AG announces $1.6M settlement with McDonald’s franchisee over workplace sexual harassment

The Vermont Attorney General’s Office and the U.S. Equal Employment Opportunity Commission (EEOC) announced Friday, July 1, the approval of a settlement in Vermont’s first-ever joint state/federal employment discrimination lawsuit.

The settlement requires Coughlin, Inc, a McDonald’s restaurant franchisee, to pay $1.6 million in damages and state penalties and substantially reform its business practices under a five-year consent decree. Friday’s announcement marks the largest public sexual harassment settlement in the history of the Attorney General’s Office and one of the largest reported employment discrimination settlements in Vermont.

The collaborative litigation leading to the settlement began when the EEOC sued Coughlin, Inc. in March 2021 for failing to protect numerous young workers at its Randolph location from a manager who sexually harassed them over a period of years. The manager’s conduct included hitting, grabbing, and attempting to grab employees’ breasts, buttocks, and genitals, as well as making offensive and degrading sexual comments.

One of the victims, Jennie Lumbra, joined the suit, represented by attorney James G. Levins, Esq.

The Attorney General’s Office intervened in the matter based on its own history with Coughlin, Inc. In 2007, the Office’s Civil Rights Unit determined that Coughlin, Inc. violated Vermont’s Fair Employment Practices Act when it failed to address the sexual harassment of employees at a different McDonald’s restaurant. At that time, Coughlin, Inc. agreed to a settlement that required the business to comply with applicable laws, reform its policies and practices around sexual harassment, and provide training to staff. Given its prior involvement with the same employer, the Attorney General’s Office joined the EEOC in the present litigation to enforce both federal and state law protections against sexual harassment.

“This settlement sets the tone for employers to recognize their duty to keep workers safe, respect their dignity, and provide a workplace free of discrimination,” said Acting Attorney General Joshua Diamond. “I want to thank our federal partners at the EEOC and Assistant Attorney General Emily Chamberlain Adams for their work on this important matter. Ensuring compliance with non-discrimination laws is critical to creating a safe, respectful, and inclusive workplace.”

Under the terms of the five-year consent decree, Coughlin, Inc. will establish a settlement fund of $1.2 million to provide compensation to victims of the harassment at its Randolph restaurant. It will also pay $125,000 in civil penalties and other damages to the state of Vermont, and $275,000 in damages to the estate of Ms. Lumbra, who passed away during the pendency of this litigation. Coughlin, Inc. will also: (1) revise its policies and procedures around sexual harassment; (2) establish a hotline for employees to call regarding complaints of harassment; (3) provide training to all its employees and managers regarding sexual harassment in the workplace; and (4) be subject to compliance review by an independent monitor.

For additional information about sexual harassment in the workplace, contact the Civil Rights Unit of the Attorney General’s Office at (802) 828-3657 or ago.civilrights@vermont.gov.