Ouch! Alleged hiring preference costs employer $700K

Expressing a hiring preference for a particular gender can be a very dangerous thing for employers to do.

Why? Because there is a good chance it will lead to a claim of unlawful discrimination – and that the claim will succeed.

An Indiana employer just learned that lesson the hard way, agreeing to settle an EEOC lawsuit filed against it by paying out more than $700,000 and taking other remedial steps.

In the suit, the EEOC accused the Kenneth O. Lester Company, Inc., which does business as PFG Customized Distribution, of refusing to hire female job applicants for order selector positions at its warehouse in Kendallville, Indiana.

Illegal hiring preference alleged

According to the agency, the sex-based preference was specifically expressed across the board – by hiring officials, other management and supervisory employees, human resources personnel, and even recruiters.

Some of those individuals told female applicants directly that PFG prefers to hire men as order selectors, the suit added.

The suit alleged a violation of Title VII, which generally bans the use of sex-based criteria in employment decisions.

To end the case, PFG agreed to pay a total of $709,971. The bulk of that amount — $650,000 – will go to a class of female applicants who were not hired. In addition, $39,971 will be paid to a female applicant who spurred the suit, and $20,000 will go to a class of females who were given work assignments based on their sex.

Stop doing that

The agreement ending the litigation also bars PFG from:

• Refusing to hire women as order selectors based on their sex
• Setting work assignments based on sex, and
• Retaliating against employees.

PFG will also:

• Extend a hiring preference to qualified female applicants who were denied jobs as order selectors
• Revise hiring practices and procedures, and
• Conduct equal employment opportunity training.

What Title VII prohibits

Under the federal law generally known as Title VII, covered employers generally cannot discriminate against job applicants or employees based on sex, which is defined to include pregnancy, sexual orientation and gender identity.

This means that as a general rule, employers may not express a preference for one gender over another or exclude one gender from consideration when hiring.

When it might be OK

An exception to the general rule applies when gender qualifies as what is called a bona fide occupational qualification, more commonly referred to as a BFOQ.

Title VII specifically carves out the BFOQ exception to its general ban on discrimination, expressly stating that it is not unlawful to hire a job candidate based on sex provided that sex “is a bona fide occupational qualification reasonably necessary to the normal operation of that particular business or enterprise.”

So just when does this exception apply?

First, remember that this is a very narrow exception to the general rule banning discrimination. It applies only when an employer can show, in defense to a charge of discrimination, that only the preferred sex has characteristics that are needed to do the job. Those characteristics cannot be based on stereotypical assumptions.

A few examples

To explain further, let’s look at a few examples.

Example 1: An employer refuses to consider women for a loading dock position because the position requires employees to lift 100-pound boxes. The employer excludes women based on its assumption that women cannot lift 100-pound boxes. Because this assumption is false, the employer would not be able to successfully assert a BFOQ defense to a charge of illegal gender bias.

Example 2: A women’s clothing store hires only female fitting room attendants. It sets the limitation because it believes that for privacy reasons, its customers would object to having males do the job. In this case, the employer is likely to prevail when presenting the defense that being female is a BFOQ for the job.

Example 3: A prison has sex-segregated wards, and the duties of prison guards include searching prisoners and observing them while they shower. In this case, the prison is likely to successfully defend a policy of hiring only female prison guards to work on female wards.

Remember: It’s a narrow exception

While the concept of the BFOQ defense is an important one to be aware of, remember that it is narrow and did not come into play in the PFG litigation.

Takeaway: Be very careful about setting a sex-based preference for an employment position. Such a preference usually constitutes unlawful discrimination.