By all accounts, Automation Personnel Services Inc. aims to please its customers.

For just over a quarter-century, the Alabama-based temp agency has provided temporary workers to industrial companies and warehouses in the South, and its dedication to clients shines through its motto: “We built our success helping you succeed.”

But that focus on customer service can be treacherous. When its clients wanted to hire temp workers based on race, sex or age, Automation was happy to oblige, according to dozens of former employees.

Former employees at the Chattanooga, Tennessee, branch office of Automation Personnel Services say they received orders for “country boys,” or white workers.
Former employees at the Chattanooga, Tennessee, branch office of Automation Personnel Services say they received orders for “country boys,” or white workers. Credit: Jeremy Brooks for Reveal

Often, the practice was blatant. A manager at a Georgia manufacturing plant asked Christie Ragland not to send him “any black thugs,” she said. Ragland, a former Automation office manager until early 2015, said her boss told her to give the client what he wanted. And in Memphis, Tennessee, Josie Hernandez said her branch manager would comment, “Don’t hire that damn nigger,” and ordered her to send only Latinos to a flower delivery company.

Other times, Automation staff members used veiled language. At the company’s Chattanooga, Tennessee, branch, a request for white men was known as an order for “country boys,” according to three former employees.

Whether it was a preference for Latino workers or for whites only, the people on the losing end usually were black, according to former employees at branches in six states. Automation would send out black workers – to the employers who would accept them, they said. Sometimes, they were channeled into inferior positions. And if there wasn’t an opening at willing companies that day, black workers would be out of luck.

As tensions mount over racial injustice in America, Reveal found a pattern endemic to the temp industry of racist, sexist and otherwise discriminatory hiring – a practice the top federal regulator acknowledges is growing and difficult to combat. This bias hides in the business transactions of an important, expanding sector of the U.S. economy.

In Baton Rouge, Louisiana, former Automation recruiter Vicki Anselmo said her branch manager used “the N-word like it’s just second language for her.” And employers always got what they wanted, she said, whether it was clean-cut white men or black men without tattoos or skinny women. “They’d be like, ‘Vicki, you know what I’m looking for,’ ” she said.

At an Automation branch in Houston, Jaime Herrington said she was told to have workers come into the office under the ruse that they needed to pick up a map to the job location. In reality, it was to find out the job seeker’s skin color.

“If they were black,” Herrington wrote in a LinkedIn message, “we had to tell them the job was cancelled or already filled by another recruiter.”

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And near Dallas, Vicky Parker said male managers looking for administrative staff often would ask for a woman – specifically a white woman, preferably in her 20s, unmarried and without children. Parker said her boss at Automation readily would consent.

Former employees said they knew Automation had a corporate policy against discrimination – and that it was illegal – but felt they had no choice.

“Whatever the customer wanted, we did,” said Candie McDermott, who oversaw a team of recruiters as office manager of the Huntsville, Alabama, branch until November 2014. “And you didn’t ask questions, you just did it.”

Some worried that if they objected, they’d be fired. A recruiter in Chattanooga, Tennessee, said that’s what happened to her.


Temp agencies like Automation Personnel Services are booming. The industry is at an all-time high of nearly 3 million workers a month, up from just over 1 million in 1990. In terms of jobs, it’s among the fastest-growing sectors in the country, according to a government analysis.

In the thriving industry, businesses are the customers and workers are the commodities. It’s a hallmark of the modern workforce – with a not-so-modern problem with discrimination.

Reveal found similar accounts of systemic discrimination at two dozen other temp agencies across the country, in government and whistleblower lawsuits and in interviews with people who worked at many levels: as recruiters, sales representatives and managers.

Researchers and government officials say hiring discrimination is a particular problem in the industry. Temp agencies face financial pressure to please their customers. Employers sometimes think they can get away with it if a temp agency does the dirty work for them. Temp workers, replaceable on a whim, are especially vulnerable. And with multiple companies intertwined, it’s hard to prove claims of discrimination.

The problem is significant and growing, said Jenny Yang, chairwoman of the Equal Employment Opportunity Commission, charged with enforcing the federal ban on job discrimination.

