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Are Retailers Crossing the Line With Employee Databases?

Written by George Anderson

It's long been known that much of the theft at retail is an inside job. Employees, whether acting alone or as part of organized retail crime, have cost the industry billions. In fact, based on National Retail Federation (NRF) figures, employees were responsible for 43.9 percent of all missing merchandise in 2011.

To help reduce future losses, retailers have provided information to create databases shared by employers about workers accused of engaging in theft.

While the creation of such databases are perfectly legal and are intended to keep dishonest people out of the retail workforce, there are concerns that insufficient or misleading data may be preventing people who should be getting jobs from getting them.

A New York Times article reported on the case of Keesha Goode, a clerk at Forman Mills in 2008. Ms. Goode said she was dismissed from her job for "not reporting on a former employee who was stealing merchandise, but I did not steal anything myself."

Ms. Goode, who signed an admission statement, said she only did so after being convinced she would go to jail if she didn't. Ms. Goode was not aware that her name would go into a database that would keep her from getting future jobs in retailing by signing the statement. It was only after being turned down for a job at Dollar General that she learned about her history in a database maintained by LexisNexis.

"We're not talking about a criminal record, which either is there or is not there — it's an admission statement which is being provided by an employer," Irv Ackelsberg, a lawyer at Langer, Grogan & Diver who represents Ms. Goode, told the Times.

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