Bowlero BOWL faces dozens of EEOC discrimination claims

Bowlero, the buzzy bowling company that was one of the few successful stocks to emerge from the SPAC boom, is the subject of a sprawling federal investigation into age discrimination and retaliation that authorities now want to settle for $60 million, CNBC has learned.

Negotiations over the settlement, proposed by the U.S. Equal Employment Opportunity Commission in early January, failed in April and the case is being referred to the EEOC’s general counsel “for potential enforcement action,” a letter sent by the EEOC shows. 

If the EEOC decides to sue and if it prevails in court, the company could face even steeper fines, experts said. 

Before the agency can sue Bowlero in federal court, the EEOC’s commissioners need to vote on the matter. 

The $60 million resolution proposal has not yet been publicly disclosed and was revealed to CNBC by attorney Daniel Dowe, who represents more than 70 former employees with claims against Bowlero. The EEOC briefed him about the settlement proposal so he could obtain authorization from his clients before agreeing to settle, he said.  

The EEOC’s probe into Bowlero, the world’s largest owner and operator of bowling centers, is wide-ranging and has been ongoing since 2016, company filings with the Securities and Exchange Commission show. It involves at least 73 former employees who claim they were fired based on their age, or out of retaliation, according to the filings. 

The company disclosed in the filings that EEOC’s investigation resulted in a determination of reasonable cause that Bowlero has been engaging in a “pattern or practice” — a term that indicates systemic issues — of age discrimination since at least 2013, which Bowlero denies.

The agency typically finds reasonable cause in only a small fraction of cases each year, EEOC data shows. 

Experts say the settlement proposal is particularly large for the agency, especially when compared with the monetary benefits the EEOC secured for victims of age discrimination in previous years.

The company has repeatedly denied allegations of discrimination and other wrongdoing.

If Bowlero — which went public in late 2021 through a special purpose acquisition company, or SPAC — ends up settling the case or losing in court, it won’t be a major blow to the company’s balance sheet or operations now, experts said. But the indirect costs could plague Bowlero well into the future, they said.

Bowlero CEO Thomas Shannon is accused of hosting “obvious beauty contests” with prospective hires over brief video calls to evaluate a candidate’s appearance as part of the hiring process, according to a complaint filed by a former employee and a sworn affidavit filed by another staffer to the EEOC.

At times, Shannon even screened candidates for lower-level, customer-facing roles at the company, which had nearly 10,000 employees across more than 300 bowling centers as of July, documents filed by former employees say….