Nike Settles Lawsuit Over Racial Discrimination At Chicago Store For $7.6 Million

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[July 31, 2007]

Nike Settles Lawsuit Over Racial Discrimination At Chicago Store For $7.6 Million

(InvesTrend Via Thomson Dialog NewsEdge)
July 31, 2007 (FinancialWire) Nike Inc. (NYSE: NKE) has reached a $7.6
million settlement in a class-action race discrimination lawsuit filed
on behalf of 400 black employees of the company's Chicago Niketown
store.
The lawsuit, filed in 2003, claimed managers at the retail store used
racial slurs to refer to black workers and customers. They also said
the store segregated black employees into lower-paying jobs as
stockroom workers and cashiers rather than giving them lucrative sales
jobs. The lawsuit also alleged that managers made unfounded accusations
of theft against black workers and directed store security to monitor
black employees and customers because of their race.
Nike has denied the allegations. Under the terms of the agreement, Nike
Retail Services will pay $7.6 million to the current and former
employees to resolve the claims. The lawsuit covers black employees who
worked at the store from 1999 to the present.
Nike must also make a host of other changes to address diversity, such
as appointing a diversity consultant to monitor the Chicago store's
compliance and a compliance officer at Nike's headquarters in
Beaverton. The company must also add an ombudsperson at the store and
conduct diversity training for all supervisors and managers there.
Nike is required to review its human resources practice, create equal
opportunity objectives for the store and review its theft-loss
policies. It also will create a formal mentoring program for black
employees.
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