Abercrombie & Fitch, one of the trendiest U.S. retailers, has settled race and sex discrimination lawsuits, agreeing to alter its well-known collegiate, all-American and largely white image by adding more blacks, Hispanics and Asians to its marketing materials.
After a federal judge in San Francisco approved the class-action settlement Tuesday, the two sides announced an agreement that calls for Abercrombie & Fitch to pay $40 million to several thousand minority and female plaintiffs.
Abercrombie also agreed to hire 25 diversity recruiters and a vice president for diversity and to pursue benchmarks so that its hiring and promotion of minorities and women reflect its applicant pool.
In an unusual step, the settlement calls for Abercrombie to increase diversity not just in hiring and promotions, but also in its advertisements and catalogs which have long featured models who were overwhelmingly white and who seemed to have stepped off the football field or out of elite university fraternities or sororities. Plaintiffs' lawyers said they had insisted that the company agree to more diversity in its marketing materials so as not to discourage minorities from applying for jobs.
In another unusual move, the settlement requires Abercrombie to stop focusing on predominantly white fraternities and sororities in its recruitment. Many Abercrombie workers have said that company employees often are told to go to university campuses and urge attractive fraternity and sorority members to apply for jobs.
When Abercrombie was sued in June 2003, several Hispanic, black and Asian plaintiffs complained that when they had applied for jobs, they were steered not to prominent sales positions but to low-visibility, back-of-the-store jobs like stocking and cleaning up.
"Abercrombie had a back-of-the-bus mentality," said Kimberly West-Faulcon, Western regional counsel for the NAACP Legal Defense and Education Fund. "Now instead of hiring them in the back of the store, they will have diversity recruiters. It sends a message to young people that we're moving past this kind of thing."
Abercrombie, which did not admit guilt, agreed to hire a monitor, to provide diversity training to all managers involved in hiring and to revise performance evaluations for managers, making progress in diversity goals a factor in bonuses and compensation. The settlement also called for payment of $7.2 million in lawyers' fees. In a statement, Mike Jeffries, the Abercrombie chairman, said: "We have, and always have had, no tolerance for discrimination. We decided to settle this suit because we felt that a long, drawn-out dispute would have been harmful to the company and distracting to management."
Several industry analysts said the settlement would help Abercrombie's marketing. "Their profile, their image is going to evolve," said Robin Murchison, a retail analyst with Jefferies & Co.
Source: The International Herald Tribune (http://www.iht.com )