A sports fashion chain that does business in Chicago and the surrounding area has agreed to pay $420,000 to settle a race and national origin discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission, the agency said Friday.
The chain, Palm USA Inc., which operates as City Sports, has denied the charges, and said it settled the case to avoid incurring additional litigation costs.
The EEOC said in its statement that City Sports, which has 15 stores, refused to promote African Americans and Hispanics into management positions and favored instead Koreans to fill management roles. The EEOC said the chain also subjected two black sales representatives to harassment because of their race.
The company, which was charged with violating Title VII of the Civil Rights Act of 1964, will pay $420,000 to 19 current and former employees, and has agreed not to engage in race or national origin discrimination or retaliation, among other provisions of the settlement agreement, the EEOC said.
Julianne Bowman, the district director of the EEOC’s Chicago district office, said in a statement, “During its investigation, the EEOC found that most of the City Sports sales employees were African-American or Hispanic, while most of the store managers were Korean.
“The company generally hired Korean individuals from outside the company for store manager positions, while never considering Black or Hispanic sales people who had worked for the company for years.”
Palm USA said in a statement that it was “dragged into a lawsuit when three employees were terminated for cause but alleged it was because of their race and went to the EEOC with this misleading information.”
The company said it is “proud of the fact that its stores are primarily staffed by Black and Latinx employees, many of whom have been promoted within,” and that it will continue to promote Black and Hispanic workers to managerial positions.