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The Power of Class Action Lawsuits: Merrill Lynch’s $20 Million Settlement on Racial Discrimination
Class action lawsuits are often seen as the vehicle of justice for the average person, allowing individuals to band together to hold even the most formidable, seemingly untouchable companies to account for their actions. A recent case involving Merrill Lynch, a Wall Street brokerage titan, has brought this to light, with the company agreeing to pay nearly $20 million to settle a class-action lawsuit alleging racial discrimination against its Black financial advisers.
This lawsuit claims that African American advisers employed by Bank of America-owned Merrill received less compensation and fewer promotions than their white counterparts. Furthermore, these employees were terminated at higher rates with fewer opportunities for advancement due to discriminatory practices entrenched in the company’s culture.
The repercussions of such systemic violations of African-American employees’ rights had to be addressed. The suit filed in the U.S. District Court for the Middle District of Florida by four former Merrill advisers has set a precedent that even the biggest corporations can be held accountable for racial discrimination in the workplace.
Merrill has agreed to pay $19.95 million — beyond attorney fees and administration costs—to compensate those affected. The settlement is set to benefit approximately 1,375 eligible class members. A judge is yet to approve this settlement, but Merrill has also agreed to “programmatic relief” that includes reviews of diversity practices and pay equity analyses.
Bank of America has stated that the settlement allows them to focus on supporting Black financial advisers and their clients. Over the past decade, they have implemented policies and programs to improve diversity and inclusion. This initiative has resulted in an over 40% increase in the number of Black financial advisers at Merrill and a significant upturn in team representation.
The case against Merrill Lynch is not an isolated incident. They have faced similar allegations in the past, resulting in a $160 million settlement in August 2013. These cases underscore the power of class action lawsuits in ensuring even the most powerful entities are held accountable for their actions.
In the fight against race discrimination, class action lawsuits prove time and again that no company is too large or too powerful to be immune from legal recourse. This not only brings justice for those wronged but also forces companies to examine and modify their practices to ensure a more inclusive and equitable workplace.
Lawsuit Shines a Light on Alleged Racial Harassment at Tesla
A California Superior Court recently ruled to validate a class-action lawsuit alleging “severe and pervasive race harassment” against Black employees at a Tesla factory in Fremont. This lawsuit not only affects the alleged victims but also sheds light on the controversial work environment within Tesla.
The claims stem from around 500 declarations, indicating that incidents of racial harassment have been frequent in Tesla’s Fremont factory for nearly eight years. These incidents include the use of racial slurs and derogatory language towards Black employees, as well as a lack of diversity within management positions at the factory. The plaintiffs argue that Tesla has created a hostile work environment for its Black employees, which violates California’s Fair Employment and Housing Act.
“There is much work to do, but we believe we will succeed in showing at trial that there has been a pattern and practice of pervasive race harassment at Tesla’s Fremont factory.” Matthew Helland from Nichols Kaster LLP
Despite having a complaint system since 2017, the lawsuit alleges that Tesla failed to take immediate and appropriate corrective action in response to these accusations. Over 200 plaintiffs working at the Fremont facility reported hearing racial slurs, and about two-thirds of those who provided sworn statements claimed they witnessed anti-Black graffiti and racial slurs.
Further allegations from individual plaintiffs suggest a deeply rooted issue within the factory’s management and work culture, as they reported unchanged racist behaviors despite complaints to supervisors and human resources.
This is not the first time Tesla has faced allegations of unchecked racial harassment and discrimination. In 2021, a former elevator operator at the Fremont factory was awarded $137 million by a federal jury in San Francisco in a racial harassment lawsuit. The significant award underscores the severity of the emotional distress and hostile work environment endured by the plaintiff during his time at the factory.
The lawsuit criticizes the alleged “pre-Civil Rights Era race discrimination” as a standard procedure at the Tesla plant. It asserts that despite awareness of the issue, Tesla took no action to stop it. This accusation contradicts Tesla’s stance in a 2022 blog post, where the company strongly opposed discrimination and harassment and stated that it terminated employees engaged in misconduct.
