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Case Updates12/11/13Federal Court Grants Final Approval of Class Action Settlement on behalf of Black Managers at Wet Seal Stores 6/17/13Federal Court Conditionally Approves Class Action Settlement on behalf of Black Managers at Clothing Chain Wet Seal 5/09/13Clothing Chain Wet Seal Settles Lawsuit Charging It with Firing African-American Employees
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Economic Justice | Employment Discrimination
LDF's Economic Justice Program has filed a class action lawsuit, Cogdell v. Wet Seal, alleging that top executives at Wet Seal directed senior managers to get rid of African American store management employees for the sake of its “brand image,” and to hire more white employees.
The lawsuit filed in federal court in Orange County, California, alleges that since 2008, the nationwide women’s clothing store chain targeted African-American store managers because they do not fit the “brand image” it sought to project. This policy was adopted and implemented by the highest corporate officials, including the company CEO and Senior Vice President and Vice President of Store Operations. In March 2009, for example, after visiting several stores the Senior Vice President wrote an email to the Vice President of Store Operations and a district manager with her store visit notes. Under the heading, “Global Issues,” she wrote, “Store Teams need diversity — African American dominate — huge issue.” Another senior executive ordered a district manager to “clean the entire store out” after observing numerous African-American employees working there.
Over 20 charges of discrimination have been filed by current and former Wet Seal employees with the U.S. Equal Employment Opportunity Commission (EEOC) against Wet Seal, including a charge filed by a former Regional Director alleging she was fired for promoting an African-American to manage a high-profile store.
Update: On May 8, 2013, Plaintiffs reached a settlement with Wet Seal and filed a motion asking the court to approve the settlement. Wet Seal’s new CEO and Board of Directors have agreed to make numerous changes to address the discrimination charges. Wet Seal also agreed to pay $7.5 million in monetary relief, including damages to current and former African-American managers of at least $5.58 million.
Under the settlement Wet Seal will:
- Pay $5.58 million into a fund for current and past workers affected;
- Track applications to ensure diversity in applications and hiring;
- Expand Wet Seal’s human resources department to better investigate complaints of discrimination;
- Post store management and District Director openings;
- Hire experts to develop updated job-related hiring, promotion, and compensation policies and practices;
- Hire experts to develop performance evaluation tools for store management employees; and
- Ensure that marketing materials include African Americans, of various skin tones, to reflect diversity;
- Maintain a Diversity and Inclusion Council made up of a diverse group of current employees that will advise the company on topics including equal employment in recruiting, hiring, and compensation.
Read more about discrimination in the retail industry here: “Discrimination plagues NYC retail industry,”