Dial in talks to settle sexual harassment case

Soap firm faces huge fine over treatment of women

April 29, 2003|By BLOOMBERG NEWS

CHICAGO - Dial Corp., maker of Dial soap and Purex detergent, is in talks to settle sexual harassment allegations by the U.S. Equal Employment Opportunity Commission, postponing a trial that was due to start yesterday.

Dial might lose as much as $27 million if the U.S. wins the biggest sexual-harassment case since Mitsubishi Motor Manufacturing of America Inc. paid a record $34 million in 1998 to settle similar allegations, a government attorney said. The Dial suit was brought on behalf of 91 female workers.

The company, based in Scottsdale, Ariz., is accused of creating a "permissive culture" in which men harassed women at an Illinois soap factory, the EEOC claims. The lawsuit says Dial tolerated displays of pornography, lewd remarks, threats, stalking and physical assaults at the plant.

"There are rather delicate settlement negotiations going on at this point," EEOC lawyer John Knight said.

Camille Olson, the Chicago lawyer representing Dial, said both sides asked U.S. District Judge Warren K. Urbom in Chicago to postpone the trial for at least a day. She said it would begin tomorrow if the talks fail.

Dial shares rose 16 cents to close at $20.56 on the New York Stock Exchange.

Cindy Demers, a Dial spokeswoman, said the company takes the sexual harassment allegations seriously and denied the EEOC's allegation that tolerating harassment is "standard operating practice" at Dial's only soap-making plant. The plant, about 50 miles southwest of Chicago in Montgomery, Ill., makes about 2.3 million bars of soap a day, Demers said.

EEOC lawyers said harassment hasn't stopped since the suit was filed in 1999.

Damages are limited to $300,000 per person under federal law, which would work out to a maximum of $27.3 million for 91 women if Dial loses.

More women might be added to the suit if it's proven that Dial tolerated a hostile workplace. EEOC attorney Noelle Brennan said one-quarter of all female employees at Dial since 1988 have testified under oath that they were sexually harassed.

In addition to financial damages, the EEOC wants the court to order outside monitoring to make sure Dial prevents future harassment. A similar monitoring procedure was put in place at Mitsubishi's factory in Normal, Ill.

The commission claims that women who reported harassment were blamed, ignored or subjected to retaliation.

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