Brandywine Auto Parts Inc., a family-owned company that employs more than 350 people in 18 stores throughout the Washington area, has agreed to pay $365,000 to settle a federal racial discrimination lawsuit filed by a black former employee who alleged that he was wrongfully fired and that he and Hispanic workers frequently endured racial slurs and other discriminatory acts from a store manager.

The Brandywine-based company agreed to pay $290,000 to former employee William Pegram, 42, of Oxon Hill, and $75,000 in fees to Pegram's attorneys. The company did not admit any wrongdoing or violations of law in the settlement.

In addition to the payments to Pegram and his attorneys, the company agreed to pay for diversity and sensitivity training and to make it mandatory for all its employees. The company also agreed to attempt to increase its number of minority sales workers and supervisors.

Pegram was represented by the Washington Lawyers' Committee for Civil Rights and lawyers from the Washington firm of Miller & Chevalier.

"The treatment that Mr. Pegram endured is totally intolerable in our society," said Warren Kaplan, of the Washington Lawyers' Committee.

"We're hopeful that with this agreement, the company will move ahead constructively and that this kind of conduct will not occur again," said John D. Bates, of Miller & Chevalier.

Efforts to reach Pegram, who now works for a car rental company, were unsuccessful.

Judy McFadden, spokeswoman for the auto parts company, said, "We are pleased to resolve this matter and remain committed to our policy of nondiscrimination and equal opportunity."

McFadden declined to comment on the specific allegations in Pegram's lawsuit, which was filed in U.S. District Court in Greenbelt in November.

According to the 22-page lawsuit, Pegram worked for the company from August 1987 until he was fired in January 1997.

Pegram started out as a truck driver and was promoted to the position of counter salesman, the lawsuit said. Pegram was the only African American the company has ever employed as a counter salesman, according to the lawsuit.

On numerous occasions, the lawsuit alleged, one of Pegram's supervisors, Stephen Meinhardt, used racial epithets that created a hostile and abusive work environment.

When Pegram protested that the racial slurs were offensive to him, Meinhardt responded that he instead would call him "tigger," according to the lawsuit.

Meinhardt also allegedly used racial slurs when referring to other African American employees and once said about the Martin Luther King Jr. holiday, "I wish they'd never killed" him.

Meinhardt remains a company supervisor. In a brief interview, Meinhardt, whose father co-founded the business, said, "I can't recall any discrimination or harassment."

However, in a Feb. 11 deposition, Meinhardt admitted that he had used a racial slur but that he now understood that was wrong.

The lawsuit also alleged that Pegram performed duties that white counter salesmen were not asked to perform, such as maintaining an inventory of parts and loading parts onto trucks. The suit said Pegram was paid far less than white employees who did less work. The lawsuit cited one white employee who made $30,000 at the time that employee left the company. Pegram, by contrast, was paid "far less," the lawsuit said.

Meinhardt also made slurs about Hispanic workers and discriminated against them, the lawsuit alleged. Meinhardt allegedly said he hired Mexicans "because they work so cheap" and refused to let Hispanic workers use the bathroom other than to wash their hands. Hispanic workers had to go into nearby woods to relieve themselves or go to a bathroom at the auto parts installation shop about 75 yards from the auto parts store, the lawsuit said.