“Staffing agencies are refusing to place African American employees based on their race,” she said, “and they are terminating employees when they complain about that, as well as limiting assignments that individuals may have.”

Sometimes, it’s obvious. Two hours into an assembly-line shift packaging candy in Atlanta, a few black workers said they were told to leave their positions, according to their lawsuit.

“I’m sorry,” a temp agency representative allegedly told them, “but the Company told me to only hire Mexicans.” The suit settled quickly – and confidentially – last year.

For many temp workers, though, it’s impossible to know why they didn’t get placed, so they rarely file complaints.

Tim Cooper, 30 and now living in Georgia, was desperate when he applied for a temp job at the Chattanooga, Tennessee, branch of Automation Personnel Services. He didn’t get a call back, he says, and he didn’t know why.
Tim Cooper, 30 and now living in Georgia, was desperate when he applied for a temp job at the Chattanooga, Tennessee, branch of Automation Personnel Services. He didn’t get a call back, he says, and he didn’t know why. Credit: Kevin D. Liles for Reveal

Tim Cooper was desperate for a job – any job – when he applied at Automation’s Chattanooga branch a few years ago. He was crushed, he said, that he never got a call back. It came as a complete surprise when Reveal told him that a former Automation recruiter said Cooper was rejected because he’s black.

“It’s very shocking, because you would think those days are over with,” he said. “When they toss them résumés, they toss a whole lot of families out. It just don’t hurt that person, it hurts the people who are connected with them.”

Employers turn to temp labor to boost flexibility – shrinking or expanding their workforce with ease. Workers hope to turn the temporary jobs into permanent ones.

In the industrial sector in which Automation specializes, low-paid temp workers toil on assembly lines, pack consumer products at giant warehouses, build concrete structures or clean equipment. The blue-collar positions can be jobs of last resort or a foot in the door for people with a weak résumé or criminal record.

Stephen Nordness founded Automation Personnel Services in Birmingham, Alabama, in 1990. He’s expanded the private company to 32 branches across the South, from Texas to Florida, with one offshoot in San Diego. The company places some 30,000 temp workers a year and brought in $180 million in revenue in 2014, according to the firm.

After declining repeated requests for an interview, Nordness responded with a statement that said: “We have a very strict, zero tolerance policy against discrimination. It isn’t just illegal, it’s immoral.”

Stephen Nordness founded Automation Personnel Services in Birmingham, Alabama, in 1990. He says his company, which has 32 branches, has a strict policy against discrimination he calls “Steve’s Rule.”
Stephen Nordness founded Automation Personnel Services in Birmingham, Alabama, in 1990. He says his company, which has 32 branches, has a strict policy against discrimination he calls “Steve’s Rule.”Credit:

Nordness calls his policy “Steve’s Rule.” If any employee gets caught discriminating, the entire office is subject to termination.

In a speech he gives to new employees, Nordness claims to have fired a whole branch once. It’s something of a legend at Automation. When asked for details of that mass firing, however – date, location, reason fired – company Vice President Randy Watts said he couldn’t recall.

The everyday reality in the company’s recruiting offices is strikingly different, many former employees said. Some think Nordness must be well intentioned but out of touch, while others see his oft-repeated speech as cynical lip service.

The week after Candie McDermott heard Nordness’ speech at corporate training, she said her branch manager in Huntsville took her aside. Some customers, her boss explained, wanted only workers of a certain gender or race.

“It was that fast,” McDermott said. “And she would say, ‘We can’t put this in the computer, but I’m telling you, they’re only going to take these type of people.’ ”

Automation provided statistics showing that more than half of its overall workforce is black, as much as 57.4 percent in 2015. Aggregate numbers, however, don’t address the crux of the issue described in detail by former employees: that the company is blocking workers – based on race – from specific positions.

Describing workers with code words


Interactive: Can you guess how certain code words were used?

Around the country, other temp agencies have used code words to filter workers by race, age and gender, according to interviews and lawsuits brought by former employees. Simple, creative or plain offensive, the codes show how institutionalized the practice has become. Like at Automation Personnel Services, when race was a factor, black workers usually bore the brunt of the bias.

