Pepsi agrees to $3.13 million settlement for background check policy that violated Civil Rights Act

Pepsi Beverages has agreed to pay $3.13 million and provide job offers and training to resolve a charge of race discrimination filed at the U.S. Equal Employment Opportunity Commission (EEOC) regarding its previous pre-employment screening policy.

According to the press release put out by the EEOC, the commission’s investigation revealed that “more than 300 African-Americans were adversely affected when Pepsi applied a criminal background check policy that disproportionately excluded black applicants from permanent employment. Under Pepsi’s former policy, job applicants who had been arrested pending prosecution were not hired for a permanent job even if they had never been convicted of any offense.”

The press release continues: “Pepsi’s former policy also denied employment to applicants from employment who had been arrested or convicted of certain minor offenses. The use of arrest and conviction records to deny employment can be illegal under Title VII of the Civil Rights Act of 1964, when it is not relevant for the job, because it can limit the employment opportunities of applicants or workers based on their race or ethnicity.”

Pepsi has since adopted a new criminal background check policy. The settlement will mostly be divided among black applicants for positions at Pepsi.

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Kristina Taylor
In 1989, Kristina began her career as a customer service representative at the newly formed American Tenant Screen, Inc. Ten years later, she pioneered tenant background screening on the Internet. As a long-standing member of the National Multifamily Resident Information Council (formerly the National Association of Screening Agencies) Kristina gains insight into the trends of the tenant screening industry to better understand the current and future needs of their clients.

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