EEOC settles precedent-setting sexual orientation discrimination case in Baltimore

In a landmark discrimination case, a packaging manufacturer will pay $202,200 to settle allegations that a lesbian employee was harassed because of her sexual orientation and fired from the Baltimore facility where she worked after reporting the behavior.

Pallet Companies, which does business as IFCO Systems, will pay $182,200 to the employee, Yolanda Boone, and donate $20,000 to the Human Rights Campaign Foundation's workplace equality program to settle the discrimination lawsuit brought by the U.S. Equal Employment Opportunity Commission.


In a statement following the settlement, IFCO denied any wrongdoing and said it is pleased with the outcome of the case.

"The allegations in the EEOC's complaint do not reflect Pallet Companies' culture and its core values," the company said in a statement. "Rather than litigate with the EEOC, we looked at ways we could enhance our pre-existing commitment to a productive and discrimination-free workplace."


The lawsuit, filed in Baltimore in March, alleged that Boone was repeatedly harassed by her supervisor because of her sexual orientation, with comments such as "I want to turn you back into a woman." The supervisor also allegedly made sexually suggestive gestures to her.

Boone was fired days after reporting the harassment to management, according to the lawsuit.

The Civil Rights Act of 1964 prohibits employers from discriminating against employees on the basis of sex, race, color, national origin and religion — but not sexual orientation. The commission argued that harassment based on sexual orientation is covered under the prohibition against discrimination based on sex.

The suit against Pallet was among the first sexual orientation discrimination lawsuits filed by the EEOC, which enforces federal workplace anti-discrimination laws. The commission also sued Pittsburgh-area Scott Medical Health Center in March over alleged harassment of a gay employee.

"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," David Lopez, the EEOC's general counsel, said in a statement.

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Maryland is among at least 30 states that prohibit at least some employers from discriminating against at least some members of the lesbian, gay, bisexual and transgender community in the workplace, according to the Human Rights Campaign. Hundreds of companies have adopted their own policies.

As a condition of the settlement, IFCO agreed to strengthen its discrimination policies.

The company will retain an expert on sexual orientation and gender identity to develop a training program for IFCO employees, including managers and supervisors. The company also agreed to distribute its employment opportunities policies, hotline number and website to employees. IFCO will post a notice about the settlement and report back to EEOC about how it handles any complaints of sexual orientation discrimination.


Equal rights leaders praised the settlement as precedent-setting in protecting workers from being discriminated against because of sexual orientation.

"This settlement recognizes the value of ongoing efforts by our Foundation's Workplace Equality Program to create more LGBTQ-inclusive policies and practices at companies across the U.S.," Mary Beth Maxwell, a senior vice president for programs, research and training at the Human Rights Campaign, said in a statement.