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Labor Law: Walmart's $20 million sex bias settlement is a good reminder for employers to examine hiring criteria
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Labor Law

Labor Law: Walmart's $20 million sex bias settlement is a good reminder for employers to examine hiring criteria

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20150817_MBZ_KAREN

RTD Metro Business law columnist, Karen Michael.

Walmart has agreed to pay $20 million to settle a companywide hiring lawsuit filed against the retail giant by the Equal Employment Opportunity Commission alleging sex discrimination.

At issue was Walmart requiring applicants to successfully complete a physical agility test when applying to be an “order filler” at its grocery distribution centers nationwide. The test disproportionately excluded female applicants, resulting in disparate impact on women.

When a pre-employment test results in a disparate impact, the employer must show that the test is necessary for the safe and efficient performance of the specific job, and that there are not alternative practices that can achieve the employer’s objectives but have a less discriminatory effect.

In announcing the settlement earlier this month, the EEOC said: “One of the EEOC’s six national priorities is eliminating barriers in recruitment and hiring. Employers need to ensure their testing and screening practices do not discriminate against any group.”

In addition to the financial settlement, Walmart agreed to cease all physical agility testing for the position.

This case is a reminder that even where a business has not engaged in intentional discrimination, its policies and practices may inadvertently cause individuals to be denied opportunities in violation of discrimination laws.

Most companies appropriately set forth policies and procedures to prevent explicit discrimination and bias. As the nation continues dialogue on implicit bias, employers should do more to uncover the implicit bias preventing individuals from advancement.

Employers should be testing every aspect of their employment practices to determine if and where people of color, women, those with disabilities and others fall out of the system. Employers should be examining hiring practices, promotions, compensation, and other benefits.

In doing so, businesses should carefully examine criteria currently being required, but which might not be necessary for the successful performance of the position, such as degrees or certifications.

In addition, employers should carefully examine any pre-employment testing (be it physical or otherwise) to make sure that the test is validated for that specific position, and that the criteria is properly administered.

Sometimes, for example, a test is validated for one position if the person scores above 70 and then the employer may arbitrarily increase the criteria to a passing score of 80, thus resulting in a disparate impact without a legitimate criterion being applied.

The process to uncovering these types of potential biases begins with intentional planning and assessment. Employers should review each job description, hiring practice, promotional opportunity, compensation practices and similar employment benefits to determine whether the established criteria are necessary for the successful performance of the role. Then, remove unnecessary and non-essential criterion that create barriers, thus promoting and creating equal opportunities.

Removing unnecessary barriers and stereotypes in the hiring and promotions process will bring employers closer to achieving the necessary equity within organizations.

Karen Michael is an attorney with Richmond-based KarenMichael PLC. She can be reached at kmichael@karenmichaelconsulting.com.

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