A Mahtomedi drywall contractor has agreed to pay a group of Latino workers $2.5 million in a discrimination settlement that was recently approved by a federal judge.
Attorneys for the workers on Monday announced the settlement with Mulcahy Inc. and owner Gary Mulcahy. While the suit had a potential class of 290, attorneys said 41 workers will share the settlement money, which works out to be about $1.7 million after attorneys fees and other expenses are covered.
Latino workers first filed discrimination complaints with the Equal Employment Opportunity Commission in 2007. They then filed a class-action fair-pay lawsuit in 2008.
Besides agreeing to pay the workers, their attorneys said the commercial drywall contractor has agreed to make changes to its operations to ensure all workers are paid fairly.
Bill O'Brien, an attorney for the plaintiffs, said the Latino workers were paid less than their non-Latino counterparts and were often not paid the overtime wages they deserved. According to the lawsuit, the pay some Latino workers took home amounted to less than minimum wage for the number of hours they worked.
"The principal concern is that their hours were fundamentally underreported," O'Brien said, adding that the Latino workers also didn't receive the same benefits as other workers. "The non-Latino counterparts were getting a union wage and union benefits, and the Latino workers were not. The difference was fairly dramatic."
An attorney for Mulcahy, Lindsay Zamzow, said in a written satement that the company decided settling the lawsuit made the most sense.
"Class action cases like this are extremely time consuming and expensive. Mulcahy, Inc. made a business decision that it believes was in the best interest of all involved," she said.
According to the settlement agreement approved Friday, Mulcahy and his company must put money into the settlement fund by January 2011. If they don't, the amount of the settlement could rise to up to $6 million if paid over five years, O'Brien said.
O'Brien said his law firm, Miller O'Brien Cummins, is pursuing several other similar cases against other employers, but this is the first settlement reached. He said it was important to reach an agreement that acknowledged and compensated the workers.
"The employment laws of our country apply to everyone, no matter where you come from," O'Brien said. "We're hoping to send a message that these are cases well worth pursuing."