Baldor Electric to pay $2 million to settle hiring discrimination case with US Labor Department

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Jun 25, 2012, 11:14 ET

Agreement includes back wages and interest, some job offers, for 795 female and minority applicants denied positions at Fort Smith, Ark., facility

WASHINGTON, June 25, 2012 /PRNewswire-USNewswire/ -- The U.S. Department of Labor's Office of Federal Contract Compliance Programs today announced that Baldor Electric Co. has agreed to settle allegations of systemic discrimination stemming from the company's applicant screening process at its facility in Fort Smith, Ark. OFCCP investigators determined that the process violated Executive Order 11246 by creating a disparate impact on women and minorities. As a result, 795 qualified women, African-Americans and job seekers of Asian and Hispanic descent were denied the opportunity to advance to the interview stage when applying for production and laborer positions.

"I am pleased with this settlement, which reflects a mutual commitment between the Department of Labor and the leadership of Baldor to ensure that all workers have a fair and equal shot at competing for good jobs," said Secretary of Labor Hilda L. Solis. "Our shared goal is to create lasting change so that anyone who comes looking for work at Baldor can be sure that discrimination will never be a factor in determining who gets the job."

Under the terms of the conciliation agreement negotiated by OFCCP, Baldor will pay a total of $2 million in back wages and interest to the affected individuals and will make at least 50 job offers to members of the original class as positions become available. The company also has agreed to undertake extensive self-monitoring measures to ensure that all hiring practices fully comply with the law, including record-keeping requirements.

"Discrimination is preventable when employers have certain processes in place and see to it that they are followed," said OFCCP Director Patricia A. Shiu. "That's why it's so important for federal contractors to implement their affirmative action programs, keep accurate employment records and commit to ending barriers to fair employment. A proactive strategy is the best way to guarantee that all workers have an equal opportunity to succeed in the workplace. Plus, it's the law."

Baldor Electric, which is owned by Zurich, Switzerland-based ABB Ltd., manufactures industrial motors and generators. The company currently holds federal contracts worth more than $18 million with the General Services Administration and the U.S. departments of Veterans Affairs and Justice. From 1997 to 2010, Baldor received $79 million to produce batteries and generators for federal agencies including GSA, the Justice Department and the Army.

In addition to Executive Order 11246, OFCCP enforces Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans' Readjustment Assistance Act of 1974. As amended, these three laws require those who do business with the federal government, both contractors and subcontractors, to follow the fair and reasonable standard that they not discriminate in employment on the basis of sex, race, color, religion, national origin, disability or status as a protected veteran. For general information, call OFCCP's toll-free helpline at 800-397-6251. Additional information is available at http://www.dol.gov/ofccp.

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SOURCE U.S. Department of Labor