The case will now focus on determining if there was a pattern of widespread racial harassment at the Fremont factory, whether Tesla was aware of it, and if Tesla took adequate steps to address it. According to Alameda County Superior Court Judge Noel Wise, this lawsuit will provide common facts that can simplify individual cases, as hundreds or thousands of workers may wish to seek damages from Tesla over their treatment.
This case further highlights the ongoing struggle for equality and respect in the workplace, emphasizing the importance of ensuring a safe and comfortable working environment for all, regardless of the company’s size or caliber.
Triumph: Standing Against Gender Identity Harassment
Today, we bring you an encouraging tale from the corporate world, a story of courage, resilience, and justice. This is the saga of a manager at Columbia River Healthcare Inc. who swam against the tide of adversity. This person, preferring gender-neutral pronouns, was subjected to harrowing discrimination and harassment, not only from the staff but also from the management of the organization.
For over six months, even after the manager had courageously disclosed their gender identity and choice of pronouns, the inappropriate and disrespectful behavior continued. It was a blatant disregard for the manager’s personal preferences and a clear violation of Title VII of the Civil Rights Act of 1964, which prohibits any form of discrimination and harassment based on sex, including gender identity.
“Accidental slip-ups may happen, but repeatedly and intentionally misgendering someone is a clear form of sex-based harassment,” said Elizabeth M. Cannon, director of the EEOC’s Seattle Field Office. “Employers have a duty to intervene when employees—including transgender, non-binary, and other gender non-conforming individuals—are treated maliciously in the workplace because of their gender identity. Training can be a powerful tool for informing employees of their rights and proactively preventing harassment.”
This manager, unfortunately, fell victim to a hostile work environment. They were continuously and intentionally addressed with pronouns that conflicted with their gender identity. Attempts to address this issue internally were futile, resulting in no appropriate action from Columbia River Healthcare.
However, this cold shoulder from management did not deter the supervisor from standing up for their rights. They had the courage to fight back against this clear violation of their rights.
It is worth noting that in the landmark case of Bostock v. Clayton County in 2020, the U.S. Supreme Court clarified that Title VII’s protections extend to discrimination and harassment on the basis of gender identity or expression. This means employers cannot discriminate against their employees or potential applicants – by refusing to hire, firing, harassing, or any other means – based on their gender identity.
So, what happened to our brave manager at Columbia River Healthcare? After a prolonged struggle for justice, the manager triumphed. The healthcare company was required to compensate them, revise its non-discrimination policies, provide employee training, and ensure additional training for managers and staff involved in investigating employee complaints of discrimination and harassment.
If you or someone you know is enduring similar discrimination and harassment, be aware that legal avenues exist. Hiring a gender discrimination lawyer can be your best bet to navigate this challenging terrain. With their expertise in discrimination law, they can help you understand your rights and formulate the best legal strategy.
Remember, no one should ever endure humiliation or discrimination because of their identity. Stand up for your rights and keep this manager’s story a guiding light of hope, reminding you that justice can prevail.
$800K Hiring Discrimination Settlement with Caterpillar Inc.
The U.S. Department of Labor has entered into a conciliation agreement with Caterpillar Inc. to resolve alleged systemic hiring discrimination against 60 Black applicants at a heavy equipment manufacturer’s production facility in Decatur, Illinois.
Caterpillar Inc. will pay affected job applicants $800,000 in back wages and interest and offer jobs to 34 eligible class members to resolve the allegations. In a proactive step towards change, the company has also agreed to ensure its hiring policies and procedures are free from discrimination and provide training to all managers, supervisors, and other company officials who oversee hiring decisions.
A routine compliance review by the department’s Office of the Federal Contract Compliance Programs found that Caterpillar discriminated against 60 Black applicants who applied for fabrication specialist/welder positions at its Decatur facility from March 30, 2018, to March 30, 2020. OFCCP enforces Executive Order 11246, which prohibits federal contractors from discriminating in employment based on race, sex, color, religion, sexual orientation, gender identity, or national origin.
