Education & Distance Learning Enthusiasts- Bank to distribute back pay to bias victims - Harris Bank of Chicago - Developments in Industrial Relations

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Bank to distribute back pay to bias victims - Harris Bank of Chicago - Developments in Industrial Relations - column

Monthly Labor Review - June 1, 1989

Bank to distribute back pay to bias victims

The Harris Bank of Chicago will distribute $14 million in back pay to some of its employees to settle charges of race and sex discrimination filed by the Federal Government. The payment is the largest of its kind in U.S. history.

The case began in 1973 when employees complained to the Department of Labor that Harris Bank discriminated against women and minorities in its pay, promotion, job placement, and training policies. The Department filed charges under Executive Order 11246, which imposes equal employment opportunity rules on employers of 50 workers or more who have Federal contracts totaling $50,000 in a year. Among other findings, the Department's action was based on the fact that Harris offered clerical jobs to some women with college degrees, while offering higher paid jobs and training to white male college graduates.

In 1981, an administrative law judge found Harris guilty of discrimination and ordered back pay. Harris appealed the ruling but, in 1986, another administrative law judge also ruled against the bank.

A Department of Labor official called the settlement "a major civil rights victory for the Federal Government" because it "provides an excellent precedent for future government action under the Executive Order." Observers maintain employees are better able to complete actions under the Executive Order than under the Civil Rights Act of 1964 because the Executive Order, unlike the Civil Rights Act, calls for legal costs to be borne by the government.

Harris Bank denied that it practiced discrimination, saying that it settled "to put the matter behind us."

The selection of employees and ex-employees who will receive payments, the size of payments, and the distribution of the money will be handled by the Department of Labor. The Department will also monitor Harris' commitment to establish training programs for women and minorities and to affirmative action.

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