The U.S. Equal Employment Opportunity Commission (EEOC) said on Monday that 3M Co. has agreed to pay $3 million to settle an age-discrimination lawsuit filed by the agency. It is the third age-discrimination lawsuit 3M has settled this year.
The EEOC charged that 3M unlawfully laid off hundreds of employees over the age of 45 from July 1, 2003, through Dec. 31, 2006. 3M laid off many highly paid older employees, apparently to save money, and cut workers in salaried positions up to the level of director, the agency said.
Pending judicial approval, the settlement will be paid to approximately 290 former employees, and 3M will post openings for positions it had not advertised previously to enable older employees to apply. The company agreed to establish a review process for termination decisions and to conduct training on how to prevent age bias.
In March, 3M announced it had reached a preliminary settlement of $12 million on a suit filed in Minnesota in 2004. That case affected as many as 7,000 current and former employees. The company reached an undisclosed agreement this spring in a separate case filed in 2009 in San Jose, Calif.
The settlement with the EEOC "is not an admission of any liability," said 3M spokeswoman Donna Runyon, adding that the agreement allows 3M to avoid ongoing investment in time and legal expenses.
"3M denies the allegations in the suit," Runyon said. "We believe our human resource practices are fair, comply with federal and state laws and are widely recognized as best in class."
According to an EEOC investigation based out of the San Francisco office, older employees at 3M were denied leadership training and laid off to make way for younger leaders, according to the agency, which is responsible for enforcing federal laws prohibiting employment discrimination.
The agency's investigation found an employee e-mail describing then-CEO Jim McNerney's "vision for leadership development" as "we should be developing 30-year-olds with general manager potential."
"He wants us to tap into the youth as participants in the leadership development," according to the e-mail.
The Age Discrimination in Employment Act protects people aged 40 and older from employment discrimination.
"The law requires employers to base employment decisions upon each person's strengths and talents instead of relying upon generalized assumptions calculated around an employee's age," said the EEOC's Michael Baldonado.