“For the past 58 years, OFCCP has been at the forefront of defining and defending equal employment opportunity in the American workplace. We remain steadfast in our commitment to addressing employment policies and practices that create barriers to opportunity and perpetuate inequality,” reassured Office of Federal Contract Compliance Programs Acting Director Michele Hodge. “Companies that accept federal contracts must diligently monitor their hiring processes to ensure applicants are not rejected based on unlawful practices.”
“Our agreement with Caterpillar exemplifies the Office of Federal Contract Compliance Programs’ (OFCCP) commitment to addressing and remedying preliminary indicators of discrimination in our compliance evaluations. As the enforcer of Executive Order 11246, OFCCP ensures that federal contractors like Caterpillar uphold equal employment opportunity. This agreement provides meaningful compensation and job opportunities to affected individuals and aims to ensure that all applicants, irrespective of their race, are considered equally for employment.”
Caterpillar Inc. has contracts to provide machinery to the U.S. Department of the Army, and since 2018, Caterpillar Inc. has held more than $481 million in federal contracts.
OFCCP has introduced the Class Member Locator, a powerful tool to identify applicants or workers who may be entitled to monetary relief and/or consideration for job placement as a result of OFCCP’s compliance evaluations and complaint investigations. If you believe you may be a class member who applied for a fabrication specialist/welder position with Caterpillar Inc. at its Decatur facility during the investigative period, we encourage you to use OFCCP’s Class Member Locator to learn more about this and other settlements.
$200,000 to Clean Up a Hostile Work Environment of Sexual Harassment
The settlement reached with The Cleaning Authority-Fox Valley underscores a pivotal moment in addressing workplace sexual harassment and retaliation
In a compelling tale of courage and justice, employees at The Cleaning Authority-Fox Valley, a cleaning service provider in eastern Wisconsin, stood up against the indignities and violations they faced at work.
“Sexual harassment violates the law, and this case shows despite all the public attention the issue has received, female workers remain vulnerable to harassment in the workplace because of their sex,” said Diane Smason, acting district director of the EEOC’s Chicago District.
The Cleaning Authority’s website boasts, “Professional Cleaning that leaves you stress-free.” However, this claim starkly contrasts with the experiences shared by employees, who describe a workplace riddled with stress and unfair practices. It’s ironic considering both the company’s promises and the reality depicted by its workforce. On one side, the company guarantees clients a spotless home and a worry-free experience, supported by meticulously crafted cleaning plans and eco-friendly products. On the other side, employee narratives highlight issues such as inappropriate touching, sex-based derogatory comments, and retaliation from management. Balancing these perspectives illuminates the complex nature of workplace dynamics within The Cleaning Authority-Fox Valley. Their bravery in confronting adversity and unfair treatment culminated in a significant victory for themselves and other employees facing similar hostile conditions. On September 28, 2023, the U.S. Equal Employment Opportunity Commission (EEOC) filed a lawsuit against The Cleaning Authority-Fox Valley, accusing the company of fostering a hostile work environment and retaliating against female employees who resisted sexual harassment.
“An employer cannot fire employees because they oppose sexual harassment or threaten them to deter them from complaining,” said Gregory Gochanour, regional attorney for the EEOC’s Chicago District. “Prosecuting such violations of Title VII is critical to ensuring the law fulfills its purpose.”
Imagine working a physically demanding job while enduring an employer’s inappropriate behavior and harassment. The job’s physical requirements are exhausting, demanding daily energy and endurance. The emotional burden of unwanted advances and improper conduct from an employer adds a distressing dimension to an already challenging situation. Employees often feel trapped, burdened by fear of retribution and a pervasive sense of helplessness. Against this backdrop, the significance of the employees’ actions at The Cleaning Authority-Fox Valley becomes evident; their resistance to harassment is a personal triumph and a beacon of hope for others in similar circumstances.
The lawsuit revealed instances of inappropriate touching, derogatory comments based on sex, and other harassing behaviors. Some employees felt compelled to quit their jobs, and one was even threatened into early retirement.
In a victory, The Cleaning Authority-Fox Valley agreed to pay $200,000 and provide additional relief to settle the lawsuit, as announced by the EEOC on May 15, 2024. However, the impact of their actions extended further. Under a three-year consent decree, The Cleaning Authority-Fox Valley will review, revise, and implement robust anti-discrimination policies prohibiting sexual harassment and retaliation.
