Target has agreed to settle a lawsuit that said its hiring process, which automatically rejected people with criminal backgrounds, disproportionately kept blacks and Hispanics from getting entry-level jobs at its stores.
As part of the settlement, Target will pay more than $3.7 million and will hire outside experts to review how it deals with applicants who have criminal backgrounds. According to the lawsuit, blacks and Hispanics were harmed by the hiring system because they are arrested and incarcerated at higher rates than whites. The suit cited "systemic discrimination in the criminal justice system."
More than 41,000 black and Hispanic applicants were denied jobs based on their criminal history between 2008 and 2016, according to the court documents.
A judge still needs to approve the settlement.
Target said Thursday that it has already made changes to its hiring process since it became aware of complaints from a job applicant more than a decade ago.
"We hold diversity and inclusion as core values and strive to give everyone access to the same opportunities," said Target Corp. spokeswoman Jenna Reck.
The case began in 2007, when Carnella Times filed charges against Target with the U.S. Equal Employment Opportunity Commission after she was rejected for an overnight stocker position at a store in 2006. Times, who is black, said she told Target personnel during interviews that she had a 10-year-old misdemeanor conviction.
According to the lawsuit, she received a conditional job offer that depended on a criminal background check. Times later received a letter that listed her 1996 conviction and said she would not get the job because of the background check, according to the suit.
As part of the settlement, Target will place some of those applicants who were rejected for jobs in the past 12 years due to their criminal history in a priority hiring process. Those who aren't qualified, or are unable to work, or live too far from a Target store, may receive up to $1,000. Target will spend up to $1.2 million on those payments.
Target will also give $600,000 of the settlement money to organizations that support people with criminal records. Up to $1.9 million will go to plaintiff attorney fees and litigation costs.
Minneapolis-based Target, which had about 345,000 full-time, part-time and seasonal employees as of February, said it will still use background checks during the hiring process to make sure its stores are safe. "We still believe it is important to consider an individual's criminal conviction history as part of the overall hiring process," said Reck.
But the company will give applicants a chance to explain any criminal history, and will consider the person's rehabilitation when making hiring decisions.