Target pays $3.7 million to settle lawsuit over racial disparity in use of criminal background checks

The complaint, which includes grievances from more than a decade ago, allows for job applicants to reapply for Target positions or seek a financial award. 

Target Corp. has agreed to pay $3.7 million to settle a class-action lawsuit over allegations that its use of criminal background checks as part of the hiring process has disproportionately hurt African-American and Latino applicants.

The legal team representing the plaintiffs in the case includes the NAACP Legal Defense and Education Fund [and Outten & Golden LLP]. The complaint and settlement were filed Thursday morning in U.S. District Court in New York.

As part of the settlement, eligible African-American and Latino applicants who were denied employment from a Target store because of a criminal-background check since May 2006 will be eligible for priority hiring or interviewing for open positions. Alternately, they could seek a financial award of up to $1,000.

In addition, independent consultants will work with Target to recommend potential changes to its guidelines for using criminal history in hiring decisions. For example, they will look to come up with a list of convictions that are not considered job-related and would not disqualify a person from a particular job. They also will set up an internal appeals process so applicants can show evidence of rehabilitation.

Target also is giving $600,000 to five organizations that work to help individuals with criminal backgrounds find employment: AccessAbility’s Career & Education Pathways Program and RS Eden in Minnesota, Center for Employment Opportunities and The Fortune Society in New York, and A New Way of Life Reentry Project in California.

“We’re glad to resolve this and move forward,” Target said in a statement. “At Target, we have a number of measures in place to ensure we’re fair and equitable in our hiring practices. We’re an equal opportunity employer and hire team members in compliance with all applicable federal and state laws. And in hiring, like the rest of our business, we hold diversity and inclusion as core values and strive to give everyone access to the same opportunities.”

Like many major employers, Target started using criminal background checks as part of its hiring process more than a decade ago. The retailer, which employs about 345,000 workers and is among the nation’s largest employers, used to ask job applicants about their criminal history on the initial application form.

But as the so-called “Ban the Box” movement gained steam, critics complained that such screening at the outset made it difficult for ex-offenders to get jobs even if their offenses were from when they were young or were not pertinent to the positions for which they were applying.

In 2013, Minnesota passed a law barring private employers from asking about criminal history on application forms. The following year, Target removed that question from its applications nationwide.

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In the complaint, the plaintiffs argue that Target’s policies mandate automatic rejection of applicants within broad categories of certain convictions that include violence, theft, and controlled substances regardless of whether they were misdemeanors or felonies.

Such a screening process imports “the racial and ethnic disparities that exist in the criminal justice system into the employment process, thereby multiplying the negative impact on African-American and Latino job applicants,” the complaint says.

The plaintiffs in the case include Carnella Times, a 47-year-old African-American woman who applied for an overnight stocker position at a Target store in Connecticut in 2006 who was disqualified because of two misdemeanor convictions from 10 years ago. Another is Erving Smith, 40-year-old African-American man who applied for a stocker position at a store in Pittsburgh in 2014 but was disqualified because of a drug-related felony conviction from 2004.