Charges of Prejudice Against Firms Rise : They question the notion of a level playing field. Two lawsuits target alleged racial bias by Avis, Circuit City.
As smoking guns go, they aren’t all in the same league as a secret tape filled with talk about “black jelly beans” and shredding documents.
But a number of discrimination complaints across the country, coming to the fore just as California voters approved a proposition banning racial preferences, call into question the notion of whether there is a level racial playing field.
After Texaco was rocked by reports that company executives plotted to destroy evidence in a class-action discrimination suit and mocked black employees as “black jelly beans” at the bottom of the bag, the company agreed to a record $176-million settlement. On Tuesday, the former Texaco executive whose secret tape recordings touched off the scandal was charged with federal obstruction of justice.
In Richmond, Va., black plaintiffs are contending in a trial now underway that they were denied promotions by Circuit City, a national chain of discount electronic stores, because of their race. A worker testified that a company vice president told him that “most blacks are incapable of performing at the corporate level.”
And a group of African Americans suing Avis Rent-A-Car Systems Inc. for racial discrimination contend that top company officials knew about allegations of racism at some Avis franchises but did nothing about them.
Circuit City and Avis have denied the charges.
In a written statement released last week, Avis Chairman and Chief Executive Officer Joseph V. Vittoria said he was “outraged and profoundly troubled” by the allegations against his company.
Terry Gordon, a spokesman for Avis, said the company recently had begun an internal investigation. He declined further comment because of the litigation.
But according to lawsuit depositions, former employees say they were trained at a franchise on how to avoid renting cars to African Americans and were reprimanded when they did so.
John P. Relman, an attorney with the Washington Lawyer’s Committee for Civil Rights and Urban Affairs, which filed the class-action lawsuit against Avis last week, alleges that Avis made a “calculated decision” to tolerate evidence of discrimination at five franchises run by John Dalton in North and South Carolina because the locations were profitable.
In Relman’s view, such accommodation is widespread in corporate America.
CEOs generally recognize the value of having a diverse work force because nonwhites and women make up a growing portion of the marketplace. “But . . . when those goals come into conflict with the perpetuation of the old boy corporate network you find some CEOs quickly give in,” he said.
Relman’s group represented the six black Secret Service agents who sued the Denny’s Restaurant chain after they alleged biased treatment in 1993. It became a class-action lawsuit that was settled last year for $46 million.
Cindy Smith of Wilmington, N.C., said in an interview that she encountered evidence of racism immediately after she began working for Avis as a marketing and sales manager in 1990. She said she saw Dalton, the franchise owner named in the lawsuit, crumple up and throw away an application from a black job seeker immediately after the applicant left.
She said he then used a racial epithet.
Smith, who is white, said she heard Dalton repeatedly use racial slurs for black people and instruct rental agents, all of whom were white: “I don’t care how well they’re dressed. I don’t care what they look like. I don’t care what their credit limit is. Don’t rent them a car. Do what you have to do not to rent them a car.”
Dalton did not return a reporter’s phone calls but denied the allegations to the Wilmington Star newspaper last week.
Smith said she complained about discriminatory practices in 1990 only to have corporate managers laugh and say, “You live in the South--what do you expect?”
She left the company in 1991 when her position was eliminated and said she decided to speak out after hearing about the lawsuit.
“I teach my kids that racism is bad,” said Smith, now a preschool teacher. “What kind of message would it send if I did nothing?”
The lawsuit, relying on statements from Smith and others, contends that Avis management knew about discriminatory practices but did nothing about them.
The lawsuit alleges that one complaint-line operator said company executives told her the franchises make too much money to be terminated. And angry black customers, who called the company’s complaint line after they were turned down for car rentals, were told about other complaints about the same franchises, according to the plaintiffs’ lawyers.
Calls to Avis’ complaint line are automatically recorded, Relman said, but so far the company has not allowed attorneys to review the tapes.
* TEXACO CHARGES: U.S. accuses former executive of obstructing justice. D1
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Bias Complaints
Two current discrimination complaints, both denied by the companies:
* AVIS: Some African Americans are suing Avis Rent-A-Car Systems Inc., claiming that top company officials knew about allegations of racism at some franchises but took no action.
* CIRCUIT CITY: Black plaintiffs are contending in a trial that they were denied promotions by Circuit City, a national chain of discount electronic and appliance stores, because of their race.