As part of this agreement, all employees will receive in-person training on sexual harassment, with managers and supervisors receiving additional training. Furthermore, an external monitor will be appointed for the first year to receive and review complaints related to harassment and retaliation.
The courage displayed by the employees has led to a substantial settlement and driven systemic changes at The Cleaning Authority-Fox Valley. Their brave actions serve as a powerful reminder of the ongoing fight against illegal sexual harassment, retaliation, and hostile work environments that regrettably persist today.
Sexism, Sexual Harassment, Hostile Environment at FDIC
Shattered Career Dreams
Navigating Allegations and Accountability in Federal Agencies
The Wall Street Journal recently featured a compelling investigative report by Rebecca Ballhaus, unveiling a troubling culture at the Federal Deposit Insurance Corporation (FDIC). The article exposes a toxic work environment marred by strip clubs, lewd photos, and boozy hotel stays.
For years, the FDIC has struggled with a pervasive “boys’ club” culture marked by sexism and frequent sexual harassment. This environment has particularly affected female staff, especially examiners, who have experienced discrimination, missed promotion opportunities, and felt marginalized in a culture that favors male accomplishments. The mishandling of misconduct claims has heightened employee turnover, with inappropriate actions by supervisors and managers fostering a consistently hostile work environment. Rather than address the core issues, the agency often merely transferred perpetrators, a move widely criticized for its ineffectiveness.
“The kind of abuses that were documented in the report are a totally unacceptable way to treat employees at the FDIC and not in line with the core values of the Biden administration,” Yellen told reporters.
Initially optimistic and ambitious new recruits quickly become disenchanted with the workplace, stifled under a glass ceiling maintained by improper conduct and a prevailing boys’ club attitude. Alarming are the claims tied to events led by field supervisor Hien “Jimmy” Nguyen, showcasing the blurred lines and poor judgment that perpetuate this toxic environment. Despite these allegations, Nguyen’s advancement within the Office of the Comptroller of the Currency highlights a disturbing lack of accountability in federal financial regulatory bodies.
Amidst the controversy stands Kevin Burnett, a former senior examiner at the FDIC, who provides a firsthand account of the toxic culture permeating the agency. Burnett’s experience, marked by over a decade of service, reflects a workplace fraught with challenges not just from the nature of the work itself but from a deeply embedded culture of exclusion and impropriety. He recounts instances where professionalism was overshadowed by the personal indulgences of his colleagues, leading to an environment where serious work and meritocracy were often sidelined. His observations shed light on a system struggling to reconcile its esteemed mission with the everyday realities of its internal culture, further complicating the lives of those committed to its success. Secretary Yellen’s condemnation of these practices reveals a deep disconnect between the administration’s declared values and the realities faced by its workforce.
Promising female professionals find themselves sidelined, their potential limited not by their capabilities but by a workplace culture that measures their value by their willingness to submit to a demeaning exchange—success at the expense of personal integrity. This toxic environment spills over into their personal lives, where mandatory social events and excessive drinking blur professional lines. Opportunities to lead projects are dangled and then snatched away, affecting their performance reviews and penalizing them for perceived shortcomings.
Attempts to challenge and change these norms often meet with indifference or retaliation, muffling demands for equitable treatment and sustaining a cycle of inaction. Consequently, the possibilities for career progression are bleak, overshadowed by the toxic dominance of a male-centric workplace. This grim reality forces many talented individuals to exit the FDIC, dismantling their aspirations and underscoring the urgent need for authentic workplace equality. This tale of wasted potential and deferred dreams is a compelling plea for systemic reform.
The FDIC faces severe scrutiny for fostering a work environment steeped in sexual discrimination and harassment, leading to notably high turnover rates, particularly among female examiners who feel marginalized. The tangible impact of this harmful culture extends beyond talent loss. Training a commissioned examiner represents a significant investment, approximately $400,000 over four years. With the resignation rate of examiners-in-training more than doubling recently, the financial strain is considerable, affecting the agency’s fiscal well-being.
