Baldor to Pay $2 Million in Back Wages, Offer Jobs in Discrimination Settlement

The U.S. Department of Labor said Monday that it has reached a $2 million agreement with Baldor Electric Co. of Fort Smith to settle a hiring discrimination case.

The settlement agreement includes back wages, interest and some job offers for 795 women and minority applicants who were denied positions at the company, which makes electric motors and drives and is owned by ABB Ltd. of Zurich, Switzerland.

In a news release, the Labor Department's Office of Federal Contract Compliance Programs said its investigators had determined that Baldor's applicant screening process created "a disparate impact on women and minorities."

"As a result, 795 qualified women, African-Americans and job seekers of Asian and Hispanic descent were denied the opportunity to advance to the interview stage when applying for production and laborer positions," the Labor Department said. 

Baldor told The Associated Press that it was easier to settle than continue to fight the allegation.

"It was going to be a much lengthier process to fight it any longer. We don't admit that we've done anything wrong. This was purely a statistical analysis on their (the Labor Department's) part. But it would have been so long and so much more expensive to fight, it was just time to be done," Baldor spokeswoman Tracy Long said.

Long said the company has been defending itself since the Labor Department raised the issue over Baldor's 2006 employment applicant screening data.

"We've ensured that the screening process is in compliance with the Department of Labor's expectations. We've had lot of time to work on it," Long told The AP. She said compliance is important to the company.

"We've always done the right thing," she said.

The Arkansas Economic Development Commission lists Baldor as the state's 26th largest employer with between 2,000 and 2,500 workers.

The Agreement

Under terms of a conciliation agreement negotiated by the OFCCP, Baldor will pay $2 million in back wages and interest to the affected individuals and make at least 50 job offers to members of the original class action lawsuit as positions become available.

The company also has agreed "to undertake extensive self-monitoring measures to ensure that all hiring practices fully comply with the law, including record-keeping requirements," the Labor Department said.

"I am pleased with this settlement, which reflects a mutual commitment between the Department of Labor and the leadership of Baldor to ensure that all workers have a fair and equal shot at competing for good jobs," Secretary of Labor Hilda L. Solis said in a news release.

"Our shared goal is to create lasting change so that anyone who comes looking for work at Baldor can be sure that discrimination will never be a factor in determining who gets the job," she said.

According to the Labor Department, Baldor holds federal contracts worth more than $18 million with the General Services Administration and the U.S. departments of Veterans Affairs and Justice. It said that from 1997 to 2010, Baldor received $79 million to produce batteries and generators for federal agencies including General Services Administration, the Justice Department and the Army.

(The Associated Press contributed to this report.)