United Parcel Service. Photo: ricochet64/Shutterstock.com

The United Parcel Service Inc. has agreed to pay $4.9 million to settle a class discrimination lawsuit in which the U.S. Equal Employment Opportunity Commission claimed that the company did not accommodate certain religious practices as required by federal law.

According to a news release announcing the settlement, UPS, headquartered in Atlanta,  prohibits male employees in a supervisory or customer contact position, which includes delivery drivers, from wearing beards or growing hair below collar length. The EEOC claimed that since at least January 2005, UPS would not hire or promote applicants whose religious practices of wearing beards or long hair conflicted with its appearance policy and wouldn't provide reasonable accommodation for them at its facilities throughout the United States. The EEOC further alleged that UPS would keep employees with beards or long hair for religious reasons away from customer contact positions.

The EEOC filed the suit (EEOC v. United Parcel Service) in the U.S. District Court for the Eastern District of New York in July 2015, claiming that UPS violated Title VII of the Civil Rights Act of 1964. U.S. District Judge Margo K. Brodie of the Eastern District of New York approved the five-year consent decree Dec. 21. Besides the $4.9 million settlement that UPS must pay to a class of current and former employees and applicants, the company also agreed to provide training to managers and supervisors and to publicize the right to religious accommodation on its websites, both internally and externally. The company also agreed to provide the EEOC with periodic reports of requests for religious accommodations.

“UPS's strict appearance policy has operated to exclude Muslims, Sikhs, Rastafarians, and other religious groups from equal participation and advancement in the workforce for many years. We appreciate UPS's willingness to make real changes to its religious accommodation process to ensure equal opportunity for people of all backgrounds,” said Elizabeth Fox-Solomon, the EEOC's lead trial attorney in the case, in a statement. It was not clear how many class members are involved in the suit.

In an emailed statement to American Lawyer Media, UPS said that it did not agree with the EEOC's asserted allegations, but settled so that the company would not be bogged down by the high cost of litigation.

“UPS is proud of the diversity of its workforce and does not tolerate discrimination of any kind. While UPS disagrees with assertions made by the EEOC, the company resolved this lawsuit because we choose to focus our energy on our hiring and promotion process, rather than lengthy and costly court proceedings. The decree resolves various claims by the EEOC and other parties, yet within it clearly states that, 'Nothing in this decree constitutes an admission by any party as to the claims and/or defenses of any other party,'” a spokesperson said in the email.

The statement continued, “UPS willingly agreed to additional training and enhancements to our religious accommodation process because it is wholly consistent with the company's deeply held diversity, inclusion and fair employment values. The company is pleased to have reached an expedient settlement and looks forward to continued recruitment, employment, development and promotion of all UPSers, as diversity of thought and practices results in a stronger company and enables an even greater contribution to the global communities we serve.”

A representative from the EEOC was not available for further comment because of the government shutdown.

Attorneys for the EEOC were Fox-Solomon, Andrea Chinyere Ezie, Nora E. Curtin, Kirsten J. Peters, Thomas Lepak and Jeffrey Burstein. UPS was represented by Wendy Johnson Lario of Greenberg Traurig in Florham Park, New Jersey.