Additionally, the FDIC confronts significant financial risks from costly lawsuits over sexual harassment and discrimination allegations. Recent instances of misconduct by supervisors and managers have led to numerous legal actions and complaints, and the agency’s reluctance to implement stringent disciplinary measures has only increased its legal vulnerability.
Beyond the financial costs, the cultural damage is profound. Persistent harassment and discrimination have depleted employee morale, undermining productivity and performance and exacerbating issues like poor mental health among the staff.
In summary, the ongoing culture of sexual discrimination and harassment at the FDIC incurs significant expenses—financially, through increased turnover, legal challenges, and training costs, and intangibly, through lowered morale, hindered employee retention, and a tarnished reputation.
Tesla Settles Sexual Harassment Lawsuit
Amid numerous allegations of race and sex discrimination, Tesla, the electric vehicle innovator, has recently settled a significant lawsuit. The suit, brought forth by Tyonna Turner, a former employee at Tesla’s flagship assembly plant in Fremont, California, charged the company with sexual harassment and retaliation.
The resolution of Turner’s 2023 lawsuit emerged when U.S. District Judge William Orrick dismissed the case after the parties reached a settlement. The specific terms of the settlement remain undisclosed.
Turner’s lawsuit is part of a broader issue; Tesla is facing several claims of neglecting rampant harassment against Black and female employees at the Fremont site, indicating a troubling trend in the company’s culture.
During her tenure, Turner reported nearly 100 instances of harassment, including stalking by a male coworker. Despite reporting these incidents, she alleges her concerns were disregarded, culminating in her dismissal in September 2022, which she contends was retaliation for her complaints.
In a decision in August of the preceding year, Judge Orrick denied Tesla’s motion to move the case to private arbitration, referring to a 2022 landmark federal law that prohibits mandatory arbitration for sexual harassment and assault cases.
Tesla Encounters Additional Discrimination Allegations
Turner’s ordeal is reflected in six other ongoing lawsuits against Tesla in California state court, all centered on similar accusations of sexual and racial discrimination. Beyond individual complaints, Tesla is battling accusations of entrenched racial discrimination at its Fremont plant. These include actions from a U.S. anti-discrimination agency, a lawsuit by its California counterpart, and a collective action representing 6,000 Black workers, citing racial slurs, graffiti, assignment to less favorable tasks, and retaliation for filing complaints. These cases illuminate systemic workplace issues, emphasizing the urgent need to foster supportive, diverse, and inclusive work environments.
Despite Tesla’s rebuttal of any wrongdoing, the steady stream of lawsuits, especially those concerning racial discrimination, signals a pressing need for Tesla to undertake comprehensive reforms to address these ingrained issues.
Tesla professes a zero-tolerance policy towards discrimination, stating it has terminated employees for racist conduct. Yet, the continuous allegations highlight the importance of transparent, proactive measures in addressing discrimination claims.
For companies worldwide, Tesla’s legal struggles serve as a compelling reminder of the significance of nurturing a culture that values diversity, equity, and inclusivity. The mandate is clear for all organizations: enforce robust anti-discrimination policies, cultivate an environment where these policies are actively upheld, and ensure employees can express concerns without fear of retaliation. This involves regular audits, training sessions, and forums for ongoing discussion on these vital matters. Organizations can avoid similar legal entanglements and cultivate a diverse, motivated, and innovative workforce. This moment should serve as a wake-up call, urging businesses to review their policies, listen to their workforce, and commit to building a workplace where everyone, regardless of background, is valued and respected.
If you have experienced workplace sexual harassment, discrimination, or retaliation, it’s imperative to contact an experienced employment law attorney without delay. These professionals possess the expertise necessary to assess your situation critically, offer informed advice, and guide you through the complexities of legal recourse available. Taking prompt action is not only about seeking justice for oneself but also contributes to the broader effort of holding organizations accountable for their workplace culture and practices. An attorney can help safeguard your rights and ensure that your voice is heard, marking a step towards fostering a more equitable and respectful working environment for all.