In New Jersey, blacks were called “number 2s.” In Illinois, “Code 3” meant a Latino worker. A Texas temp agency called whites “blue eyes.” An Ohio agency called them “vanilla cupcakes,” “hockey players” or someone “like you and me.” Another agency owner in Alabama was accused of running her finger along her own white cheek to indicate a preference for whites.

In Seattle, “no Mohammeds” meant not to send anyone of Arab descent. In Florida, construction contractors said, “Don’t send me any monkeys,” meaning blacks. In Texas, “bilingual” often meant a request for Latinos in jobs where speaking more than one language wasn’t necessary.

In Oklahoma, Cara Brown applied at a Tulsa temp agency in 2008 and updated her application in 2010. Gloria Ferrell applied in 2007 and 2011, according to court records. They didn’t get placed, and they didn’t know why – until a customer service representative who kept copies of some job orders sued the company. Notes from one job order read, “ ‘Good ol’ boy,’ as per customer, no B ppl.” Applications allegedly were marked with a dot for black workers, a circle for Hispanic and an X for Indian. Now, Brown, Ferrell and other black job seekers are suing, too.

At Automation, many former employees said they didn’t use codes for race at all. Preferences for whites or Latinos were discussed openly. But in the Chattanooga branch, at least, one supervisor tried to be subtle.

It was a fast-paced den of activity, with Automation employees screening walk-in applicants, making incessant sales calls, fielding last-minute job orders and running out to job sites to make sure the temp workers arrived.

Anastasya Istomin, 30, says she received orders for “country boys” from the sales representative at the temp agency where she worked. That meant the employer wanted white workers, she says.
Anastasya Istomin, 30, says she received orders for “country boys” from the sales representative at the temp agency where she worked. That meant the employer wanted white workers, she says. Credit: Kevin D. Liles for Reveal

Anastasya Istomin worked as an Automation staffing coordinator from 2013 until last May. Her job was to interview applicants and find a good fit when an order came in for temp workers.

But an Automation sales rep, who would get requests from customers and pass them to Istomin, had a particular way of calling in the orders.

“She called me on the phone … and said that they wanted, you know, the usual – country boys,” Istomin recalled.

Istomin said she asked the sales rep, Teresa Clark, what she meant. “So she started saying that they liked white guys over there and not to send anybody black,” Istomin said.

Istomin, her sister Oksana – who also worked as a staffing coordinator – and a third colleague, Keara Parks, said Clark often requested “country boys” for her clients. The three recruiters were outraged, they said.

“How can you discredit this entire population of people and deny them employment based on the color of their skin?” Oksana Istomin said.

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With our investigation into America’s temp industry, Reveal is launching a campaign to explore the many faces of discrimination in the workplace today. And we need your help to do it. Have you experienced discrimination on the job? Tell us about it here.

When Anastasya Istomin assigned a black worker to a job Clark told her was reserved for “country boys,” she said she had to call the man back and tell him the order was canceled.

Reached by phone, Clark – whose LinkedIn profile says, “Keeping our Customers happy is my #1 concern” – said, “I have no idea what you’re talking about,” and hung up.

Automation’s corporation counsel, Kelly Breckenridge, said she spent more than 30 hours investigating Reveal’s findings and did not uncover any evidence of discrimination in Chattanooga or at any of Automation’s branches.

“I’m not an easy person to get around, believe me,” Breckenridge said. “I can say with confidence that (Automation) does not discriminate.” 

Job seekers filtered out

Workers know when they’re being harassed on the job, but it’s much harder to figure out why they didn’t get hired in the first place. The nature of the temp industry makes it more complicated because applicants often don’t know what jobs are available or what qualifications employers requested.

Like a lot of applicants for temp work, when Tim Cooper walked into Automation’s storefront office in Chattanooga and filled out an application, he had some serious counts against him.

Cooper said he had been struggling to pull himself out of trouble in the streets, which included a felony conviction for extortion. He learned welding at a community college, but said he dropped out before getting his certificate. He had two children, living with different mothers, to support.

