In 2015, Target Corporation paid $2.8 million to resolve a finding by the US Equal Employment Opportunity Commission. Three assessments used to screen exempt-level job applicants had disproportionately excluded candidates on the basis of race, sex, and disability. Target could not demonstrate that any of the three assessments was job-related or consistent with business necessity. More than 3,000 applicants were affected. Target discontinued all three tests and agreed not to reinstate them.
Target Corporation is one of the United States' largest retailers, operating over 1,800 stores and employing approximately 300,000 people at the time of the settlement. As a major employer regularly hiring for corporate, professional, and management roles, Target maintained a structured approach to recruitment for exempt-level positions -- those classified above hourly store-level work.
The company's hiring process for these roles included a set of standardised pre-employment assessments, administered before candidates could progress to the interview stage. On the surface, this was a systematic, scalable approach to high-volume professional hiring.
Target used three assessments to screen candidates for exempt-level roles. Two of them produced outcomes that disproportionately excluded applicants on the basis of race and sex. A third assessment was found to constitute a pre-employment medical examination, which the Americans with Disabilities Act prohibits before a conditional offer of employment has been made.
The legal standard under Title VII of the Civil Rights Act is specific: when a selection criterion produces a disparate impact on a protected group, the employer must be able to demonstrate that the criterion is job-related and consistent with business necessity. That demonstration requires evidence -- typically validation studies showing the assessment predicts performance in the specific role at the specific organisation.
Target had no such evidence. The assessments had been embedded in the hiring process, but their connection to actual job performance at Target had never been documented.
"Target had a structured process. What it lacked was documented justification for why that process was lawful."
$2.8 million distributed across more than 3,000 applicants represents an average of approximately $930 per affected person. That figure does not include legal costs, the operational disruption of removing screening tools mid-process, or the cost of establishing compliant replacement procedures.
Not one of the three assessments had been validated against actual job performance at Target. The company was screening thousands of applicants using tools whose predictive value for the specific roles in question had never been measured.
The EEOC did not allege that Target intended to discriminate. The charge was that Target applied selection criteria it could not defend.
Target paid the settlement. It agreed to stop using all three assessments permanently. It agreed to train relevant staff and implement new procedures to ensure future assessments met legal standards before deployment.
The company had, for years, operated a structured screening process that appeared systematic and consistent. The structure was real. What was absent was the documentation layer beneath it: evidence that the criteria applied were job-related, that the outcomes produced were defensible, and that any individual's rejection could be explained by reference to the requirements of the role.
When the EEOC asked "why was this applicant rejected?", the honest answer was: "our assessment scored them lower -- and we cannot tell you why that score is a valid measure of their likely performance."
Target's case is not a story about discrimination. It is a story about the gap between a structured process and a defensible one.
A structured process applies criteria consistently. A defensible process can explain -- per criterion, per applicant -- why each decision was made, why the criteria are job-related, and why the outcome is a reasonable reflection of the requirements.
The specific technology changes. Personality assessments in 2015. AI scoring in 2025. The legal standard does not: any selection criterion that produces a disparate impact must be demonstrably job-related. "The system ranked them lower" has never been a sufficient answer. It is not becoming one.
If a rejected applicant, an employment tribunal, or a regulatory body asks why they were not shortlisted, a hiring team that cannot show documented, per-requirement scoring -- and explain the rationale behind each criterion -- is in the same position Target was in. Structurally exposed. Not through intent. Through the absence of documentation.
The question to ask of every hiring process: if you had to explain this decision in writing, with reference to the role requirements, to the person who was rejected -- could you?
Talent Atrium's candidate scoring tool documents every shortlisting decision against specific role requirements, with a per-requirement explanation for every score. Built for teams that need to be able to answer the question.
US Equal Employment Opportunity Commission. "Target Corporation to Pay $2.8 Million to Resolve EEOC Discrimination Finding." August 24, 2015. eeoc.gov
Fortune. "Target to pay $2.8 million for discriminatory hiring tests." August 24, 2015.
Retail Dive. "Target to pay $2.8M in hiring discrimination settlement." August 25, 2015.
Star Tribune. "Target to pay $2.8M to upper-level applicants in EEOC settlement." August 24, 2015.