Lululemon accused of an ugly problem that's slowly coming to light

In a 2004 interview with Lululemon  (LULU) - Get Free Report founder and former CEO Dennis J. "Chip" Wilson, the former head revealed that the name of his popular athletic brand has an incredibly problematic origin, noting that he came up with it after his observation of Japanese people pronouncing names with the English letter 'L' in it. 

"L is not in their vocabulary. It’s a tough pronunciation for them. So I thought, next time I have a company, I’ll make a name with three Ls and see if I can get three times the money," Wilson told National Post Business Magazine. "It’s kind of exotic for them. I was playing with Ls and I came up with Lululemon. It’s funny to watch them try to say it.”

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Though the founder has distanced himself significantly from the successful yoga and athlesiure label, inklings of a troubled company culture are surfacing for the Canadian brand.

A recent report by Sheena Butler-Young in the Business of Fashion contains accounts from 14 current and former Lululemon employees across the company, alleging "a company culture that is unwelcoming of Black people," and where "leaders regularly use stereotypes to define and ostracize minority employees, who face barriers to career advancement that don’t seem to apply to white colleagues." 

Lululemon was one of many companies who promised to actively improving its internal diversity and creating more equity within its company during the summer of 2020. 

Canadian sportswear clothing band, Lululemon logo and store seen in Hong Kong.

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In November 2020, it formed a new department named "Inclusion Diversity, Equity and Action,” or IDEA, which was tasked with increasing the diversity of of staff, expanding DEI training and development, and creating an ongoing dialogue between underrepresented employees and its CEO, Calvin McDonald. 

Though this seemed like a genuine effort from the outside, employees told BoF said that it was meant to protect the company's image first and ensure minority employee's wellbeing and careers second.

Miya Dotson, a former IDEA manager, told BoF that her supervisor told her that “IDEA is a wave in the company and … we just need to ride the wave until there is something else," before she joined the team. 

A shopper carries a bag from Lululemon at the Toronto Premium Outlets shopping mall

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Kenosha Armstrong, a store operations lead, told the publication that her experience working for the yoga pants giant felt like "smoke and mirrors."

“[Lululemon] makes you feel like it’s going to be supportive and you’re not going to be a part of the history of micro aggressive behaviour and it just isn’t the case,” said Armstrong.

The highlight of the report revolves around Lululemon's-now closed location in Hyde Park in Chicago's historically Black South Side, which was led by its then-general manager Michael "Muffy" Collins. 

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He and six of the store's 16 former employees have filed complaints with the U.S. Equal Employment Opportunity Commission, alleging racial discrimination within the company. 

Collins and other staff members that worked alongside him told BoF of several instances where the company made it known that his efforts of running the store were unwelcome.

According to Collins, he was told on numerous occasions by Lululemon's regional managers and executives based in their corporate office in Vancouver to to hire white and Asian sales associates, "to reflect the racial makeup of the nearby University of Chicago."

Additionally, other accounts given to the EEOC noted that regional managers regularly referred to Black staff members as "you people," denied Black employees job opportunities in favor of less qualified white counterparts, and that the company referred black employees at other Chicago-area Lululemon stores that they would be a "better fit at the Hyde Park location."

Another former employee, Adetimisola “Timi” Ogundipe, told BoF that he believes that the reason he was let go from his position as a talent manager in August 2022 was because of a racial discrimination claim he filed with HR. 

As a Black employee, he believes that he was the target of scrutiny by managers for not "code-switching," or adjusting his vocabulary, syntax and grammar to fit "professional" white, corporate environments in emails and other correspondence.

The Lululemon logo is seen on a water bottle in window display at a Lululemon store

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In June 2022, Ogundipe was placed on a performance improvement plan by the company, who expressed that communication between him and other employees lacked "clarity, consistency, professionalism and timeliness;" noting several emails to his colleagues that included phrases like "my bad" and "nah," even though other colleagues responded in a similar manner.

Nonetheless, he submitted a racial discrimination complaint to Lululemon's people and culture team, who hired a third party to investigate, who found nothing to support his claims after a six-week investigation. He would be fired the following week, as Lululemon cited that his "belief that Lululemon has a discriminatory culture" affected his ability promote the company as "a positive place to work."

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In a statement, Lululemon said it “has made considerable progress since launching IDEA, and we are proud of the goals we have achieved, which include maintaining a continuous two-way dialogue with our people … We remain steadfast in our focus to achieve our IDEA commitments and are confident in the leadership of the IDEA team.”

TheStreet has reached out to Lululemon for comment.

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