Insurance Auto Auctions to Pay $175,000 in EEOC Racial Harassment Lawsuit

FREMONT, Calif. — Vehicle auctioneer Insurance Auto Auctions, Inc. will pay $175,000 and provide injunctive relief to resolve a racial harassment lawsuit brought by the U.S. Equal Employment Opportunity Commission (EEOC), the federal agency announced today. 

According to the EEOC, a black yard worker faced racial harassment, including repeated racial slurs, by co-workers. Local managers were aware of the misconduct, but either ignored it or otherwise failed to take adequate steps to address it. The lawsuit also said that the employee was eventually forced to quit over the racial harassment.

Such alleged conduct violated Title VII of the Civil Rights Act of 1964, which prohibits racial harassment and requires employers to take prompt action to investigate and stop the misconduct after they receive notice of it. After first attempting to reach a pre-litigation settlement through conciliation, the EEOC filed its lawsuit (EEOC v Insurance Auto Auctions, Inc., Case No.:  3:24-CV-06848-TSH) in U.S. District Court for the Northern District of California.

Under the three-year decree settling the suit, Auto Auctions will pay $175,000 to the former employee and implement additional policies and procedures to bolster its compliance with Title VII; these include trainings for supervisors and managers on investigative techniques for racial harassment investigations.

“The EEOC commends Auto Auctions’ new ownership for its cooperation in resolving this case early in the lawsuit even though the harassment predated its involvement,” said Christopher Green, district director of the EEOC’s San Francisco District Office. “This settlement provides fair compensation for the employee, and long-awaited closure for both the worker and the company.”

EEOC Regional Attorney Roberta Steele said, “Employers must ensure that the supervisors they empower to enforce anti-employment discrimination policies actually do so. Failing to comply with equal employment opportunity laws can be costly.”

In fiscal year 2024, the EEOC recovered over $60 million for violations of Title VII involving racial harassment. For more information on harassment, please visit https://www.eeoc.gov/harassment.

The EEOC’s San Francisco District has jurisdiction over Alaska, Idaho, Montana, Oregon, Northern California, Northern Nevada and Washington.

The EEOC is the sole federal agency authorized to investigate and litigate against businesses and other private sector employers for violations of federal laws prohibiting employment discrimination. For public sector employers, the EEOC shares jurisdiction with the Department of Justice’s Civil Rights Division; the EEOC is responsible for investigating charges against state and local government employers before referring them to DOJ for potential litigation. The EEOC also is responsible for coordinating the federal government’s employment antidiscrimination effort. More information about the EEOC is available at www.eeoc.gov. Stay connected with the latest EEOC news by subscribing to our email updates.