Dillard’s Settling Racial Bias Lawsuit for $900K, Changes to Hiring Practices

Dillard’s Inc. has negotiated a settlement with the Equal Employment Opportunity Commission over claims that the department store chain practiced racial bias in hiring and promoting its employees.

The company admits no wrongdoing, but has agreed to $900,000 in back pay and compensatory damages to employees who were denied promotions. Dillard’s has also agreed to make several changes to the way it hires and promotes workers, according to documents filed in U.S. District Court for the Eastern District of Arkansas this week.

Charges of racial bias were initiated after 10 Dillard’s employees filed a complaint with the commission saying they were being unfairly passed over for promotions. Commission officials say they began investigating the complaint in early 2018 and later “engaged in numerous communications with [Dillard’s] to provide [it] with the opportunity to remedy the discriminatory practices,” but those attempts were unsuccessful.

Racial bias in employment and promoting is outlawed under Title VII of the Civil Rights Act. The act says it is illegal “to limit, segregate or classify … employees or applicants for employment in any way which would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect his status as an employee, because of such individual’s race, color, religion, sex, or national origin.”

The commission filed a class action lawsuit against Dillard’s in September alleging the department store chain’s employment practices regarding promotions and hiring were racially biased since at least January 2011.

Among the specific claims was that the company used a “tap on the shoulder approach” to filling vacancies in supervisory and managerial positions, promoting white employees – including those who had effectively been trained by the Black employees who filed the original complaint, the class action lawsuit said.

Dillard’s was able to do that, in part, because the company didn’t have a written and posted policy governing promotions, the class action lawsuit said.

Now it will.

Under the terms of the settlement, Dillard’s has agreed to develop and post promotion policies for its 330 stores nationwide.

The settlement also calls for the retailer to post supervisor and manager vacancies and to provide anti-discrimination training to all managers and supervisors working for the company.

Dillard’s has also agreed to create a dedicated e-mail account and telephone number to field employee complaints on the subject of racial inequalities in promotions, the settlement says.

According to a report by The Arkansas Democrat Gazette, the retail giant has also failed to recruit Black college students for its Executive Development Program.

To address that claim, Dillard’s has promised to “reach out to historically Black colleges and universities to recruit students into its Little Rock Buyer’s Program,” according to a news report by local Fox News affiliate Fox 16.

U.S. District Judge Lee P. Rudofsky, who has been presiding over the case, issued his approval of the settlement Thursday.

The $900,000 will be distributed among the 10 current and former Dillard’s employees who initiated the case. Among them is a woman who started working at one of the company’s department stores in Little Rock as a salesperson in 2005. Six years later, she says she was turned down for a promotion to auditor.

“The unlawful employment practices complained of … were done with malice or with reckless indifference to the federally protected rights [of the workers] because of their race, Black,” the lawsuit against Dillard’s said.

Dillard’s “steadfastly denies these allegations, but in support of its resolute commitment to the principles of equal employment opportunity for all and to avoid protracted and continued litigation,” the company agreed to settle the case, Thursday’s consent decree said.

“We are pleased by the cooperativeness and willingness of Dillard’s to revise its job posting process and hope that this will increase the number of qualified African Americans in management positions,” Faye A. Williams, regional attorney of the EEOC’s Memphis District Office was quoted in the Fox16 story as saying. “We also commend Dillard’s for working with the agency to resolve this lawsuit.”

Have you experienced racial bias in hiring or employment at Dillard’s? Have you been subject to racial bias in hiring or employment by another company? Tell us about it in the comment section below.

The Equal Employment Opportunity Commission and the proposed Class Members are represented by Pamela B. Dixon, Timothy Bowne, Faye A. Williams, Gwendolyn Y. Reams, Robert A. Canino and Sharon Fast Gustafson.

The Dillard’s Racial Bias Class Action Lawsuit is Equal Employment Opportunity Commission  v. Dillard’s, Inc., Case No. 4:20-cv-1152-LPR in the U.S. District Court for the Eastern District of Arkansas, Central Division.

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