Car rental company pays $1.4M to settle lawsuit over discrimination

HONOLULU (AP) A car rental company has settled a federal lawsuit alleging that it discriminated against women because of their gender, with the U.S. Department of Justice agreeing to pay $1 million to settle a class action.

The settlement came Wednesday with a statement from a Justice Department spokeswoman saying it was “the right thing to do.”

The agreement with the Department of Insurance was announced in a federal court filing.

The Department of Labor has agreed to reimburse the car rental industry $10,000 in fees for its representation, said a Justice official.

“We hope this settles the matter for good,” said the official, who spoke on condition of anonymity because the settlement is private.

The Department of Health and Human Services is reviewing the matter.

The department’s Wage and Hour Division declined to comment.

The Justice Department said the settlement came after a yearlong investigation that examined complaints against two car rental companies that did business in the state.

The companies were the only ones that could provide proof that women were discriminated against in the workplace, the Justice Department’s complaint says.

The complaint alleges that the car companies, CarMax and CarRental, violated state and federal laws and the Fair Labor Standards Act by not paying women their equal pay for equal work.

It also said the companies discriminated against men by not providing equal pay to men for similar work.

“Women’s employment is at the heart of the settlement, and it reflects the government’s longstanding commitment to equal pay and fair treatment,” a Justice spokesman said in a statement.

The car rental firms were fined for violating the Fair Housing Act in California, and the Labor Department has said it will look into whether the companies violated federal law by refusing to rent cars to women.