Judge Rules on Landmark Settlement in Sex Discrimination Lawsuit Against Rent-A-Center, Company Pledges to Overhaul Corporate Culture to Encourage and Promote Women

Furniture World Magazine

A U.S. District Court judge handed down a ruling approving a nationwide multi-million dollar settlement in a sex discrimination class action suit brought by women employees against national rent-to-own chain, Rent-A-Center. In his ruling, Judge David Herndon wrote, “class counsel’s herculean effort and commitment of resources to defeat [an attempted lower settlement] was unprecedented and involved risk never before undertaken in a national employment discrimination class action.” Barry Goldstein, a nationally-renowned employment discrimination lawyer testified that “the attorneys accomplished more for this class in two years than any private counsel has ever accomplished for a comparable, large, national employment discrimination class within a two-year period.” And Judge Herndon agreed. Under the terms of the agreement, Rent-A-Center will pay a cash settlement of $47 million, hire ten percent of its workforce from women who are class members and make significant changes to hiring, firing and promotions policies. A Human Resources Department will be created. According to a nationally-renowned statistician the value of this affirmative relief is over $68 million, for a total settlement value of $115 million. The settlement covers two cases with a potential class of more than 5,000 women: Wilfong et al. and EEOC v. Rent-A-Center in the U.S. District Court for the Southern District in East St. Louis, Illinois and Equal Employment Opportunity Commission v. Rent-A-Center in the U.S. District Court for the Western District of Tennessee in Memphis. The suits alleged widespread blatant sex discrimination and harassment against women Rent-A-Center employees, which management at all levels not only sanctioned but participated in. Plaintiffs in Wilfong are represented by the law firms of Schlichter, Bogard & Denton and Sedey & Ray. Rent-A-Center has 2294 stores nationwide. “This settlement will completely change the corporate culture at Rent-A-Center,” said attorney Jerome Schlichter, of Schlichter, Bogard & Denton of St. Louis. “For the first time employees will have an advocate in the Human Resources Department. Women will be able to go to work without worrying about being harassed. Promotions will be based on ability, rather than gender. And sex discrimination and harassment will not be tolerated anywhere at any time. It is an unprecendented result.” “This case is historic,” said Mary Anne Sedey, of Sedey & Ray. “This is the largest nationwide employment sex discrimination case for a company of this size. Rent-A-Center will serve as an example to other companies—harassment and discrimination will not be tolerated under any circumstances.” The settlement, reached in March, includes the following provisions: •Rent-A-Center agrees to fill ten percent of job vacancies in the first 15 months following the settlement with women who were fired because of their sex since the 1998 acquisition of Rent-A-Center, or who were rejected as job applicants because of their sex. •Rent-A-Center will set up, publicize and pay for a toll-free number to be used by women job applicants or employees to report discrimination. Human resources professionals hired by Rent-A-Center will answer and respond to these calls. •Rent-A-Center will provide quarterly reports for four years that include: descriptions of new employment policies and training programs the company implements; descriptions of any sex discrimination complaints for job applicants or employees; and statistical information by gender regarding hiring, promotion and termination of employees. •Rent-A-Center will create a Human Resources department with an experienced human resources vice president who will be given the resources necessary to develop, implement and monitor policies that ensure equal employment opportunity for women job applicants and employees. •Rent-A-Center will publicize its desire to recruit qualified and interested women for jobs in its stores and for promotion into all jobs at all levels. •Rent-A-Center will hire and retain a neutral, agreed-upon, qualified, third-party consultant who will serve as a resource to the human resources department and an ombudsman to employees and will consult on Rent-A-Center’s new employment policies, which will include written qualifications for hiring and promotion. •Rent-A-Center will produce and show a videotape featuring CEO Mark Speese and President Mitch Fadel that spells out the company’s commitment to nondiscrimination and includes messages that the company welcomes women, values their contributions and will ensure that women are on a level playing field for jobs and promotions. Speese and Fadel will indicate that they recognize that there have been allegations of sex discrimination at Rent-A-Center, that they do not approve of discriminatory conduct based on sex, and that the company will not tolerate such conduct. They will also encourage employees to report sex discrimination. A court-appointed Special Master, who is compensated by the company, will decide disputes regarding sex discrimination. •Rent-A-Center will seek qualified women to serve on its currently all-male Board of Directors. •Rent-A-Center will develop effective equal employment opportunity training programs for all employees at all levels. These trainings will include, but not be limited to, presentations at annual meetings. •Rent-A-Center will notify in writing all women job applicants who were rejected since August 2000 of the settlement of the case, encouraging them to respond if they wish to work for the company.