Dollar General Agrees to Pay $6 Million for Alleged Race Bias in Hiring Process


Lisa Nagele-Piazza, J.D., SHRM-SCP By Lisa Nagele-Piazza, J.D., SHRM-SCP November 19, 2019
Dollar General Agrees to Pay $6 Million for Alleged Race Bias in Hiring Process

​Dollar General will pay $6 million to settle a race-discrimination lawsuit brought by the U.S. Equal Employment Opportunity Commission (EEOC).

The EEOC alleged that the discount retailer violated Title VII of the Civil Rights Act of 1964 by using a broad criminal background check that led the company to deny jobs to black applicants at a much higher rate than white applicants. Dollar General agreed to the settlement without admitting any wrongdoing.

We've rounded up articles and resources from SHRM Online and other trusted media outlets on criminal background investigations and second-chance hiring.

Disparate Impact 

Businesses must ensure that employment screens, including criminal background checks, don't have a disparate impact on job candidates based on a protected category, such as race or sex. "Disparate impact" means that a seemingly neutral policy is discriminatory in practice. Such practices are unlawful under TVII unless the employer can show that the screen is job-related and a business necessity, according to the EEOC.

Dollar General will pay the $6 million into a settlement fund for black job applicants who lost an employment opportunity between 2004 and 2019. The company also must hire a criminology consultant if it wants to continue using criminal background checks in its hiring process. The EEOC said the company should consider the following factors when reviewing an applicant's criminal history:

  • Time passed since the conviction.
  • Number of offenses.
  • Nature and gravity of the offense.
  • Risk of recidivism.

Under the settlement agreement, Dollar General may not discourage people with criminal backgrounds from applying and is prohibited from retaliating or otherwise discriminating on the basis of race when conducting background checks.


[SHRM members-only HR Q&A: What are disparate impact and disparate treatment?]

Ban-the-Box Laws

Employers should check their state and local laws to see if a so-called ban-the-box law applies to their worksites. These laws prohibit employers from asking job applicants about their criminal history until a certain stage of the process—some laws allow such questions after an initial interview and others ban queries until after a conditional offer is made. More than 30 states and 150 cities and counties have adopted ban-the-box laws that generally apply to public employers but also may apply to private businesses. The main goal of these laws is to prompt employers to first consider a job applicant's qualifications without the stigma of a criminal record.

(National Employment Law Project)

Second-Chance Hiring Is a Growing Trend

Second-chance hiring—recruiting and hiring people with criminal backgrounds and eliminating obstacles to those efforts—is building momentum among policymakers, according to business community leaders and worker advocates.

(SHRM Online)

Getting Talent Back to Work

The Society for Human Resource Management (SHRM) is a leader in the effort to provide second chances to people with criminal backgrounds. SHRM created a pledge for individuals, companies, associations and nonprofits to sign, promising to give a second chance to qualified people with criminal records. The Getting Talent Back to Work website gives employers resources to learn about and recruit from this large group of potential talent.  

(SHRM Online)

Quiz: Hiring Individuals with Criminal Records

More employers are hiring workers with criminal records to meet their organization's staffing needs but complying with the law when making decisions based on an applicant's criminal history can be complicated. Take this quiz to test your knowledge on the use of criminal background checks in employment decisions.

(SHRM Online)

Visit SHRM's resource page on workforce readiness


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