Liberty Energy Faces $265,000 Penalty in Race/Color, National Origin Discrimination Case
Federal Agency Announces Resolution to Charges of Racial and Ethnic Harassment in the Workplace
Liberty Energy, Inc., operating as Liberty Oilfield Services, LLC, has been ordered to pay $265,000 due to allegations of racial and ethnic discrimination. The lawsuit was led by the U.S. Equal Employment Opportunity Commission (EEOC) on behalf of three company mechanics, setting a powerful example of the financial consequences of not adequately addressing harassment complaints.
Regional Attorney Robert Canino said, “Unfortunately, we have often seen cases in which one account of discriminatory treatment against a person based on a particular race or ethnicity leads to evidence that other racial or ethnic minorities have also been caught up in a broader unhealthy environment of demeaning and unlawful conduct. This employer’s commitment to address the bigger-picture issues can be expected to have a broader positive impact beyond the individual who filed the charge.”
The case details suggest a hostile work environment at Liberty Energy’s Odessa, Texas location, involving a Black field mechanic and two Hispanic co-workers who were consistently targeted with racial and ethnic slurs. The employees alleged that their multiple reports of discrimination to supervisors and human resources were ignored, leading to a damaging atmosphere that ultimately forced the Black mechanic to resign.
This case underscores the legal and financial implications businesses face when they fail to meet their obligations under Title VII of the Civil Rights Act of 1964, which strictly prohibits workplace discrimination based on race or national origin. In order to avoid substantial legal fees and monetary damages, it is crucial that complaints regarding discriminatory treatment are promptly and effectively addressed.
In addition to the financial penalty, Liberty Energy must now implement comprehensive measures and policies to prevent future discrimination, including:
- Training programs on federal laws regarding employment discrimination.
- A policy that empowers human resources and management personnel to promptly respond to discrimination reports.
- A dedicated hotline for discrimination and harassment reporting.
EEOC Senior Trial Attorney Joel Clark expressed optimism about the settlement, expressing hope that the stipulated measures will foster a discrimination-free work environment within the company. Regional Attorney Robert Canino echoed the sentiment, highlighting that the employer’s commitment can contribute to a broader positive impact on workplace culture and practices.
Race Discrimination – Unequal Work Assignments Based On Race
Delivery company DHL is to pay $8.7 million in compensation and will be monitored by a court-appointed overseer to settle a class race discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC). The federal agency filed a suit claiming that DHL had segregated its Black and white employees, discriminated against Black employees based on race in the terms and conditions of their employment, and given them unequal and heavier work assignments. Black employees were also assigned to routes in neighbourhoods with higher crime rates, which put them at risk of witnessing or becoming victims of crime.
However, segregating employees and giving them unequal work assignments based on their race is just as unlawful. Such practices should not occur in any workplace. We are confident that the measures put in place by the consent decree will ensure that DHL’s employees are treated equally going forward.
The EEOC charged that DHL’s actions violate Title VII of the Civil Rights Act of 1964, which prohibits racial segregation and discrimination in employment. Under the consent decree, DHL will compensate 83 Black employees who were subjected to the alleged discriminatory conduct and chose to participate in the lawsuit, with $8.7 million in total. The decree also requires DHL to train its workforce on federal laws prohibiting race discrimination and provide periodic reports to the court-appointed overseer and the EEOC on work assignments and complaints of race discrimination. DHL will be monitored for four years by former EEOC Commissioner Leslie Silverman to ensure compliance with the decree.
According to Gregory Gochanour, Regional Attorney for the EEOC’s Chicago District Office, DHL’s segregating employees and giving them unequal work assignments based on their race is just as unlawful as paying them less or denying promotions. The measures put in place by the consent decree will ensure that DHL’s employees are treated equally going forward. Karla Gilbride, General Counsel of the EEOC, stated that if an employer orders Black workers to continue working in areas perceived as dangerous while accommodating the requests of white workers, it sends a message that the lives and safety concerns of Black workers are valued less than those of their white colleagues, which is plainly unlawful.
EEOC Chair Charlotte A. Burrows emphasised that the Civil Rights Act of 1964 outlawed racially segregated workplaces sixty years ago, and the EEOC remains committed to enforcing it vigorously so that race-based job segregation becomes a thing of the past. It’s time for employers to realise that discriminating based on race has no place in any workplace.