Known for their good-looking, all-American, and mostly white male and female clothing models, Abercrombie & Fitch has become a different kind of model of late-a model of alleged employment discrimination. The clothing icon recently settled two private class actions and a civil action by the United States Equal Employment Opportunity Commission ("EEOC") by agreeing to pay more than $40 million to African American, Hispanic, and Asian plaintiffs who alleged that Abercrombie discriminated against them; Abercrombie also entered into a settlement with the EEOC known as a Consent Decree. In Gonzalez, et al. v. Abercrombie, et al., West v. Abercrombie, et al., and EEOC v. Abercrombie & Fitch Stores, Inc., the plaintiffs argued that they were either limited to low visibility, back-of-the-store type jobs or terminated because of their race or ethnicity.
The Consent Decree provides very detailed guidance on the development and implementation of diversity initiatives that the EEOC is now requiring of Abercrombie. In particular, the Consent Decree states that Abercrombie shall ensure equal employment opportunity and "provide for the implementation of recruitment, selection and personnel systems that will ensure that African-Americans, Asian-Americans, Latinos and women are considered for recruitment, hire, job assignment and managerial promotion for which they are interested and qualified on a non-discriminatory basis."
This means some organizational change for Abercrombie. The Company will name a Vice President of Diversity and hire 25 recruiters to seek out minority employees. Additionally, Abercrombie will have to pursue benchmarks for the hiring and promoting of a racially diverse workforce, and the retailer will report its progress regularly to the plaintiffs' attorneys and to an official named by the court. The EEOC's Consent Decree also requires Abercrombie to offer diversity training and education programs that will be overseen by the Company's new Vice President of Diversity.
The Consent Decree further requires that Abercrombie abandon its practice of recruiting employees from predominantly white fraternities and sororities, a practice that helped Abercrombie develop its trademark "A&F look." Not only were the clothing models used in Abercrombie's marketing materials predominantly white, youthful, and strikingly attractive, but the sales staff in the stores were also mostly good-looking white young adults. Indeed, it was the consistent reinforcement of the "A&F look" throughout Abercrombie's organization and marketing that led to what might be the EEOC Consent Decree's most interesting requirement.
The Consent Decree specifically requires that Abercrombie must "reflect diversity, as reflected by the major racial/ethnic minority populations of the United States, in its marketing materials (taken as a whole)." Not only must Abercrombie change its recruitment and hiring practices so as to avoid discrimination, but it must also avoid the appearance of discrimination in its marketing materials. The former all white "A&F look" is to be no more. Abercrombie now must include African-American, Asian-American, and Latino models in their "quarterly magazines and similar materials, shopping bags, store posters and video, website, A&F TV, and purchased advertising." The purpose of this marketing shift is to encourage minorities to apply for employment with Abercrombie.
"This agreement promises to transform this company, whose distinctiveness will no longer stem from an all-white image and workforce," stated Thomas A. Saenz, Vice President of Litigation for the Mexican American Legal Defense and Educational Fund (MALDEF). Supporters of the Consent Decree hope that minority applicants feel encouraged and welcomed by this change in Abercrombie's branded image, and some are even turning their attention toward other companies that may have a racially or ethnically exclusive image.
"Abercrombie now realizes diversity makes good business sense," asserts Kimberly West-Faulcon, Director and Western Regional Counsel for the NAACP Legal Defense and Educational Fund. "We hope the rest of corporate America gets the message." Corporate America would be wise to pay attention to Abercrombie's settlement with the class action plaintiffs and the EEOC and learn from the Company's mistakes. Promoting diversity is not just a nice idea; it has become a real issue in employment practices that can give rise to potential EEO liability.
For more information on maintaining a diverse workforce, check out, Managing Diversity in the Workplace