Employer settles discrimination case for $29.5 million

On November 4, the U.S. Department of Justice and the U.S. Equal Employment Commission (EEOC) announced a $29.5 million settlement with a defense and aerospace manufacturer. The settlement resolves allegations relating to employment discrimination and related false certifications of compliance with federal civil rights laws while serving as a federal contractor.

A portion of the settlement, $7.5 million, will be paid to more than 1,000 employees affected by alleged violations of Title VII of the Civil Rights Act. The EEOC claims the company engaged in race discrimination against white employees, including in performance assessments and in bonus and other compensation decisions. This is the largest class of workers awarded payment under an EEOC settlement for alleged Title VII violations arising from or relating to a Diversity, Equity, and Inclusion program or practices.

Alleged violations included claims that the company:

• Took race into account when making employee compensation decisions.
• Took race or sex into account when making hiring and promotion decisions, including, efforts to achieve progress towards non-public race and sex-based workforce composition goals for business units. The goals were intended to impact the company’s promotion and hiring decisions.
• Offered certain training, mentoring, and leadership development programs, and/or similar opportunities to eligible employees based on race or sex, for example, an Executive Leadership Diversity Mentoring program. These programs were designed to boost the career prospects of these individuals over others through sponsorship and networking.

As part of the resolution, in addition to monetary relief, the EEOC’s agreement requires the company to comply with Title VII and Executive Order 14151 and to maintain a merit-based workplace in which race and sex aren’t considered in hiring, compensation, bonus, or promotion decisions. The EEOC may review the company’s compliance over the term of the agreement.

Key to remember: Manufacturer resolves allegations relating to employment discrimination and related false certifications of compliance with federal civil rights laws while serving as a federal contractor.