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Press Release 06-28-2016

IFCO Systems Will Pay $202,200 In Landmark Settlement Of One Of EEOC's First Sexual Orientation Discrimination Lawsuits

Company Fired Worker Who Complained About Sexual Orientation Harassment, Federal Agency Charged

BALTIMORE - The U.S. Equal Employment Opportunity Commission (EEOC) announced today that Pallet Companies, doing business as IFCO Systems, will pay $202,200 and provide significant equitable relief to settle one of EEOC's first lawsuits alleging sex discrimination based on sexual orientation.

EEOC charged that a lesbian employee at IFCO's Baltimore facility was repeatedly harassed by her supervisor because of her sexual orientation. Her supervisor made numerous comments to her regarding her sexual orientation and appearance, such as "I want to turn you back into a woman" and "You would look good in a dress," according to the suit. EEOC charged that the supervisor also made sexually suggestive gestures to her. IFCO retaliated against the female employee by firing her just days after she complained to management and called the employee hotline to report the harassment, according to the suit.

Title VII of the Civil Rights Act of 1964 prohibits discrimination because of sex and retaliation. As the federal law enforcement agency charged with interpreting and enforcing Title VII, EEOC has concluded that harassment and other discrimination because of sexual orientation is prohibited sex discrimination. EEOC filed suit in U.S. Court for the District of Maryland, Baltimore Division (EEOC v. Pallet Companies, d/b/a IFCO, Civil Action No. Case 1:16-cv-00595-CCB). On the same day, EEOC also filed an unrelated suit against Scott Medical Health Center in U.S. District Court for the Western District of Pennsylvania (Case 2:16-cv-00225-CB), alleging discrimination based on sexual orientation. EEOC filed both lawsuits after first attempting to reach a voluntary pre-litigation settlement through its conciliation process.

"This consent decree marks EEOC's first resolution of a suit challenging discrimination based on sexual orientation under Title VII," said EEOC General Counsel David Lopez, "EEOC is committed to ensuring that individuals are not subjected to discriminatory treatment in workplaces based on their sexual orientation and looks forward to the day that this fundamental right is widely recognized."

The two-year consent decree requires IFCO to pay $182,200 in monetary relief to the female employee and donate $20,000 to the Human Rights Campaign Foundation to support the Human Rights Campaign's Workplace Equality Program. The decree enjoins IFCO from engaging in sex discrimination or retaliation in the future. The company will retain an expert on sexual orientation, gender identity, and transgender training to assist in developing a training program for IFCO's top managers, supervisors and employees on LGBT workplace issues. IFCO will also distribute its equal employment opportunity policies and toll-free employee hotline number and Web address to all employees in its north region. The company will provide the female employee with a letter of reference. Finally, IFCO will also post a notice about the settlement and report to EEOC on its compliance with the decree, including how it handled any complaints of sexual orientation discrimination.

EEOC Philadelphia District Director Spencer H. Lewis, Jr. said, "EEOC is committed to ensuring that no employee or applicant is discriminated against or harassed based on sexual orientation."

EEOC Regional Attorney Debra M. Lawrence added, "We commend IFCO for working with us to resolve this case amicably and without engaging in protracted litigation. In addition to the monetary relief, this landmark settlement ensures that all IFCO employees and applicants are protected against discrimination because of sexual orientation. We encourage other employers to follow IFCO's example and implement similarly comprehensive policies and training programs to prevent workplace discrimination against members of the LGBT community."

Addressing emerging and developing issues, especially coverage of lesbian, gay, bisexual and transgender individuals under Title VII's sex discrimination provisions, is one of six national priorities identified by EEOC's Strategic Enforcement Plan. The agency has posted materials on its website relating to coverage under Title VII for LGBT individuals. In addition, in June 2015, the agency, in coordination with the Office of Personnel Management, Office of Special Counsel, and the Merit Systems Protection Board, developed a guide for federal agencies on addressing sexual orientation and gender identity discrimination in federal civilian employment.

EEOC's Philadelphia District Office has jurisdiction over Pennsylvania, Maryland, Delaware, West Virginia and parts of New Jersey and Ohio. EEOC Philadelphia District Office attorneys also prosecute discrimination cases arising from Washington, D.C. and parts of Virginia.

EEOC enforces federal laws prohibiting employment discrimination. Further information about the agency is available at its website,