Albertson’s to Settle Bias Suit by Paying $29.5 Million : Labor: Women, Latinos accused the supermarket chain of promotion discrimination. Company denies wrongdoing.
Albertson’s Inc. said Monday that it has agreed to pay $29.5 million to settle a class-action lawsuit that alleged discrimination against Latinos and women employed at the company’s 144 stores in California.
The plaintiffs, who filed the suit in U.S. District Court in San Francisco in May, 1992, sought changes in the company’s job promotion practices, as well as back pay and damages for women employed at Albertson’s since April, 1987. The suit cites the complaints of nine women--including two Latinas--who alleged they were not given fair opportunities for promotions. The settlement, which is subject to court approval, includes creating a fund for enhancing Albertson’s job training programs and for monitoring the company’s promotions practices. It also provides money for alleged damages to the 20,000 current and former female employees.
Albertson’s, the nation’s sixth-largest operator of supermarket-drugstores, admitted no wrongdoing in settling the suit. The company said it chose to settle the case to concentrate on its store operations and to avoid litigation costs, said Mike Read, a spokesman for the Boise, Ida.-based company.
“This will save us millions in legal fees,” Read said. “We have mixed feelings because we don’t believe we violated the law. . . . But there was the risk of a loss in the case.”
The lawsuit alleges that women were unfairly denied opportunities for promotion from checkout clerk positions to store management positions and that females in lower-paying jobs in departments such as deli sections were not given fair chances to get higher-paying jobs in the checkout lanes. In addition, part-time female employees were unfairly denied opportunities to work longer hours, the suit alleges.
While the settlement is not unprecedented, the value of the agreement is significant, said Douglas Farmer, a lawyer who specializes in representing management in discrimination cases for Corbett & Kane, a San Francisco law firm.
“This sends a strong message to the employer community,” Farmer said. “It shows the importance of prevention. Any company without training programs or without programs designed to prevent discrimination . . . will run the risk of facing lawsuits. For example, there should be mechanisms for companies to hear and address complaints to avoid this kind of court case.”
Farmer also said companies should establish goals and a system to help ensure that minorities and women are promoted in proportion to their numbers.
Albertson’s has agreed to establish such a system--one that would establish promotion goals for women and Latinos that would be based on the percentage of job promotion applications from females and Latino men. Under the agreement, Albertson’s promotions record would be reviewed periodically for about five years, said David Borgen of Saperstein, Mayeda & Goldstein, the Oakland-based firm that represented the plaintiffs.
Under the agreement, Albertson’s would be eligible to receive up to $500,000 back from the settlement’s fund if the reviews found the company has exceeded its promotions goals. Another $500,000 would be set aside to further develop job training programs designed to prepare women and minorities for higher-level jobs. An additional $500,000 would be divided among the nine plaintiffs named in the suit.
The settlement also calls for the payment of $4.5 million in attorney’s fees. Also, up to about 20,000 current and former female employees would be eligible for payments of varying amounts.
