Electroimpact President Peter Zieve. (Dan Bates / Herald file)

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MUKILTEO — Electroimpact has made a reputation as a leading aerospace supplier that attracted topshelf engineers. Last year, it gained a reputation for a workplace culture where workers traded hateful jokes about Muslims via company-wide emails, single employees were pressured to marry, and job applicants who appeared to be Muslim were passed over.

News reports in The Daily Herald and other publications prompted a months-long investigation by the state Attorney General’s Office, which says that the private company violated state law by discriminating on the basis of religion and marital status.

The state announced Friday it reached a settlement with Electroimpact. The company has agreed to non-discriminatory hiring policies, encourage more job applications from people of color and pay $485,000, among other stipulations in a consent decree signed by the state and Electroimpact.

The attorney general said the court-monitored decree will be in place at Electroimpact for more than three years.

Some of the changes were made nearly a year ago, when news reports revealed Electroimpact’s workplace culture and the efforts of its founder and president, Peter Zieve, to block construction of a proposed mosque in Mukilteo, where the company is based.

“The workplace culture has changed,” said Ben Hempstead, a senior engineer who often acts as Electroimpact’s public face.

Zieve could not be reached for comment Friday.

The attorney general’s office says the investigation by its civil rights unit shows that the company engaged in unfair or deceptive practices by describing itself as an equal opportunity employer in advertising.

“The conduct outlined in our complaint is outrageous,” state Attorney General Bob Ferguson said in a news release Friday. “Discriminating against workers and retaliating against anyone who questions it is illegal.”

“This is old news,” Hempstead said. “There’s no new material” in the state’s complaint against the company.

Zieve did offer a bonus to married employees, but it only happened once, he said. “We still do give (financial) gifts based on the number of children people have. We want to support families, and there’s nothing wrong with that.”

The state’s complaint only cites one example of Zieve offering a marriage bonus. However, it implies that the practice was ongoing.

While the settlement imposes several conditions on the company, it also includes a statement that “Electroimpact expressly denies that it engaged in any unlawful, actionable, or prohibited conduct.”

Zieve’s personal beliefs came into the spotlight in 2016, when he waged a secretive campaign to block construction of a proposed mosque in Mukilteo. The Daily Herald tied the campaign back to Electroimpact’s owner.

He dropped his opposition to the house of worship, and apologized in person in May 2016 to Mukilteo-area Muslims.

In an email to the Herald last year, Zieve wrote that his actions “have offended and hurt my neighbors and their families, for that was not my intent. I sincerely apologize for those actions, in particular to my Muslim neighbors.”

Most of the needed permits have been issued for the mosque, and construction should start this year, said Mohammed Riaz Khan, president of the group backing the proposed Islamic Center of Mukilteo.

The resulting controversy prompted changes at Electroimpact, Hempstead said. “The jokes email list is gone,” and the company changed its hiring practice last year.

Zieve is not involved with hiring. Instead, the company uses a transparent tracking system that focuses on an applicant’s qualifications and experience, he said.

About a dozen people have been hired since the new system went into effect in December. Prior to that, the company had stopped hiring in April 2016 while revising its practices, he said.

Recently, the company made offers to five applicants, including two women, Hempstead said.

Electroimpact pays online job sites to make sure its openings are seen by people who are not white and are looking for work, he said. “That has really paid off” in the applications coming in.

The company continues to have high standards for applicants, he said.

Considering that the company allegedly weeded out certain non-white candidates before, its hiring practices are more merit-based today than before.

Under the conditions of the decree:

• Zieve will no longer participate in evaluating candidates for non-management positions.

• Electroimpact will no longer base compensation decisions on marital status.

• Someone other than Zieve will be designated to accept employee complaints, and the employee handbook will be changed to reflect that Electroimpact prohibits harassment.

• Electroimpact will make reasonable efforts to increase hiring people of color, including advertising every internship and full-time employment opportunity to minority engineering organizations, hosting two events with minority student associations at Electroimpact property on a semi-annual basis, and conducting at least two recruitment events with minority engineering organizations on a semi-annual basis.

• Electroimpact will provide semi-annual reports to the state including a summary of all complaints made against Electroimpact or its agents about discrimination or harassment based on religion, national origin or marital status.

The aerospace firm is one of the city’s biggest employers, and Zieve has numbered among the community’s most celebrated business leaders. Electroimpact is a prominent maker of automated machines for jetliner assembly and counts the Boeing Co. as a major customer. Electroimpact also does business with Airbus and other airplane makers.

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