News item: Novellus Systems agreed to pay $168,000 to an African-American assembly technician who claimed he was fired after he repeatedly complained to management about a Vietnamese-American co-worker. The co-worker played rap music on the factory floor and rapped along with the music’s lyrics, which included language that the African-American employee considered racially offensive. Management apparently took no action on the issue, which led to the US Equal Employment Opportunity Commission (EEOC) suing the semiconductor production equipment manufacturer last September for racial harassment.

The company settled the case without admitting any wrongdoing and agreed to amend its anti-harassment policy to prohibit the playing of music with offensive lyrics, with specific examples to be provided in the policy.

Seems pretty cut-and-dried for a case in employment law — a colorful example, you could say. What the news coverage doesn’t tell, and it’s unlikely that Novellus will either, is exactly how the company’s managers treated this case. On the face of it, the case indicates managerial indifference and possibly incompetence — failures that cost Novellus $168,000. That’s not much money for a company that last year posted net income of $213.7 million on sales of $1.57 billion. Still, I bet that $168K is more than the salary of the manager who told the unhappy employee to “Just ignore him” or “Get over it.” And I bet that manager didn’t inform his or her bosses of the problem until the situation escalated, when HR and legal executives had to respond to inquiries from EEOC investigators. I bet that manager is now an ex-manager of Novellus Systems, so the company saved that person’s salary toward paying the judgment. Of course, the whole episode cost Novellus a lot more than $168,000, factoring in the legal fees, distraction of management time, and extra work for HR. Maybe a few people got fired as a result. So, there’s a ripple effect of consequences.

I feel personally disappointed in Novellus, because I’ve covered the company since its founding in 1984 and interviewed its senior executives on many occasions. Brad Mattson was among the founders of Novellus, and he went on to establish Mattson Technology and other firms. Bob Graham convinced his employer at the time, Applied Materials, to buy Novellus in 1986; the deal was called off, however, as a corporate turf war broke out. When management decided to go with Applied’s internally developed deposition system over the Novellus design, Graham quit the company and joined Novellus as its president and CEO. He retired in 1996 and died in 1998; his achievements are annually commemorated by the Semiconductor Equipment and Materials International trade group with the Bob Graham Award, which goes to an executive who has shown distinctive marketing and sales acumen, something Graham had in abundance. Rick Hill, the current chairman and CEO of Novellus, is a tremendously talented executive whose experience was forged in the fires of Tektronix, the perpetually embattled instrument maker.

The resolution of this episode comes in an election year that features the first African-American presidential nominee of a major party. We’re going to have a national dialogue on the racist history of the US as a result, although many would prefer to look forward, rather than backward. Bigotry is being linguistically recast as “lower racial sensitivity,” a term that puts a genteel front on racial resentment and hatred. Maybe we should first lighten up on the language, which does carry emotional baggage. The comedian Mike Birbiglia jokes that only white people are allowed to call each other “crackers” — as in “Cracker, please!” or “Cracker what!?” A smile is a good place to start. Then, we can move on to the more important work of achieving mutual respect in the workplace, and everywhere else in the US.

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