Almost one year ago in this Houston Employment Law Blog, we discussed an interesting race discrimination lawsuit that had been filed against the national young women’s clothing retailer Wet Seal. The retailer was facing a class action lawsuit that accused it of firing black employees and replacing them with blond-haired-blue-eyed young women. After the U.S. Equal Employment Opportunity Commission launched a three-year investigation into this company as a result, the employer has now agreed to settle the lawsuit for $7.5 million.
About $5.58 million of that settlement is slated to go directly into a fund to provide compensation for damages to current and former black Wet Seal managers.
This lawsuit was quite interesting in that the accusations of discrimination were actually pointed at the executive level. Often, lower level supervisors or managers are accused of discrimination, which is sometimes due to poor training provided by the company. But in this case, the company was accused of actually maintaining an executive policy to fire black workers in order to make room to fill its stores with blonde white women.
It is important to note, however, that regardless of whether discrimination is coming down from an executive, a mid or low-level manager–or even a co-worker–the company can often be held liable.
In addition to the financial settlement, Wet Seal has agreed to promote diversity within the company and to better investigate complaints of discrimination.
Wet Seal, however, has not admitted fault.
A class of plaintiffs in this lawsuit were represented by the NAACP Legal Defense and Education Fund. The director-counsel of the firm told the LA Times upon news of the settlement that while Wet Seal is attempting to correct its mistakes: The fight for equality in the workplace is far from over in America.”
Source: Los Angeles Times, “Wet Seal to pay $7.5 million to settle race discrimination suit,” Tiffany Hsu, May 9, 2013