(Reuters) - A California agency's lawsuit accusing Cisco Systems Inc of tolerating Indian workers' harassment of an Indian colleague who comes from a lower caste could trigger a reckoning in the tech industry, which disproportionately hires work-visa holders from India, experts said.

California's Department of Fair Employment and Housing (DFEH) sued Cisco last month saying the company ignored the engineer's claims that he was mistreated by two supervisors because he is a member of the Dalit caste, formerly known as "untouchables." The agency accused Cisco of discrimination based on the engineer's ethnicity, race, religion and ancestry in violation of state and federal laws.

But caste does not match up directly with any of those categories, and that gap in the law has made it difficult for Dalits to hold companies accountable for pervasive discrimination by their Indian peers, particularly in the tech industry, said Thenmozhi Soundararajan, a Dalit rights activist and executive director of advocacy group Equality Labs.

DFEH in the June 30 complaint said the engineer, identified as John Doe, worked at Cisco's San Jose headquarters on a team with other Indian nationals who all came from higher castes. Doe's supervisors gave him less desirable assignments and fewer opportunities for promotions and raises, the agency claimed.

San Jose-based Cisco in a statement responding to the lawsuit, which was filed in San Francisco federal court, said it had followed its procedures for investigating the engineer's complaints and will vigorously defend itself against the claims.

"We were fully in compliance with all laws as well as our own policies," the company said.

About 70% of foreign nationals in the United States with H-1B visas for specialized professions are from India, according to data from U.S. Citizenship and Immigration Services, and they disproportionately work for tech companies. More than 90% of Indian visa holders are from higher castes, according to the complaint against Cisco.

Soundararajan said that disparity reflects bias against Dalits at the elite Indian colleges that feed the H-1B program. And that discrimination follows Dalits into the U.S. workplace, she said.

The Hindu caste system groups people into five main castes, with Dalits at the bottom. In a 2018 survey of Dalits in the U.S. conducted by Equality Labs, two-thirds of respondents said they had been treated unfairly at work because of their caste.

Addressing caste in U.S. courts may be tricky because it is linked inextricably with Hinduism, and judges may be concerned about the First Amendment implications of delving into Hindus' religious beliefs, said Kevin Brown, a professor at Indiana University's Maurer School of Law.

"What (a judge) would effectively have to do is determine whether Hinduism as a religion is itself discriminatory," he said.

It is unlikely that a caste-based discrimination claim would be recognized under the federal law prohibiting workplace discrimination, Title VII of the Civil Rights Act of 1964, Brown and others said, because caste does not line up with any of the categories protected by the law, such as race and national origin.

But California's Fair Employment and Housing Act (FEHA) is interpreted more broadly and, unlike Title VII and anti-discrimination laws in most other states, prohibits bias based on ancestry.

That could be the key to DFEH winning its case against Cisco and provide a legal blueprint for other Dalits, according to Brown. Hindus generally believe that Dalits are descended from native Indians who were conquered thousands of years ago by Central Asian people that came to populate the higher castes.

The case is Department of Fair Employment and Housing v. Cisco Systems Inc, U.S. District Court for the Northern District of California, No. 5:20-cv-04374.

For the FEHA: Jeanette Hawn

For Cisco: Not available