“I was broken,” said Cooper, now 30. “I lost good women … made my mother very unhappy, my family very unhappy.”

“I was tired of it,” he recalled, smoking a cigarette as mosquitoes pecked at him and roosters crowed outside his aunt’s house in Dayton, Tennessee, last summer. “I felt like, ‘Hey, it’s time to work, it’s time to provide the right way.’ ”

Cooper said he checked back with the Automation office a couple of times but never got an assignment. The rejection, he said, was a breaking point.

“If you’re not strong enough to rely on God, then you just go back to the streets,” he said. “At that time, I wasn’t strong enough.”

Keara Parks says she knows why Cooper didn’t get a job. Parks, a recruiter at the Chattanooga branch at the time, knew him from their hometown and considered him a friend.

Parks also knew about Cooper’s criminal record, but she said it didn’t disqualify him from a basic welding position she had to fill for a construction company in 2013.

So Cooper was included in a handful of qualified résumés Parks says she took to Clark, the sales rep. Before she left, Parks said, the sales rep asked her if any of them were black. Parks said yes, identifying Cooper. She said Clark threw away his résumé.

“It was like a smack in my face,” recalled Parks, who also is black.

Automation’s lawyer disputes Parks’ account. Breckenridge said she found no evidence that it happened. The job order Parks described didn’t exist, and the company normally doesn’t fill welding positions at construction sites, she said.

Parks, though, is adamant that in this case, a qualified worker was eliminated based on his skin color alone.

“Looking back, I think it really bothered me more than I thought,” said Parks, who was fired in 2014.

The Istomin sisters remember how upset Parks was as she told the story just after it happened. Parks was in tears, Oksana Istomin recalled.

Anastasya (left) and Oksana Istomin came to the U.S. when their family fled religious persecution in the Soviet Union. They worked as recruiters for Automation Personnel Services in Chattanooga, Tennessee, a temp agency where they say they were told to discriminate against nonwhite workers.
Anastasya (left) and Oksana Istomin came to the U.S. when their family fled religious persecution in the Soviet Union. They worked as recruiters for Automation Personnel Services in Chattanooga, Tennessee, a temp agency where they say they were told to discriminate against nonwhite workers. Credit: Kevin D. Liles for Reveal

The Istomin sisters came to the United States as young girls when their family fled religious persecution in the Soviet Union. Their parents were religious activists, part of an underground Pentecostal Christian church. One of Oksana’s childhood memories involves Soviet authorities yanking her father out of their home by his hair and imprisoning him.

Their family settled in Cleveland, Tennessee, near Chattanooga, in part because their parents liked that the city was sometimes known as the “buckle of the Bible Belt.” They still view the United States in idealistic terms – for their family and other Russian refugees, it’s the land of freedom and opportunity.

“That’s why … racism and things like that really upset us, because I know what it’s like to be persecuted,” Oksana Istomin said. “Of all countries in the world, this is the country that it shouldn’t be happening in.”

It was 2013 when she decided to force the issue. Istomin got a last-minute order for a worker to package ammunition at Chattanooga Shooting Supplies. The weapons wholesaler, a warehouse across the road from a church, was one of the businesses that wanted “country boys,” according to the Istomin sisters and Parks.

But on that day, the only person willing and ready to go on short notice was not white, Oksana Istomin said.

“He had the experience, he was dressed appropriately and he could go right then and there,” she said. “He fit the perfect criteria for what they were looking for except for one thing – he was Indian.”

Istomin said her branch manager, Tammy Gross, called her into an office. She said Gross told her, “I don’t think it’s a good idea to send him. … They prefer somebody, you know, who’s white.”

Earlier that year, according to company emails provided by a former employee, Gross had written to her staff to say, “Chattanooga Shooting is an integral part of our success as a company in the Chattanooga office. We want to continue to grow with them.”

Istomin said she told Gross that she would send the man anyway unless she received orders in writing. She said she even invoked the company owner’s explicit policy against discrimination: Steve’s Rule.

Gross relented and let her send the man, Istomin said. Within a week, she said, Gross came up with an unrelated excuse to fire her – supposedly for not showing up at a worksite.

