Gap Agrees to Settle Discrimination Case

Gap Inc. has agreed to pay more than $500,000 to settle a class-action lawsuit involving allegations of racial discrimination against African American workers at its distribution warehouse in Gallatin, Tenn.

The San Francisco-based parent of 4,200 Gap, Old Navy and Banana Republic stores confirmed that the case had been settled but declined to offer details.

“We are pleased to have reached an amicable agreement that provides a satisfactory resolution for everyone involved,” Gap spokesman Alan Marks said.

The lawsuit, filed in 1999, included charges that Gap created a hostile work environment for African American workers and engaged in discriminatory selection and promotion practices. Gap has denied the allegations.

About 400 current and former employees are eligible to participate in the settlement.

Gap shares rose 15 cents to $18.20 on the New York Stock Exchange. They are up 17% this year.

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Leslie Earnest