Two of the largest automakers in the world General Motors (GM) and Stellantis (STLA) have been hit with discrimination claims by a U.S. government agency.
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The U.S. Equal Employment Opportunity Commission (EEOC) on Friday, January 17th, sued the two companies, accusing GM and the United Auto Workers (UAW) union of age discrimination, and alleging sexual discrimination at a Detroit plant run by STLA.
GM and UAW “Violated Federal Law”
The EEOC said GM and UAW violated federal law when they negotiated a collective bargaining agreement which limited short-term disability payments to older workers who receive Social Security Retirement benefits.
Since at least 2019, the agreement between the parties provides for GM to pay weekly benefits to employees who miss work due to sickness or injury.
But the EEOC claims GM paid less to employees who were entitled, by their age, to full retirement benefits through the Social Security program, leaving workers aged 66 and older with fewer benefits than younger coworkers.
STLA Also Hit by Claim
Meanwhile, the EEOC alleges female employees at a Stellantis assembly complex in Detroit were sexually harassed. The agency named FCA US, LLC, a subsidiary of Stellantis, in the claim.
It says that after being harassed by male supervisors and coworkers, the company failed to act properly even after some of the women complained to bosses.
“Employers cannot normalize offensive sex-based misconduct,” said EEOC Trial Attorney Karen Brooks.
Is GM a Good Stock to Buy?
Overall, Wall Street has a Moderate Buy consensus rating on GM stock, based on eight Buys, five Holds and two Sells. After rising 45% in the last 12 months, the average GM price target of $58.60 implies about 15% upside potential from current levels.
