National Rent-to-Own Company Reaches Precedent-Setting Sex Discrimination Lawsuit Settlement, Pledges to Overhaul Corporate Culture to Encourage and Promote Women

Press Release, Schlichter Bogard & Denton
via Business Wire

ST. LOUIS - Attorneys for more than 5,000 women in a national multi-million dollar sex discrimination class action suit and the United States Equal Employment Opportunity Commission (EEOC) today announced that they have reached a tentative settlement in principle with national rent-to-own chain, Rent-A-Center.

The settlement covers two pending cases with a potential class of more than 5,000 women, Wilfong, et. al. and EEOC v. Rent-A-Center in the U.S. District Court for the Southern District in East St. Louis, Illinois and Equal Employment Opportunity Commission v. Rent-A-Center in the U.S. District Court for the Western District of Tennessee in Memphis, Tennessee. It includes a cash settlement of $47 million and an agreement on the part of the rent-to-own giant to make significant changes to its hiring, firing and promotions policies and to create and maintain a Human Resources Department, which had been dissolved when Renters Choice acquired Rent-A-Center in 1998. This is the largest nationwide employment sex discrimination case for a company of this size. Rent-A-Center has 2,294 stores nationwide.

The plaintiffs in Wilfong are represented by the law firms of Sedey & Ray and Schlichter Bogard & Denton of St. Louis. The EEOC, which is a plaintiff/intervenor, is represented by attorneys Donna L. Harper, Anne Gusewelle and Andrea Baran.

"The women of Rent-A-Center will finally obtain well-deserved justice," said Mary Anne Sedey of Sedey & Ray. "This settlement provides significant benefits for the women who brought this case of sex discrimination and creates genuine opportunities for all women at Rent-A-Center in the future."

"This is an unprecedented settlement for an employment discrimination case," said attorney Jerome Schlichter, of Schlichter Bogard & Denton. "It is particularly important that Rent-A-Center has agreed to vacate the previously agreed-upon settlement in the Bunch case, which would have cost the company less and could have eliminated the claims of the women we represent. This company, its culture and its environment have been changed forever."

The settlement will supercede an earlier settlement in principle reached in a parallel lawsuit (Bunch et. al. v. Rent-A-Center) for $15 million. The attorneys in the Wilfong case, the EEOC and the National Organization Women for Foundation opposed that settlement as inadequate and unfair. Although the Bunch case will be dismissed as a result of this new settlement, the plaintiffs in that case will be entitled to their portion of this new settlement.

"The Commission is particularly pleased that this settlement will move Rent-A-Center closer to the goal of providing true equality of opportunity for women. Our duty as a federal law enforcement agency is to provide both compensation for victims and future opportunities that put women on a equal footing with men. This proposed settlement does both," said Donna L. Harper, Supervisory Trial Attorney for the U.S. Equal Employment Opportunity Commission in St. Louis.

The settlement announced today also includes the following provisions:

  • Rent-A-Center agrees to fill ten percent of job vacancies in the first 15 months following the settlement with women who were fired because of their sex since the 1998 acquisition of Rent-A-Center, or who were rejected as job applicants because of their sex.
  • Rent-A-Center will set up, publicize and pay for a toll-free number to be used by women job applicants or employees to report discrimination. Human resources professionals hired by Rent-A-Center will answer and respond to these calls. These individuals will be trained in legal and practical requirements of equal employment opportunity and nondiscrimination.
  • Rent-A-Center will provide quarterly reports for four years that include: descriptions of new employment policies and training programs the company implements; descriptions of any sex discrimination complaints for job applicants or employees; and statistical information by gender regarding hiring, promotion and termination of employees.
  • Rent-A-Center will create a Human Resources department with an experienced human resources vice president who will report directly to Rent-A-Center CEO Mark Speese or President Mitch Fadel. The vice president will enjoy the full support of the company, including senior corporate management, and will be given the resources necessary to develop, implement and monitor policies that ensure equal employment opportunity for women job applicants and employees.
  • Rent-A-Center will publicize its desire to recruit qualified and interested women for jobs in its stores and for promotion into all jobs at all levels.
  • Rent-A-Center will hire and retain a neutral, agreed-upon, qualified, third-party consultant who will serve as a resource the human resources department and an ombudsman to employees and will consult on Rent-A-Center's new employment policies, which will include written qualifications for hiring and promotion.
  • Rent-A-Center will produce and show a videotape featuring CEO Mark Speese and President Mitch Fadel that spells out the company's commitment to nondiscrimination and includes messages that the company welcomes women, values their contributions and will ensure that women are on a level playing field for jobs and promotions. Speese and Fadel will indicate that they recognize that there have been allegations of sex discrimination at Rent-A-Center, that they do not approve of discriminatory conduct based on sex, and that the company will not tolerate such conduct. They will also encourage employees to report sex discrimination. A court-appointed Special Master, who is compensated by the company, will decide disputes regarding sex discrimination.
  • Rent-A-Center will seek qualified women to serve on its currently all-male Board of Directors.
  • Rent-A-Center will develop effective equal employment opportunity training programs for all employees at all levels. These trainings will include, but not be limited to, presentations at annual meetings.
  • Rent-A-Center will notify in writing all women job applicants who were rejected since August 2000 of the settlement of the case, encouraging them to respond if they wish to work for the company.

The Court will determine attorneys' fees and costs to be paid out of the settlement fund, and the way in which the class members will receive their portion of the settlement.