Daily News

View All News

Alabama firm to pay $5 million to guest workers

December 21, 2015

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 US Equal Employment Opportunity Commission, the agency announced Friday.

According to the lawsuit, Signal International LLC 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 violated Title VII of the Civil Rights Act of 1964 by subjecting 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, according to the EEOC.

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.

After Signal International filed for Chapter 11 Bankruptcy in Delaware, the settlement of EEOC’s suit and 11 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’s CEO issued a statement acknowledging the company’s wrongdoing and apologizing for its treatment of the guest workers.

“This lawsuit sends a powerful message that an employer must treat all workers equally without regard to their national origin or race,” said Delner Franklin-Thomas, district director for EEOC’s Birmingham District. “We are very pleased Signal has accepted responsibility for its wrongdoing and that these workers, who have waited 10 long years for justice, will now receive compensation and can move on with their lives. In many cases, these men paid thousands of dollars to come to the United States, only to be subjected to inhumane conditions and exploitation after they arrived.”