Volkswagen and workers who were part of an age discrimination lawsuit against the company and the Chattanooga plant have reached a proposed preliminary settlement calling for changes in hiring and promotion procedures.
The proposed settlement filed in federal court in Chattanooga said it provides for comprehensive anti- discrimination training and education, safeguards against future discrimination and management training program reforms.
In addition, VW agreed to pay $995,000 in attorneys fees and costs, court papers said. Members of the settlement class don't waive or release claims for individual relief, according to court documents.
The collective action complaint filed in June 2018 against Volkswagen by the firm Sanford Heisler Sharp alleged the company engaged in companywide age discrimination against employees over the age of 50.
However, the proposed preliminary settlement said that VW "vigorously contested and denied these allegations — and continues to do so."
The complaint said that a June 2017 news release announced that the company would be making management changes to reduce the size and age of its staff by implementing a "partial early retirement scheme for employees born between 1955 and 1960."
In the complaint, plaintiff Jonathan Manlove, who was then 60, brought the suit on behalf of himself and similarly situated U.S. employees of Volkswagen AG and its subsidiaries.
The proposed preliminary settlement requires VW to implement or maintain significant programmatic measures and reforms, court documents said.
"One of the primary practices challenged in this litigation has been Volkswagen's allegedly subjective method of filling open positions, which allegedly enabled management to hand-select preferred younger candidates and bypass older workers," said the documents. "This settlement provides concrete measures to ensure that settlement class members are placed on an equal playing field."
The preliminary settlement requires VW to ensure that employees have multiple means of reporting perceived discrimination, including bypassing an employee's direct supervisor.
In addition, the court agreement provides that VW will take steps to prevent discrimination by training and informing its management employees in Chattanooga, including employees transferred to the city from Germany.
Volkswagen will ensure that eligible employees have the opportunity to apply and be evaluated for participation in management training programs on an equal basis regardless of age, court documents said.
The proposed settlement must still be approved by U.S. District Court Judge Travis McDonough.
Attorneys for Manlove didn't return a request for comment.
VW Chattanooga spokeswoman Amanda Plecas said that resolving the matter is in the best interest of its employees and the company.
"Volkswagen made no admission of any wrongdoing by entering into the settlement, and the settlement expressly provides that it is neither an admission of, nor evidence of, any liability or wrongdoing," she said. "If approved by the court, the settlement will provide for a complete resolution of the lawsuit."
At the time of the suit, Manlove was a former supervisor in Volkswagen's Chattanooga plant. Three days after the company issued the 2017 news release, he was informed by human resources that he would be demoted from assistant manager to supervisor, the position he had when he joined the company in 2011, the complaint alleged. He was also transferred "on loan" to a position in a different department, it said.
A human resources representative told Manlove he had one year to find a new assistant manager position within Volkswagen or his salary would be reduced, and his demotion and "on loan" status would become permanent, which could result in the loss of his company car, the complaint said.
But he was allegedly prevented from applying for any promotions, despite his manager recommending him for a promotion after a performance evaluation, according to the complaint.
Human resources reviews each performance evaluation and issues a final evaluation. The complaint alleged Manlove's assignment of "vertical" advancement status was changed to a "remain in position," preventing him from applying for any other position within the company for the next year.
A human resource representative later told Manlove that his advancement status had been entered in error, the complaint alleged. And while the company claimed to change his status to vertical, he was assigned a three-year status of "remain in position," meaning he is still ineligible for a promotion.
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