Union to Create Back Pay Fund of $12.7 Million to Resolve Race Discrimination Claims

Monday, April 6, 2015

Subject to approval by the U.S. District Court for the Southern District of New York, Local 28 of the Sheet Metal Workers' International Association, the trade union for sheet metal journeypersons in New York City, has agreed to create a back pay fund for a group of minority sheet metal workers in partial settlement of race discrimination claims against the local union.  Pursuant to the settlement, it is estimated that the union will pay approximately $12.7 million over the next five years and provide substantial remedial relief to partially resolve claims made against the union by the U.S. Equal Employment Opportunity Commission (EEOC) and others.  The settlement was achieved after extensive negotiations with the union by the EEOC, the New York State Division of Human Rights, the City of New York, and a class of black and Hispanic union members represented by Debevoise & Plimpton LLP and the Lawyers' Committee for Civil Rights Under Law.  A hearing is set for July 14 for the court to consider approving the proposed settlement.  

Over the 44-year history of this case, the federal district court issued a number of rulings that Local 28 discriminated against non-white journeypersons on the basis of race, in violation of Title VII of the Civil Rights Act of 1964.  The current settlement covers claims of work-hour disparities based on race for the 15-year period between April 1, 1991 and June 30, 2006.  This settlement supplements a 2008 settlement of $6.2 million that covered back pay claims from January 1, 1984 through March 31, 1991.

The lawsuit (EEOC, et al., v. Local 28 of the Sheet Metal Workers' Int'l Ass'n, et al., Case No. 71 Civ. 2887 (LAK)) was filed initially in 1971 in the U.S. District Court for the Southern District of New York by the Civil Rights Division of the Department of Justice, the New York State Division of Human Rights, and the City of New York.  The EEOC replaced the Department of Justice as prosecuting counsel in 1974.

Pursuant to the settlement, Local 28 will initially pay over $4 million in damages to journeypersons harmed by the discrimination and then contribute additional millions to a settlement fund over the next five years.  The plaintiffs estimate that total payments will reach about $12.7 million, assuming that work levels remain at or near recent levels.  Judge Lewis A. Kaplan will hold a Fairness Hearing regarding approval of the settlement on July 14, 2015 at 4:30 p.m.  As part of the settlement, Local 28 also agreed to comprehensive reforms designed to equalize work opportunities for non-white and white union members.  These include improved monitoring and investigation of discrimination complaints, an expansion of the use of the union's referral hall to guarantee non-discriminatory hiring decisions, increased education and training opportunities for members, and increased monitoring, analysis, and reporting of potential work-hours disparities by the union to EEOC and other plaintiffs.

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