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Dollar General sued over background check policy

5:18 PM, Jun 12, 2013   |    comments
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By Duane Marsteller / The Tennessean

The U.S. Equal Employment Opportunity Commission is suing Dollar General Corp. over its criminal background checks of new hires and employees, a case that legal experts say could affect hiring practices nationwide.

In a civil lawsuit filed in Chicago on Tuesday, the federal agency said the Goodlettsville, Tenn.-based retailer has "engaged in ongoing, nationwide race discrimination against black applicants" for nearly a decade.

The suit contends the company's practice of using criminal background checks disproportionally affects blacks, who have higher arrest and conviction rates than whites. The agency also filed a similar suit Tuesday against a BMW manufacturing plant in South Carolina.

"Overcoming barriers to employment is one of our strategic enforcement strategies," EEOC spokeswoman Justine Lisser said. "We hope that these lawsuits will further educate the public and the employer community on the appropriate use of conviction records."

In a statement, Dollar General denied the EEOC's allegations and said the company would "vigorously defend" itself.

"Dollar General's criminal background check process is structured to foster a safe and healthy environment for its employees, its customers and to protect its assets in a lawful, reasonable and non-discriminatory manner," the company said.

The suits are the first since the EEOC revised guidelines last year that included urging employers to stop asking about past convictions on job applications and allow applicants to explain past criminal conduct before they are rejected.

The commission said it wanted to prevent limiting job opportunities for those with criminal records who "have been held accountable and paid their dues."

The agency sued Dollar General on behalf of an unidentified woman hired at the company's Waukegan, Ill., location in 2004. Although the woman disclosed a 1998 felony conviction for possession of a controlled substance before she was hired, she was fired shortly after beginning work because it - and a misdemeanor conviction for possession of drug paraphernalia - appeared on her background report, the suit said.

She fell victim to a Dollar General hiring policy that unilaterally bans those with certain convictions within certain time frames from working for the retailer, according to the suit.

For example, the company won't hire anyone convicted in the previous 10 years of flagrant non-payment of child support or possession of drug paraphernalia, the suit said. Those convicted within the past three years of illegal dumping or improper supervision of a child also won't be hired.

The EEOC's suit contends the policy is too strict and doesn't consider other factors, such as the applicant's age and whether the crime was job-related.

The policy has resulted in blacks being rejected at a higher rate than whites, although blacks received just a quarter of job offers during a recent 2½-year period, the suit said, citing data provided by Dollar General.

The two cases likely won't end the use of background checks, but could change how they're used, two Nashville labor attorneys said.

"It may require the employer to have more justification as to why some smaller crimes are grounds not to hire an applicant," Jim Higgins of The Higgins Firm wrote in an email. "(Still), no one is going to be required to hire a bunch of criminals and no one is going to mandate that they stop using background checks."

Higgins also said he doesn't believe EEOC is overreaching with the suits - a contention disputed by an attorney who represents employers in labor issues.

"The EEOC is putting forward some very aggressive interpretations of the law," said Zan Blue of Constangy, Brooks & Smith. "These are test cases, and the defendants are unfortunate that they got selected. The EEOC chose high-profile targets for a reason - to make examples of them."

He also said he believes Dollar General "will be a formidable foe" for the EEOC.

The BMW case focuses on a contractor that staffed a warehouse in Spartanburg, S.C., where the suit was filed.

The contractor's policy was not to employ anyone with a criminal record within the past seven years. When a new contractor took over, BMW ordered a new round of checks and fired those with a criminal record from any year - even those who had worked at the warehouse for more than a decade, that suit said.

Of the 88 workers fired, 70 were black, the suit said.

BMW spokesman Sky Foster said the company "believes that it has complied with the letter and spirit of the law and will defend itself against the EEOC's allegations of race discrimination."

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