3M to Pay $3M to Settle Age Discrimination Lawsuit
3M Company has agreed to pay $3 million to roughly 290 former employees to settle an age discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC), the agency said Monday.
The lawsuit accused the Maplewood-based manufacturer of unlawfully laying off hundreds of employees over the age of 45 during a series of work force reductions that took place between July 1, 2003 and December 31, 2006.
The company allegedly laid off highly paid older employees in order to save money and cut workers in salaried positions up to the level of director.
Additionally, older workers were allegedly denied leadership training and laid off to make way for younger leaders. The EEOC said that its investigation found an employee e-mail describing former CEO Jim McNerney's “vision for leadership development” by saying, “We should be developing 30-year-olds with general manager potential” and “He wants us to tap into the youth as participants in leadership development.” (McNerney led the company from 2001 to 2005.)
In addition to providing monetary relief to employees as part of the settlement, 3M agreed to implement a review process for termination decisions and training on how to prevent age bias. The company also will post openings for positions that it had not previously advertised in order to allow older employees to apply.
Under the terms of the settlement, 3M must report to the EEOC about its compliance and provide work force reduction information to the EEOC over the next three years. The agreement is part of a consent decree that is pending judicial approval.
3M spokeswoman Donna Runyon said in an e-mailed statement: “The settlement is a compromise and allows the company to avoid ongoing investments in time and legal fees. It is not an admission of any liability.”
She added: “3M denies the allegations in the suit. 3M's human resources practices are fair, comply with federal and state laws, and are widely recognized as 'best in class.'3M has been repeatedly recognized for the quality and breadth of its leadership development programs, which train employees around the world.As a global company, 3M needs and values contributions from all of its employees as it seeks to thrive in competitive markets worldwide.”
In March, 3M said that it reached a preliminary settlement agreement under which it would pay up to $12 million to settle another age discrimination lawsuit that was filed in Minnesota in 2004 on behalf of 7,000 current and former employees. According to the Star Tribune, the company also reached an undisclosed agreement this spring on a separate age discrimination suit filed in San Jose, California.
The federal Age Discrimination Employment Act was designed to protect people age 40 and older from employment discrimination, and the EEOC enforces laws prohibiting employment discrimination.
3M is Minnesota's fifth-largest public company based on its 2009 revenue, which totaled $23.1 billion. The company reported revenues of $26.7 billion in 2010.