“I learned a lot in this industry,” said Istomin, retelling the story in the apartment she shares with her sister, just a short walk away from Automation’s office. “And I know exactly what I’m willing to do and what I’m not willing to do, and it took me working there to realize that.”

Jeff Autry, a manager at Chattanooga Shooting Supplies, said he didn’t request white workers and repeatedly referred all questions to Automation. Gross said in an interview that her branch never discriminated.

“You’re chasing a dead horse,” she said. “It’s not true at all.”

It wasn’t the first time Gross had been accused of such things, however. In 2012, Yolanda Wade, who worked as a staffing coordinator in Chattanooga, filed suit against Automation, accusing the company of creating a racist, sexually offensive workplace. Among many other accusations, Wade said Gross told her to send only white workers to one customer. Wade lost her lawsuit after a judge determined in 2014 that her allegations didn’t rise to the legal standard for a hostile work environment.

With all of this going on behind closed doors, temp workers are left to draw their own conclusions. And from the outside, Automation’s selection process seemed biased to Generia Mitchell.

She got a temp job at a big automotive plant in Chattanooga, she said. But when she sent a bunch of people she knew to apply at Automation, too, she noticed something strange. The black applicants didn’t get placed, she said. A white woman she referred, she said, got a job right away.

“I was just shocked,” said Mitchell, who said she is biracial. “I didn’t complain because I didn’t want it to affect me.”

Discrimination in the name of customer service

Temp agencies are service providers. They handle payroll, workers’ compensation claims and dismissals when workers no longer are wanted or needed.

But some employers look to temp agencies as a convenient way to discriminate as well, said Marc Bendick, a Washington economist who studies discrimination and consults for plaintiff’s attorneys, some large employers and the government.

“The fact of the matter is that a lot of the regular employers basically want to contract out their discrimination,” he said. “They know the workforce they want, but they don’t themselves want to violate workplace discrimination laws. They want clean hands.”

Bendick uses undercover testing to ferret out discrimination. A team of researchers picks out a pair of testers, often college students, who look and sound alike except that one is black and one is white. They’re given virtually identical résumés and trained to say the same things and dress similarly. Then they apply for the same jobs.

A study Bendick conducted in the 1990s found discrimination against black job applicants two-thirds of the time at temp agencies. That was nearly twice as high as when the testers applied directly with employers.

Temp agencies, Bendick said, are driven by competition to go above and beyond to please their customers. Some filter workers by race or gender without an explicit request, he said, after looking at a client’s workforce and assuming managers will want more of the same.

Stephen Dwyer is general counsel for the industry’s trade group, the American Staffing Association. He said discrimination is not more common at temp agencies and is bad for business because it narrows the pool of qualified candidates.

“I think that it’s very much a small minority of the industry that engages in this practice,” he said. “Certainly, the majority of our members act, or strive to act at least, in a law-abiding manner.”

At Automation, the pressure to bring in new business and hit sales goals was brutal, according to Sandra Swearingen, who was a branch manager in Decatur, Alabama, in 2012 and 2013. Swearingen said she always turned down requests to discriminate and once lost a customer over it. But, she said, an ambitious manager with less integrity might not make the same call.

“You have plenty of opportunity to make the wrong decisions,” she said.

Today’s temp agency discrimination harks back to the use of labor brokers in the first half of the 20th century, when segregation of jobs was explicit and accepted, said George Gonos, professor of labor studies at Florida International University.

“That’s been one of the functions of using an outside employment agency … going back to before the Civil Rights Act,” he said.

In 1963, the year before Congress passed a federal ban on job discrimination, the American Jewish Congress conducted a survey of hundreds of employment agencies – including some of the big temp agencies of the time. Surveyors asked whether they would provide a “white Protestant stenographer.”

Some balked at filtering by religion but were happy to find whites only. More than 90 percent of the agencies agreed to at least part of the request.

Discrimination, then and now, is driven by stereotypes and prejudice, experts and former temp agency employees say. Black workers often face the worst preconceptions.

Josie Hernandez, the former Automation recruiter in Memphis, said her boss would use racial slurs to comment that blacks didn’t want to work, calling them lazy. Hernandez said she quit in disgust after three months.

