The work environment at Books For Less was one of severe racial harassment that included references to its warehouse in Blawnox as the "plantation," and frequent use of the "N-word," according to an EEOC settlement reached yesterday in U.S. District Court in New York.

The wholesale bookseller, which is based in New York and runs a warehouse in Blawnox, was sued by the U.S. Equal Employment Opportunity Commission on behalf of 21 former employees who claimed superiors often referred to African-American workers as "stupid and lazy," and paid black employees less than other workers.

Books For Less LLC has been ordered to pay $180,000 to the 21 former employees for racial and sexual harassment and retaliation. All of its current employees and managers will undergo annual training in harassment and discrimination, and the company must donate $10,000 worth of books to the August Wilson Center for African Culture after-school program in Pittsburgh.

"The retaliation was very severe," said Sunu P. Chandy, an EEOC senior trial attorney in New York. "It involved discrimination and writeups without reason. But it got even worse. [Managers] were even calling the employees' homes to intimidate their children."

Michael Shmuely, owner of Books For Less, said the complaint against his company contained a lot of falsehoods. He said there were problems at the Blawnox warehouse, though, which included theft.

"The only reason I was forced into settling was the litigation costs were too high," Mr. Shmuely said.

Mr. Shmuely is named in the hostile workplace complaint as one of the harassers. He is required to complete eight hours of one-on-one training and counseling on discrimination within 30 days.

The EEOC suit was filed in August 2006. The 21 claimants include black men and women, along with whites who said they became company targets for associating too closely with African-American employees or supporting their claims of discrimination while working at Books For Less.

Female employees involved in the complaint said they experienced sexual harassment, including graphic language and gender-based slurs.

"What this case does is educate employers that this is not acceptable and against the law," said Ms. Chandy. "It also should serve to encourage any employee who is in this position to contact the EEOC if [he or she is] facing this type of discrimination and retaliation."