Yet another company has been caught in a discrimination claim when it comes to background checks used during the hiring process. Baldor Electric Co. has agreed to pay $2 million to settle a U.S. Department of Labor Office of Federal Contract Compliance Programs discrimination claim based on their employee background check policy. The company denied bias in its settlement. Baldor holds more than $18 million in federal contracts and is owned by ABB Ltd. in Zurich, Switzerland.
The Labor Department investigation determined that Baldor’s background screening process had a disparate impact on women and minorities. The result of those screening protocols was that 795 qualified women and minorities were not given the opportunity to advance to the interview stage of the hiring process. The company has been defending itself since the Labor Department raised the issue over Baldor’s 2006 employment applicant screening data.