CHICAGO — A month before what could have been an embarrassing trial, the city has agreed to a $5.8 million settlement in a lawsuit alleging Black employees at the Chicago Department of Water Management were subjected to years of racist and sexist slurs, including some by politically connected top-level supervisors.

The parties announced they had reached an agreement during a status hearing Monday before U.S. District Judge Matthew Kennelly, who vacated the June 5 trial date.

Plaintiffs’ attorney Victor Henderson later confirmed the $5.8 million settlement figure, which has not been finalized and will need to be approved by the City Council.

A lawyer for the city told the judge the parties were confident the settlement would be ready for consideration at the City Council meeting in mid-June.

The settlement comes less than a month after Kennelly ruled there was sufficient evidence for a reasonable jury to find “that the city had a custom or policy of condoning racial harassment and discrimination at (the Water Department) as well as inaction in the face of a risk of potential constitutional violations.”

The trial was expected to feature a number of current or former high-ranking city officials as witnesses and will shine a harsh light on allegations of unseemly treatment.

Among the allegations by the plaintiffs: Repeated use of the N-word, references to Black employees by supervisors as “you people,” and, in one instance, a foreman who allegedly mocked an African American employee’s skin tone and instructed the employee to stand next to a door “to see if it was painted black.”

In a written statement Monday, Henderson said the entrenched racism at the department lasted for decades and affected countless Black employees, which “raises the question why the city’s uppermost leaders failed to act.”

“The sad and most obvious answer is that they did not care,” Henderson said. “It is plain to anyone who looked that the racism cascaded from the very top of the organization like water travels down a hill.”

A spokeswoman for the city’s Law Department declined to comment Monday.

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