Louisiana residents may be entitled to compensation from a newly established settlement fund intended to compensate women who were denied employment by contractors working on the Deepwater Horizon cleanup effort. The settlement marks an end to U.S. Equal Employment Opportunity Commission’s investigation of BP Exploration and Production, Inc. The EEOC began its investigation after receiving complaints from several women alleging that certain contractors refused to hire them exclusively because of the women’s gender. The EEOC described the agreement as a voluntary effort that will avoid protracted employment litigation.

The EEOC issued no findings of employment law violations, and BP denies any discriminatory practices on its part. BP characterizes the settlement as a partnership with the EEOC to ensure that any emergency contractors the company may employ in the future will share its commitment to compliance with federal anti-discrimination laws.

In addition to establishing a settlement fund of up to $5.4 million, the agreement also requires BP to incorporate anti-discrimination provisions in future contracts and to implement training programs for corporate contract administrators. BP also agreed to designate an employee to oversee compliance with the settlement terms.

The settlement fund covers a class of women in four states, including Louisiana. Women who believe that gender played a role in the hiring decisions of a BP contractor may submit claims to seek inclusion in the class of settlement beneficiaries..

In light of the recently concluded EEOC investigation, Louisiana businesses may want to take a second look at their contractual agreements with third-party service providers. In this case, the discrimination claims all involved independent contractors, but BP bore the brunt of the investigation and the costs of settling to avoid litigation.

One can only speculate whether BP would have been held liable for contractor violations if the case had gone further, but any company involved in an EEOC investigation risks unnecessary expenses and damage to reputation regardless of any finding of liability. When it comes to the employment practices of third-party contractors, Louisiana companies may be well advised to err on the side of caution.

Source: The Louisiana Weekly, “BP pays to settle gender discrimination claims,” July 2, 2012