Federal government sues Maytag

Federal government sues Maytag
 
Date July 16, 2004
Section(s) Local News
Brief  
 
By PETER HUSSMANN

Editor

A federal lawsuit filed in Chicago on Thursday alleges Maytag Corp. discriminated against older workers when it shed its nationwide sales team of senior managers over the age of 50.

The suit, filed by the U.S. Equal Employment Opportunity Commission, alleges that Maytag violated federal age discrimination laws when it eliminated 13 of its 22 regional sales manager positions in 1999. Of 11 regional sales managers demoted to the newly created position of zone manager, eight were over the age of 50. Only one employee over 50 was able to retain his regional manager job, the EEOC complaint alleges.

EEOC attorney Ethan Cohen will lead the federal government’s litigation against Maytag. He said he hoped the class action lawsuit will result in Maytag being “enjoined from age discrimination practices in the future.”

“Demoting people because they have gray hair is just as illegal as doing so because they have brown skin,” he said. “In attempting to force out older workers, Maytag was not only depriving itself of some of its most productive workers, it was breaking the law. There’s nothing wrong with pushing change in the workplace, but it is wrong to assume that older workers will not be able to keep up with those changes.”

Cohen told the Associated Press that Maytag allegedly feared the workers would not be able to implement new computer-based sales procedures.

“They were stereotyping these workers believing they wouldn’t be able to manage these new methodologies,” Cohen told the AP.

Maytag Corp. spokesperson Lynne Dragomier said the lawsuit took the company “by surprise.”

“While Maytag has been involved in an individual case, this is the first we have learned of the broader allegations described in the EEOC’s news release,” she said. “We deny the allegations described. We will vigorously defend Maytag‘s position and decisions in this matter.”

An age discrimination charge by Matthew Max, a Chicago area sales representative, gave rise to the EEOC investigation and lawsuit. Max told the EEOC that the zone manager’s position was eliminated in a further restructuring in 2000, resulting in several older managers receiving further demotions and loss of pay. The EEOC’s investigation of Max’s charge revealed that in 2001, Maytag reversed course and increased the number of regional sales manager positions to 17. The older managers were denied reinstatement to their former positions. The new supervisor, age 33, subjected them to negative age-based comments and suggested they were too old to productively perform their jobs, the EEOC report states.

Max filed an individual lawsuit against Maytag for alleged age discrimination practices on Wednesday.

Jack Rowe, the director of EEOC’s Chicago district office who managed the agency’s investigation, said that two of the demoted managers eventually lost more than 25 percent of their incomes.

“Older workers are at a critical point in their careers,” he said. “Their ability to save for retirement and plan for future needs is more limited, and disruptions in their ability to earn have more serious consequences than if they faced such challenges earlier. It is now EEOC’s job to seek compensation for the victims of Maytag‘s alleged discrimination and to help ensure that such conduct does not recur.”

According to John Hendrickson, regional attorney in the EEOC’s Chicago office, the litigation comes after repeated efforts to conciliate the case and is intended to secure permanent change.

“We already know Maytag has reached private, confidential settlements with at least two of these managers,” he said, “but there is nothing to ensure that the discrimination is not repeated. We expect to correct that through this case.”

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