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Doing criminal background checks for new hires is just doing business these days, but not so fast.
A settlement against Target suggests 3.74 million reasons why companies should pay closer attention to how they use criminal histories. If employers are not careful, they may have to pay the hard way.
Target admitted no wrongdoing in the case, but it still has to pay $3.74 million to settle it.
In addition to the payout, Target will make some changes to its employment practices under the settlement. It requires experts to review Target's policies on criminal histories to help the company comply with anti-discrimination laws.
The biggest is change, which Target implemented on its own, is the company no longer asks for criminal histories in job applications. Jenna Reck, a spokeswoman said the company considers "convictions" important, but not the whole story.
"We have a number of measures in place to ensure we're fair and equitable in our hiring," while "maintaining a safe and secure working and shopping environment for team members and guests," she said.
Reuters reported that about half of the settlement money will go to the plaintiffs' attorneys for fess and other costs. The plaintiffs were represented by the NAACP Legal Defense and Education Fund and law firm Outten & Golden.
The case was based on allegations that Target "imported the racial and ethic disparities" in the U.S. criminal justice system into the company's job-screening. The company had been doing criminal background checks since 2001.
Under the class-action settlement, if approved by the court, blacks and Hispanics who were wrongfully denied hourly and entry-level jobs will receive "priority hiring" or claims against $1.2 million from the settlement. Another $600,00 will fund nonprofits that help convicts re-enter the workplace.
Sherrilyn Ifill, director of the NAACP Legal Defense Fund, commended on Target for agreeing to help "deserving Americans." She said the company's past background checks were "out of step with best practices."
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