Three employment tests used by Target Corp. disproportionately screened out applicants for exempt-level professional positions based on race, sex and disability, the EEOC said, and the retailer agreed to pay $2.8 million to settle the charge.
The assessments were not sufficiently job-related and consistent with business necessity, violating Title VII of the Civil Rights Act of 1964, the US Equal Employment Opportunity Commission said in an Aug. 24 press release.
The retailer didn’t respond to requests for an interview from Advisen.
The EEOC said it also found that one of the assessments performed by psychologists for Target constituted a pre-employment medical examination, which employers are prohibited from administering prior to an offer of employment under the Americans with Disabilities Act. The retailer failed, too, to maintain sufficient records for assessing the impact of its hiring procedures, the agency said.
Thousands of people were adversely affected when Target used these assessments in its hiring process, the EEOC said. The monetary settlement will be divided among the individuals, with the retailer paying for a claims administrator to distribute the funds.
The agency said the settlement helped the company avoid potentially protracted litigation.
“We applaud Target for taking corrective action to ensure the validity of their hiring practices,” said EEOC Chair Jenny R. Yang. “This resolution demonstrates the benefits of working with EEOC and serves as a model for businesses committed to effective and lawful selection procedures.”
Target discontinued the use of the three tests after the EEOC opened its investigation, and agreed not to use them again as part of its exempt-level employment selection procedures. The retailer also made changes to its applicant-tracking systems to ensure that the collection of data is sufficient to assess adverse impact.
The retailer agreed to perform a predictive validity study for exempt-level professional assessments it uses and expects to use, and will monitor them for adverse impact based on race, ethnicity and gender. It also will provide the EEOC with a yearly summary of these studies.
Target also agreed to retain an experienced outside consultant to provide a minimum of two hours of training at least once per year to all personnel responsible for the development and implementation of exempt assessments on record keeping, the ADA and pre-employment medical exams, and on disparate impact in employment selection procedures.
