EEOC Recently Brings Multiple Sex Discrimination/Sexual Harassment Suits Against Auto Dealers

By Randy Henrick - Regulatory and Compliance Attorney

 

2019 has brought scrutiny by the Equal Employment Opportunity Commission against auto dealers for alleged sexual discrimination and harassment.  The EEOC’s actions suggest the agency is looking to make its mark by closely examining complaints filed by dealership personnel or applicants against dealerships across the country alleging unlawful discrimination or harassment based on sex or race.  A sexual discrimination or sexual harassment complaint are the most common legal actions a dealer will face.

In August, the EEOC filed a sexual harassment claim against a Nevada dealership.  According to the agency, the dealership created a hostile workplace for women.  The commission's investigation found "very open and flagrant" sex discrimination in a workplace so hostile that the saleswoman who filed the complaint had to quit to escape the abuse six months after she was hired, the lawsuit said. A male employee earlier filed a complaint with the commission, alleging he witnessed repeated discrimination at the dealership as well.

In September, the EEOC sued a recently acquired Oklahoma dealership that offered positions to all but one of the seller’s sales staff.  The one person not offered a position was the only female on the sales staff and had received awards from the seller for her performance.  The EEOC cited statements from the new dealership owner to the effect that vehicle sales are not a woman’s job for its claim that the dealer violated Title VII of the Civil Rights Act which prohibits discrimination based on sex.

The agency seeks money damages (including front pay and back pay), training on anti-discrimination laws, posting of anti-discrimination notices at the worksite, and other injunctive relief.

Earlier this year, the EEOC sued a dealership when the general manager at a Maryland store repeatedly made derogatory comments to a sales consultant who is of South Asian origin and is dark-skinned.  Although the sales consultant objected, the comments persisted, sometimes in the presence of others.  In addition to the demeaning names, the general manager even threw things at him.  On one occasion, the general manager groped the sales consultant while calling him a “serial killer” and “creepy brown person.”   The general manager asked the sales consultant who he was going to kill and where the bodies were buried, the EEOC charges.

The sales consultant felt traumatized and as a result took a leave of absence.  He complained to the dealership’s human resource director.  After a purported investigation, the HR officer told the sales consultant either would have to continue reporting to the general manager or transfer to another dealership an hour away.  The EEOC says that the sales consultant was forced to resign based on the dealership’s inadequate response to the unlawful harassment. 

The EEOC filed suit in federal court in Maryland after first attempting to reach a pre-litigation settlement through its conciliation process.

 

Randy Henrick is a 30-year expert in consumer protection laws and auto dealer sales and F&I compliance.  He worked for 12 years for Dealertrack, Inc. as their regulatory and compliance attorney, wrote all of Dealertrack's Compliance Guides, and has extensive experience in all aspects of front-end compliance.  Randy spoke at the 2015 - 2018 NADA national conventions and speaks to industry and trade associations on regulatory and compliance best practices for dealer risks.  The combined experience of the Ignite team across several disciplines allows them to develop strategy, overcome internal obstacles and implement meaningful change. Please contact info@IgniteCP.com to learn more.  

 

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