As part of the confidential agreement Houston-based Shipley admits no wrongdoing and the workers will drop their claims. U.S. District Judge Nancy Atlas dismissed the case this week after the settlement was reached.
In the suit, the workers said that Hispanic and white supervisors threatened them with deportation and referred to them as "wetbacks." The workers also alleged that supervisors forced them to work off the clock, provided few breaks and demanded money in exchange for vacations or permission to see a doctor when injured on the job. The supervisors' actions often went unchecked because Shipley executives did not speak Spanish and worked mostly in the main office, court papers said.
Family-owned Shipley denied the allegations in court documents.
Other Shipley employees were originally part of the suit but left the case after striking separate settlements with the doughnut maker.
Shipley Do-Nuts is a company with 200 locations in the Southeast.