LITTLE ROCK — Baldor Electric of Fort Smith has agreed to pay $2 million in back wages and interest to settle allegations of systemic discrimination against women and minorities in its hiring practices, the U.S. Department of Labor said Monday.
The company said no complaint was ever filed by job applicants and that the allegations were based solely on a statistical model.
The Labor Department’s Office of Federal Contract Compliance Programs said Baldor’s applicant screening process resulted in 795 qualified female, black, Asian and Hispanic job applicants being rejected for interviews for production and laborer positions.
In addition to the financial payment, Baldor will offer jobs to at least 50 applicants previously rejected as positions become available, the Labor Department said.
“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,” Hilda Solis, U.S. labor secretary, said in a news release.
The company also agreed to put monitoring efforts in place, including record-keeping requirements, to ensure future compliance with the law.
Mike Trupo, a Labor Department spokesman, said the group of applicants previously rejected for interviews had not attained legal status to pursue a class-action lawsuit against Baldor.
Tracy Long, a Baldor spokesman, said the complaint was a result of “how they [the Labor Department] do their business” with statistical models.
“We don’t feel like there was any wrong doing in our hiring practices,” she said. “We’ve never had such a situation arise.”
Baldor is owned by ABB Ltd. of Switzerland, which makes industrial motors, generators, circuit breakers, switch gear, transformers and other power systems. The Labor Department said Baldor currently has federal contracts worth $18 million with the General Services Administration, Department of Veterans Affairs and Department of Justice.
In the recent past, it also has had federal contracts to produce batteries and generators.
According to its website, ABB operates in more than 100 countries, with offices in 87, and employs about 145,000. Its North American headquarters is in Cary, N.C.
In January 2011, ABB Ltd. of Zurich completed its tender offer for Baldor. It bought the Arkansas firm for $63.50 a share, a 41 percent premium over Baldor’s closing price as of Nov. 29, 2010, the last day of trading before the $4.2 billion deal was announced.
Business, Pages 23 on 06/26/2012