Retail

In light of a yawning pay gap between white associates and their black and Latino coworkers, retailers have found themselves in the uncomfortable spotlight of the equality debate lately.

From a question of religious freedom at the Supreme Court to a flame-throwing lawsuit against Zara USA Inc. brass and a yawning pay gap between white associates and their black and Latino coworkers, retailers have found themselves in the uncomfortable spotlight of the equality debate lately.

This story first appeared in the June 10, 2015 issue of WWD. Subscribe Today.

The sector employs a large and very visible chunk of the U.S. workforce with more than 15.6 million people making up some 11 percent of the country’s nonfarm payrolls.

There are plenty arguing that stores can do better by their workers.

The Supreme Court ruled against Abercrombie & Fitch in a case involving a Muslim woman who said she was denied a position because she wore a head scarf to a job interview. Zara came under fire this week in a $40 million suit from a former general counsel who said he was discriminated against because he was Jewish, American and gay in an environment favoring people who are straight, Spanish and Christian. (A Zara spokesman affirmed the company’s commitment to fairness, respect and equality.)

A recent Demos and NAACP report titled “Retail Race Divide: How the Retail Industry Is Perpetuating Racial Inequality in the 21st Century” also digs into the issue.

The report asserts that retailers pay their black and Latino full-time workers roughly 75 percent of what their white peers make, adding up to a discrepancy of $7,500 annually. Black and Latino retail employees are also overrepresented in positions with the lowest pay and least stability.

“Retail is one of the largest sources of new employment in the U.S. economy, and the second-largest industry for black employment in the country,” the report said. “At the same time, the most common occupations — retail salesperson and cashier — show evidence of a racial opportunity divide. These conditions point to an important chance for retail employers to make a real impact on racial inequality by paying living wages and offering stable, adequate hours for all workers.”

The report suggests a number of remedies: a raise in the federal minimum wage, an end to the practice of evaluating the credit history of job applicants, a focus on full employment in monetary policy, protection for the rights of part-time workers and more unions in retail.

Dedrick Asante-Muhammad, senior director of the NAACP’s economic department, told WWD that retail is playing a central role in the debate over equality because of its importance in the economy.

“Increasingly, a person who’s working in retail is providing 50 percent of a household income,” he said. “These jobs are being used in a way they weren’t in the past. Retail, being so big, it is now at the center of economic issues [and] wage issues.”