Jackson National Life pays $20.5M to settle race, sex discrimination suit

Dive Brief:

Jackson National Life Insurance Company will pay $20.5 million settling discrimination claims of 21 former employees in its Nashville and Denver locations, the U.S. Equal Employment Opportunity Commission (EEOC) announced Jan. 9. The four-year consent decree is the largest monetary settlement ever reached by EEOC's Phoenix District and Denver Field Offices.
Black employees at the insurance company were referred to as "lazy," women endured sexual harassment, and black women were called "resident street walkers" by a high-level manager, the EEOC alleged in a lawsuit filed in September 2016. Allegations also included discrimination in pay and promotion based on race and gender, according to the commission. "These former employees have been very brave to stand up for their rights," EEOC Phoenix District Office Regional Attorney Mary Jo O'Neill said in a statement.
"Jackson does not tolerate discrimination or harassment of any kind," a company spokesperson told HR Dive in an email. "Jackson chose to resolve this matter at this time as the best option to move forward for all parties. While there has been no finding by a court or jury that Jackson violated any laws, we are humbled and recognize that the associates who made claims in this case believe they were not treated fairly or in a way that aligns with Jackson’s core values." The company called the allegations "concerning."

Dive Insight:

The Civil Rights Act of 1964 is benchmark legislation that continues to "resonate in America," according to the U.S. Department of Labor. The EEOC enforces Title VII of the act, which makes it illegal for employers to discriminate based on several protected classes, including race and gender.

The EEOC has been busy in this regard. In December 2019, the federal agency reached a settlement with Uber regarding the alleged sexual harassment and retaliation of its employees by their managers. The ride-sharing company said a $4.4 million fund would be created to compensate the employees who've experienced such issues. Dollar General agreed to pay $6 million in November 2019 to settle a EEOC lawsuit alleging that its use of criminal history in hiring decisions created a disparate impact on black applicants, in violation of Title VII.

The federal agency released 2018 litigation data in April 2019 detailing that it resolved a total of 90,558 charges of discrimination, overall securing $505 million for workers in private sector, state and local government, and federal workplaces.

EEOC "continued to pursue aggressive litigation and close out settlements at high rates" in 2019, despite some setbacks, according to a Dec. 30, 2019, report from law firm Seyfarth Shaw LLP.

Paychex, Inc., a Rochester, NY-based company that provides HR outsourcing services, analyzed EEOC enforcement and litigation statistics from 1997-2018. The report, published in August 2019, found that of the 1,889,631 discrimination complaints filed, the majority (64%) of charges brought to the EEOC were dismissed as having found no issue after investigation, and around 18% were closed for administrative reasons.

There have been instances when EEOC lawsuits have resulted in favorable rulings for employers. For example, the 8th U.S. Circuit Court of Appeals in St. Louis ruled in December 2019 that the commission must pay $3.3 million in attorneys’ fees to defendant CRST Van Expedited, Inc. of Cedar Rapids, Iowa, after more than a decade of litigation. The EEOC was faulted for failing to satisfy its pre-suit obligations under Title VII by allegedly declining to investigate and individually engage in settlement negotiations of the more than 200 of claims of sexual harassment at CRST, instead filing a "pattern and practice" lawsuit.

EEOC offers Best Practices of Private Sector Employers to prevent equal employment opportunity (EEO) complaints and to manage complaints. In regard to preventing racial discrimination in the workplace, the agency suggests that a strong EEO policy embraced at the top levels of the organization is preliminary. The company should then train HR managers, supervisors and employees on its contents, enforce it and hold them accountable. Experts say promoting an inclusive culture in the workplace and communication are key as well.