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2013 Geneva Auto Show

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BMW is settling a federal lawsuit charging the company with racial bias in its use of background checks. The German auto manufacturer agreed Tuesday to pay $1.6 million and offer jobs to dozens of African-American applicants at its U.S. plant in Greer, South Carolina.

This federal Equal Employment Opportunity Commission lawsuit alleges that the luxury car maker’s use of background checks to screen applicants had an unfair impact on black candidates for reasons that weren’t job-related. BMW has denied the allegations saying it has a highly diverse workforce. This EEOC lawsuit claimed that roughly 100 existing employees who had to reapply for their positions in 2008, were “disqualified from employment” because they didn’t pass the company’s background check. According to the suit, 80-percent of those disqualified employees were African American.

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