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New York: Companies Settle Claims for Discriminating against Ex-Felons

New York: Companies Settle Claims for Discriminating against Ex-Felons

by Gary Hunter

National retailer Bed Bath & Beyond forked over a large settlement in April 2014 after New York’s Attorney General caught the company illegally discriminating against ex-offenders seeking employment. The housewares mega-chain, which operates 62 stores in New York, will pay a settlement totaling $125,000. Of that amount, $40,000 is for restitution to job applicants who were denied employment, and $45,000 will be split equally among the Center for Employment Opportunities, the Osborne Association and the Doe Fund, which provide services for former prisoners. Bed Bath & Beyond will also “ban the box” that asks about prior felony convictions on its job applications.

“This agreement puts employers on notice that slamming the door on jobseekers based on past conduct without deciding whether that conduct is relevant to the current job is not only wrong – it’s unlawful,” stated Attorney General Eric T. Schneiderman.

New York law prohibits businesses from applying blanket bans on hiring ex-offenders, though companies are not prohibited from checking a job applicant’s background so long as they take mitigating factors into consideration, such as the nature of a conviction, the length of time since it occurred and evidence of rehabilitation.

An investigation into Bed Bath & Beyond was launched after a human resources manager revealed at a job fair that the company did not hire ex-felons. Schneiderman also found evidence that HireRight, Inc., First Advantage, General Information Services, Inc. and Sterling Infosystems, which provide background checks, were in violation of state law, too. In May 2014, the Attorney General’s office announced it had reached a settlement agreement with the four companies that prohibits them “from automatically disqualifying applicants with criminal convictions.” The settlement did not involve any financial penalties.

“New Yorkers who have paid their debt to society deserve a fair shot at employment opportunities,” Schneiderman said. “Background check agencies that implement blanket bans on hiring ex-offenders are violating New York State law. My office is committed to reforming practices in this industry that frustrate efforts at rehabilitation.”

Additionally, the Attorney General’s Civil Rights Bureau announced a settlement with Party City on October 2, 2014; a representative for the company, which operates 49 stores in New York, had stated at a job fair that ex-felons could not obtain full-time employment. Party City agreed to change its hiring policies, reconsider job applications previously submitted by ex-offenders and pay a $95,000 penalty. Further, as with Bed Bath & Beyond, the company removed questions related to criminal history from its job applications.

Previously, in May 2013, the state had reached an agreement with Quest Diagnostics, Inc., a company that provides medical testing and services, to modify its hiring practices. Quest also paid a $70,000 penalty and agreed to comply with state requirements related to hiring people with criminal records. Further, the town of Oswego, New York also came into compliance with state law by eliminating a local ban that prevented ex-felons from obtaining taxi licenses.

“Excluding anyone with a criminal history from employment undermines public safety,” said Madeline Neighly, a staff attorney for the National Employment Law Project. “Employment is key to reducing recidivism and strengthening families and community involvement.”

The U.S. Equal Employment Opportunity Commission has sued Dollar General Stores (Dolgencorp LLC) and BMW for similar unfair hiring practices. The companies are accused of violating federal civil rights laws by discriminating against ex-felons, and both cases remain pending. [See: PLN, Feb. 2014, p.40].


Sources: Business Week,


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