have risked the loss of its federal contracts.
"We disagree with the allegations made by the Department of Labor," Palantir said in a statement to The Guardian. "We settled this matter, without any admission of liability, in order to focus on our work. We continue to stand by our employment record and are glad to have resolved this case."
Palantir was founded in 2003 by former PayPal co-founder and CEO Peter Thiel, among others. The FBI, the U.S. Special Operations Command and the U.S. Department of the Army all use its data analysis products, which include cyber security and anti-fraud tools. Given its close relationship with federal law enforcement, questions arose last fall about whether Palantir would be willing to create a Muslim registry for the Trump administration. Palantir CEO Alex Karp dismissed the idea, saying "If we were asked, we wouldn't do it."