Last week, more than a hundred South Carolina employees became eligible to receive millions of dollars from a settlement fund of $22.5 million.  A federal judge approved settlement of a lawsuit against a steel mill in Huger, S.C.  Nearly half of the settlement will go to the plaintiffs’ lawyers and the remainder will be allocated to eligible employees based on a settlement formula focusing on individual factors, including pay differentials allegedly due to lost promotions, and the frequency, severity, and duration of alleged racial hostility within the workplace.

In the lawsuit, current and former employees claimed that their employer, Nucor, discriminated against them because of their race.  The lawsuit became a class action covering approximately 150 workers who were employed between December 1999 through April 2011.  They alleged that the company failed to promote certain employees and created a racially hostile work environment through alleged statements and actions.  Nucor firmly denied those allegations and launched a vigorous defense, lasting nearly two decades and involving multiple appeals up to the U.S. Supreme Court.

Eventually, after 17 years of litigation, the parties reached a settlement, which the court approved last week.  Noting that the company very much denied the allegations, the parties entered into a settlement to end the litigation and extinguish the related claims.  In addition to the monetary settlement fund, the company agreed to:

• “[p]rovide comprehensive training on its non-discrimination/harassment policy to all employees, supervisors and managers . . .” on an annual basis;
• send “a copy of the non-discrimination/harassment policy to every employee annually”;
• communicate “the non-discrimination/harassment policy on the Company intranet;
• make sure that the company’s policy includes “that all complaints of discrimination and/or harassment will be investigated” and include other provisions related to reporting and investigating alleged discrimination;
• include in the policy “a prominent statement that employees can be terminated for racial harassment or hostility and/or for failing to timely or properly report racial harassment or hostility that has come to their attention”;
• require that all job vacancies, in hourly and salaried jobs, be posted within the facility for at least seven days; and
• list “selection criteria and job-related qualifications” in all job postings.

Settlements are not unusual, but multi-million dollar settlements in employment cases are very unusual.  This settlement reminds all employers that effective anti-discrimination policies, procedures, and training are essential.  Employers should consider contacting their legal counsel to make sure their policies and procedures are up-to-date.