Carrols Restaurant Group, Inc. (Nasdaq: TAST) today announced that its wholly-owned subsidiary, Carrols Corporation ("Carrols"), has entered into an agreement with the Equal Employment Opportunity Commission (“EEOC”) resolving longstanding litigation originally commenced by the EEOC in 1998.
The case, alleged that Carrols had subjected female employees working at its locations to sexual harassment in violation of Title VII of the Civil Rights Act of 1964, and attempted to establish a class action based on a claim of "pattern or practice" across its restaurants in 13 states. Throughout this litigation over the past 14 years, Carrols has strongly denied all the allegations of the complaint and vigorously defended itself against these claims.
In 2005, the Court dismissed the class or “pattern or practice” claims that the EEOC had brought on behalf of 90,000 female employees. The result of that decision and further rulings was to leave only a relative handful of individual claims to be resolved and a vindication of Carrols’ longstanding written policies and procedures.
Further litigation continued over the remaining claims, and in order to avoid ongoing litigation costs, Carrols has now entered into the agreement with the EEOC which fully resolves and settles all remaining claims without any admission of wrongdoing. Under the agreement, Carrols will make cash payments to the 89 remaining claimants in the lawsuit totaling $2.5 million, with allocations among the claimants being determined by the EEOC. Carrols agreed to continue to uphold its obligations under Title VII and continue to maintain its existing and comprehensive anti-harassment policies and procedures and training programs. It also agreed to make certain enhancements to such existing policies and procedures and training programs and to report on the results of its efforts to the EEOC over a 2 year period. The agreement with the EEOC is subject to court approval.