Pa.’s Vanguard Mutual Fund to Pay $50K to Settle Race Bias Claim

March 6, 2008

The Vanguard Group, the nation’s second-largest mutual fund company, will pay $500,000 to settle a federal lawsuit alleging that management retaliated against a black employee who complained of race discrimination.

Raymond Ross, a Vanguard employee since 1993, received favorable performance reviews and promotions when he worked in the company’s information technology division, the federal Equal Employment Opportunity Commission said in its lawsuit.

In January 2002, Ross was transferred to a different department with new managers. Three months later, he complained he was being treated less favorably and discriminated against based on his race.

The suit alleged that, soon after, management retaliated with unfavorable changes in work conditions and assignments that eventually resulted in his termination in July 2003.

Under the consent decree announced by the EEOC, Vanguard will pay Ross $500,000. Vanguard also will draft an anti-discrimination policy, establish a procedure for reporting discrimination and retaliation complaints, and provide anti-discrimination training.

Valley Forge, Pa.-based Vanguard manages $1.25 trillion in mutual fund assets, including more than $350 billion in employer-sponsored retirement plans.

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