EEOC Sues Insurance Auto Auctions For Racial Harassment

FREMONT, Calif. - Vehicle auctioneer Insurance Auto Auctions, Inc. (IAAI) violated federal law by tolerating racial harassment of a Black employee who was eventually forced to resign, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit filed today.

According to the EEOC's suit, a yard attendant at the company's Fremont, California, facility endured constant racial slurs, including the "n-word," up to 15 times a day by co-workers for over a year. This verbal harassment occurred openly in front of the general manager who failed to take adequate steps to curb the misconduct, despite directly observing it. A manager was even told by several employees that it was acceptable to say the "n-word" in the Bay Area. The Black employee was left feeling he had no choice but to quit to escape the hostile work environment.

The alleged conduct violated Title VII of the Civil Rights Act of 1964, which prohibits harassment due to race and requires employers to take prompt action to investigate and stop the misconduct after they receive notice of it. The EEOC filed suit (EEOC v Insurance Auto Auctions, Inc. Case No. 4:24-cv-06848) in U.S. District Court for the Northern District Court of California after first attempting to reach a pre-litigation settlement through its administrative conciliation process.

"Let me be clear: there is no workplace, regardless of locale, where the use of racial slurs is acceptable," said EEOC San Francisco District Director Nancy Sienko. "Once an employer lets that standard slip, not only are you giving permission for an unprofessional, unproductive and hateful work environment, you are violating the law."

EEOC Senior Trial Attorney James H. Baker said, "This lawsuit sends a strong message that the EEOC will continue to vindicate the rights of those with the courage to step forward to report discrimination against themselves or others in the workplace."

In fiscal year 2023, the EEOC recovered over $75 million for violations of Title VII involving race harassment. For more information on the EEOC's efforts to address race harassment, please see the agency's Select Task Force report on workplace harassment.

The suit was brought by the EEOC's San Francisco District Office, which has jurisdiction over Northern California, Nevada, Oregon, Washington, Alaska, Montana, and Idaho. The San Francisco District has offices in Oakland, San Francisco, San Jose and Seattle.

The EEOC prevents and remedies unlawful employment discrimination and advances equal opportunity for all. More information is available at www.eeoc.gov. Stay connected with the latest EEOC news by subscribing to our email updates.