Target has agreed to pay $2.8m to settle claims with the US Equal Employment Opportunity Commission (EEOC) for its unjust behavior in hiring.
The settlement amount will be distributed among those who were affected by Target’s discriminatory hiring practices.
During an investigation by EEOC, the retailer was found guilty for screening out thousands of applicants for exempt-level professional positions based on race and sex.
The retailer’s employment assessments violated Title VII of the Civil Rights Act of 1964.
EEOC also found that the company used a pre-employment medical examination which violated the Disabilities Act, preventing employers from conducting medical tests on applicants before employing them.
Target also failed to maintain records sufficient to assess the impact of its hiring procedures.
The retailer agreed to stop using these assessments for hiring exempt-level professional positions, in addition to modifying its applicant tracking systems to ensure that the collection of data is sufficient to assess adverse impact.
Target will also monitor the assessments it uses for exempt-level professional positions for adverse impact based on race, ethnicity and gender.
EEOC Chair Jenny R. Yang said: "We applaud Target for taking corrective action to ensure the validity of their hiring practices.
"This resolution demonstrates the benefits of working with EEOC and serves as a model for businesses committed to effective and lawful selection procedures."