Reynalda Cruz, who was a temp worker in New Jersey for many years before joining a workers advocacy group, said temp agencies would send out Latinos instead of black workers “because they say Mexicans are more obedient,” she said in Spanish.

When it comes to gender, stereotypes are so ingrained that some temp agencies seem unaware that segregation by sex is outlawed.

A Houston temp agency, for example, announced last year on its Facebook page, “We are hiring 4 guys,” for one job and “Se necesitan 4 mujeres” – or “We need 4 women” – for a different warehouse.

Reynalda Cruz removes a New Jersey temp agency window sign that reads, “Trabajo Para Mujeres,” or “Work for Women.” Cruz was a temp worker for many years before joining New Labor, a workers advocacy group.
Reynalda Cruz removes a New Jersey temp agency window sign that reads, “Trabajo Para Mujeres,” or “Work for Women.” Cruz was a temp worker for many years before joining New Labor, a workers advocacy group.Credit: Zhengchen Luo for Reveal

In New Jersey, Cruz tore down a temp agency window sign in September that said, “Trabajo Para Mujeres,” or “Work for Women.” The advocacy group she works with, called New Labor, and the Center for Women and Work at Rutgers University put out a report saying men’s temp jobs – lifting boxes and operating forklifts – typically pay more than women’s jobs, like assembly-line work.

Code words for gender, which pop up at some Automation branches and other temp agencies around the country, reflect the bias. A “heavy” or “heavy lifter” is a man, while a “light” is a woman. “Small hands” denotes a woman’s job.

Tammy Gross – the Chattanooga branch manager whom Oksana Istomin accused of firing her for opposing discrimination – wrote her staff an email in 2013 requesting “4 people (small hands) to pack boxes and fold leaflets,” according to an email provided by a former employee. The recruiters submitted four women’s names. Asked about the email, Gross said “small hands” means “you don’t have to be a heavy lifter … it has nothing to do with gender.”

Some temp agencies will tell applicants directly that they don’t qualify because of their sex.

In a lawsuit filed in October, the Equal Employment Opportunity Commission accused a Mississippi recruiting office of turning away Jonika Walton from a trash collector position because it was a “male only” job. The temp agency rejected at least 33 other women, while hiring up to 130 men, according to the suit.

Then there’s Jennifer O’Neal, who saw jobs advertised on a highway billboard outside of Chicago. But when she called the number to apply for a spot at a concrete company, a temp agency representative told her that it was a man’s job, according to an interview she gave to employment commission investigators.

O’Neal had experience pouring concrete and had been doing construction work since she was 16. Still, according to O’Neal, the representative said, “Sorry, we can’t help you.” O’Neal’s brother and two male friends did get hired. The temp agency settled for $60,000, and the concrete company agreed to pay about $28,000 to resolve the employment commission lawsuit in 2013.

The commission has filed at least 10 lawsuits in the past decade accusing temp agencies of systematically filtering out workers based on sex, race or age.

In Memphis, Tennessee, the commission accused three temp agencies in separate cases of excluding black workers while signing up Latinos.

In one, LaSabra Epps found that when she arrived at a temp agency office, Latinos were in a different room filling out applications. An agency representative told Epps and other black applicants that the agency wasn’t hiring. Epps left and filed a complaint with the employment commission. That was in 2006. The case settled for $580,000 in 2014.

The most recent one, filed in 2014, said Nakia Sanford went through a Memphis temp agency to get a position at a FedEx distribution center across the Mississippi state line. Temps were supposed to be picked on a first-come, first-served basis, so she showed up early in the morning to sign in. But the temp agency supervisor, according to the suit, prefilled the sign-in list with Latino names and sent out Latino workers who arrived after Sanford, who is black. That lawsuit is ongoing. 

Employment commission’s secrecy

There are no federal criminal penalties for participating in employment discrimination. And beyond the lawsuits, figuring out exactly what the commission is doing about the problem is hard to assess. By law, every complaint the commission receives, and its investigation, is secret unless it goes to court. Less than 1 percent of all complaints it receives make it that far, commission statistics show.

