$5 Million Settlement in Race and National Origin Discrimination Lawsuit

Monday, December 21, 2015

Signal International, LLC, a Mobile, Ala. ship building and repair company, will pay an estimated $5 million to 476 Indian guest workers to settle a race and national origin discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC).

According to the lawsuit, Signal International recruited the workers from India through the federal H-2B guest worker program to work at its facilities in Texas and Mississippi in the aftermath of hurricanes Katrina and Rita. EEOC alleged Signal subjected the men to a pattern or practice of race and national origin discrimination, including unfavorable working conditions and forcing the men to pay $1,050 a month to live in overcrowded, unsanitary, guarded camps. As many as 24 men were forced to live in containers the size of a double-wide trailer, while non-Indian workers were not required to live in these camps.

Such alleged conduct violates Title VII of the Civil Rights Act of 1964 which prohibits discrimination in employment-including terms and conditions of employment--based on race or national origin. EEOC filed suit in federal court in Mississippi in 2011 after first attempting to reach a pre-litigation settlement through its conciliation process, and the suit was later transferred to the Eastern District of Louisiana (EEOC v. Signal International, LLC, No. 2:12-cv-0557).

After Signal International filed for Chapter 11 Bankruptcy in Delaware, the settlement of EEOC's suit and eleven related suits became subject to approval by the bankruptcy court. The settlement establishes a claims process and ensures that all aggrieved individuals included in the litigation may receive relief in spite of the bankruptcy proceedings. In addition to monetary relief, Signal International's CEO has issued a statement acknowledging the company's wrongdoing and apologizing for its treatment of the guest workers.

The EEOC is responsible for enforcing federal laws prohibiting employment dis­crim­ination. Protecting immigrant and other vulnerable workers from discrimination is one of the six national priorities identified by EEOC's Strategic Enforcement Plan. EEOC's Birmingham District consists of Alabama, Mississippi (except 17 northern counties) and the Florida Panhandle. 

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