Dive Brief:

• Caterpillar will pay $800,000 in back wages and interest to resolve claims of alleged hiring discrimination at its Decatur, Illinois, facility, according to a May 21 Department of Labor press release.
• The Labor Department found that Caterpillar discriminated against 60 Black applicants who applied for fabrication specialist and welder positions between March 30, 2018, and March 30, 2020.
• As part of the agreement, the equipment manufacturing company will compensate the affected individuals and offer jobs to 34 eligible applicants. Caterpillar will also revise its hiring policies to eliminate discrimination and train those who oversee hiring processes.

Dive Insight:

Caterpillar said in an emailed statement to Manufacturing Dive that it’s fully cooperating with the agency on the matter. 

“While the agency has not issued any violations against us, we have signed an early conciliation agreement to resolve their questions,” the company said in the statement. “The questions raised and the conciliation agreement are not a reflection of the current state of our hiring practices, and Caterpillar remains committed to creating a workforce that respects and celebrates diverse backgrounds, experiences, and perspectives.”

The Labor Department highlighted that Caterpillar broke Executive Order 11246, which prohibits federal contractors from discriminating based on race, sex, color, religion, sexual orientation, gender identity or national origin. 

Caterpillar holds multiple contracts with the government, including $481 million in federal contracts since 2018 and machinery manufacturing contracts with the U.S. Army, according to the press release.

The Decatur factory employs nearly 5,000 employees during a peak year, according to a University of Illinois blog.

The Caterpillar settlement is one of several federal contractors that have had recent hiring discrimination lawsuits.

In February, GE Aerospace paid $443,000 for allegedly discriminating against female operations associate applicants at its Rutland, Vermont, facility. Last October, global arms manufacturer Olin Corp. agreed to pay $630,000 to resolve alleged hiring discrimination against 286 Black and women applicants in Mississippi.

HVAC system maker Daikin Industries also had to pay $100,000 to settle race-based discrimination against 98 Black applicants at a Virginia plant last October.