In fact, commission officials can face criminal charges for disclosing information about even confirmed cases of discrimination. In contrast, other federal labor agencies routinely release information about their investigations and findings.

The confidentiality, commission officials said, can encourage companies to resolve problems quicker. But the upshot for a company is that as long as it settles before litigation, it’s as if nothing happened.

The public never would have known that Sedona Staffing of San Diego paid $920,000 to settle allegations that it systematically failed to place workers based on race, sex, age and disability. But in that case, the employment commission negotiated the ability to put out a news release in 2013 as part of the settlement.

It was supposed to be a warning to the industry, said Anna Park, regional attorney for the commission’s Los Angeles district office, because “we only catch the tip of the iceberg.”

The commission never has sued Automation Personnel Services. The number of complaints filed against the company and whether the commission found problems is all confidential.

But federal officials have known of problems at Automation since at least 2011, when a former recruiter named Daniel Brown filed a complaint with the commission’s Atlanta office. It shows up in a lawsuit he brought against the company.

Brown, who is white, notified the commission in 2011 that his manager in Automation’s Morrow, Georgia, office instructed him to send only young white men to a concrete manufacturer.

Later, a black worker complained in writing that he was subjected to racist taunts at an airline warehouse where he was placed by Automation. Brown’s manager threw the complaint in the trash and told him only whites should be sent there, according to Brown’s complaint.

Instead of taking up the case, the commission granted Brown his own right to sue. Automation denied discrimination, claimed Brown was fired for inappropriate office behavior and settled in 2013 under confidential terms.

Other than the federal commission’s efforts, no national movement exists to combat hiring discrimination in the temp industry. But activists with the Chicago Workers’ Collaborative have been waging a campaign in Illinois for a few years, arguing that temp agencies there are shutting out black workers in order to exploit Latino immigrant labor.

They have pushed state legislation to make temp agencies record the race and gender of all job applicants – to create a paper trail that would show where discrimination is occurring. The bill, however, died last May amid opposition from the temp industry, which argued that it was burdensome.

The industry has opposed reporting data for decades. In the 1960s, the industry’s trade group pushed to be exempted from regulations that require large employers to share the demographics of their workers with the government. To this day, the Equal Employment Opportunity Commission doesn’t require information on the race and gender of temporary workers.

Some companies, like Automation, report their temp workforce demographics anyway. But those aggregate numbers don’t show discriminatory filtering for certain clients – or the difference between applicants and hires.

“It is crucial … that we know the names of the companies to whom they have been referred,” said Kate Boehringer, an employment commission attorney speaking at a commission meeting in 2011. “That is the only effective means of us being able to effectively detect patterns and discriminatory referrals.”

Yang, the commission’s chairwoman, said it recently approved a plan to study whether to require temp agencies to provide the demographics of their applicants and referrals. “Then we could more easily identify where there may be problems,” she said. But whether the commission actually conducts that study depends on its resources, a spokeswoman said.

Dwyer of the American Staffing Association said more reporting requirements would be impractical for temp agencies handling so many workers at different worksites. 

‘We need some more Mexicans’

The value of data is powerfully illustrated in Huntsville, Alabama. There, one of Automation’s clients is a huge South Korean company that makes everything from cellphones to refrigerators: LG Electronics Inc.

It’s such a big client for Automation that the company assigns a staffing coordinator to work on-site.

LG’s operation in Huntsville is one of the company’s largest in the United States, shipping out parts for consumer electronics and appliances that need servicing. A series of giant, flat buildings occupy an industrial park next to the Huntsville International Airport.

Through Automation, LG wanted temp workers for its warehouse – but not just any workers.

“They had to be Hispanic,” said Candie McDermott, the former Automation office manager.

Four other former Automation employees also said LG specifically wanted Latinos.

Requests were coming directly from an LG warehouse manager, said Sandra Keith, who occasionally filled in for the on-site coordinator during her time as an Automation recruiter.

“He would just flat out say, ‘Hey, we need some more Hispanics,’ or ‘Hey, we need some more Mexicans over here, you guys got any?’ ” Keith said.

