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Dillard’s to Pay $2M to EEOC

Store said to violate Americans with Disabilities Act.

WASHINGTON — The Equal Employment Opportunity Commission said Tuesday that Dillard’s Inc. has agreed to pay $2 million to settle a four-year-old class-action disability discrimination lawsuit.

The EEOC said the department store chain had a “long-standing national policy and practice” requiring that all employees disclose personal and confidential medical information when asking for sick leave, which is a violation of the Americans with Disabilities Act.

“Policies and practices that permit medical inquiries without proof of a valid business necessity run afoul of the law, often having large-scale consequences,” said Anna Park, regional attorney for the EEOC’s Los Angeles District Office. “All employers should carefully examine their own policies and practices to ensure compliance with federal law.”

The ADA prohibits employers from inquiring about the disabilities of their employees unless it is “job-related and necessary for the conduct of business.”

The retail chain was also accused of firing employees for taking sick leave beyond the maximum amount of time allowed, the EEOC said. The settlement requires Dillard’s to comply with company-wide injunctive relief of their practices relating to sick leave. The EEOC said the company has agreed to measures that will “prevent and effectively address potential disability discrimination.”

The EEOC filed a lawsuit against Dillard’s in 2008 in U.S. District Court for the Southern District of California on behalf of Corina Scott, a former cosmetics counter employee at one of the company’s stores in El Centro, Calif., and others who were required to disclose the “exact nature of their medical conditions for sick leave approval,” dating as far back as 2005.

The EEOC said many of the class plaintiffs in the lawsuit had notices from doctors verifying that their request for sick leave was due to medical reasons, but many did “not feel comfortable” disclosing the specifics of their conditions to the company. It also charged that Scott, who took four days off, and others with varying lengths of sick leave, were subsequently fired by Dillard’s in retaliation for their refusal to provide details of their medical condition.

In addition, the EEOC claimed that Dillard’s enforced a “maximum-leave policy,” in which the amount of health-related leave an employee could take was limited without discussing with employees whether more leave time was allowed under the ADA because of the person’s disability. The district court ruled that Dillard’s medical disclosure policy was “facially discriminatory” under the ADA.

Dillard’s denied in a statement that either of its policies cited by the EEOC violates the ADA, but said, “In order to avoid further protracted litigation with the EEOC over policies that are no longer in effect, Dillard’s determined that the most efficient resolution was to settle with the EEOC. Under the settlement, the company agreed to not reinstate the policies at issue as well as to other injunctive relief, and to establish a Class Fund from which current and former associates who believe they were adversely affected by the policies can make a claim.”

The EEOC said it expects to identify thousands of victims employed by Dillard’s through the claims notice process, which will distribute the class fund under the settlement.

Anyone who worked at a Dillard’s store — other than the El Centro unit — between Aug. 16, 2005, and Aug. 15, 2009, and believes he or she was affected by the policy, can file a claim. In addition, employees who believe they were terminated by the company after May 28, 2008, for taking too much leave may also be eligible to make a claim.