Qualified black and white job seekers didn’t get jobs there as a result, said Keith, who left in 2013 and now works as a medical assistant.

Both Keith and McDermott said the branch manager, Allison Bevelheimer, brushed off their concerns.

Bevelheimer didn’t respond to phone calls. Automation released a statement from Bevelheimer and Stephen Nordness, the company president, denying any discrimination and praising the two firms’ 14-year partnership.

John Taylor, LG’s vice president for public affairs and communications, said the electronics giant investigated in response to Reveal’s inquiry and found no evidence of a problem.

“It’s just not true,” he said. “I’m not sure what a few former disgruntled employees may say, but the fact is that this is not in accordance with our policy, and if we did find that this was going on, it would be dealt with swiftly and strongly.”

Taylor did say the warehouse workforce of about 100 temp workers is predominantly Latino. Automation pegged it at 75 percent Latino and 18 percent black. Both companies pointed to a large number of Latinos in the area.

“That particular customer you’re referring to is in an area that’s demographically more Hispanics than any other,” said Automation’s attorney, Kelly Breckenridge.

There are specific neighborhoods with a high concentration of Latinos in Huntsville. But census figures from 2010 show that less than 5 percent of the area’s overall population was Latino.

That indicates a problem, according to Cedric Herring, who studies workplace diversity as a professor of sociology and public policy at the University of Maryland, Baltimore County. It is “extremely unlikely that you could have those kinds of numbers without there being some pattern of discrimination,” he said.

The LG Electronics Inc. facility in Huntsville, Alabama, gets temp workers from Automation Personnel Services. Former Automation employees say LG wanted Latino workers specifically.
The LG Electronics Inc. facility in Huntsville, Alabama, gets temp workers from Automation Personnel Services. Former Automation employees say LG wanted Latino workers specifically. Credit: Will Evans/Reveal

The disparities can sow mistrust and resentment among workers.

When Elizabeth Shaw started working as a temp for LG years ago, she said most of the workers were black or white – “Americans,” as she called them. Then came “the illegals,” she said.

“You’d look up and see people getting laid off. Then they’d bring in 30 Hispanics,” she said. “They found out they could get more work and longer hours out of them and pay them less money.”

Shaw said she lost her job in 2010 but went back to Automation more recently to try again. She didn’t get hired, she said. Shaw might not have any evidence of discrimination but says she felt it.

“You see the Hispanics going in, and they were getting places to work,” she said.

Shaw said she ended up going back to a job at a fast food restaurant.

There was tension inside Automation’s Huntsville office, too.

Sandra Keith was upset by the discriminatory hiring and said her manager was in on it. But she didn’t know what to think of Nordness, the company president. He would insist that he didn’t tolerate discrimination, and he seemed serious, she said. But what if he wasn’t?

There was a time a few years ago when Nordness visited her branch, Keith recalled. The workday over, staff gathered in the lobby where job seekers fill out applications. Nordness told them that he would fire the whole branch if he discovered any discrimination.

As Nordness spoke, Keith found herself wondering, “Is he just saying this to cover his butt, or does he not understand what’s going on?”

“It just made everyone feel weird,” she said. “No one said anything. We just sat there with a blank stare.”

The next day, Keith said, a supervisor assured the rattled staff that no one was going to come in and fire everybody. And no one ever did.

This story was edited by Fernando Diaz and Amy Pyle and copy edited by Sheela Kamath and Nikki Frick.

Will Evans can be reached at Follow him on Twitter: @willCIR

Illustration by Jamie Hibdon/Illustrated Press

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Will Evans was a senior reporter and producer for Reveal, covering labor and tech. His reporting prompted government investigations, legislation, reforms and prosecutions. A series on working conditions at Amazon warehouses was a finalist for a Pulitzer Prize and won a Gerald Loeb Award. His work has also won multiple Investigative Reporters and Editors Awards, including for a series on safety problems at Tesla. Other investigations exposed secret spying at Uber, illegal discrimination in the temp industry and rampant fraud in California's drug rehab system for the poor. Prior to joining The Center for Investigative Reporting in 2005, Evans was a reporter at The Sacramento Bee.