Chattanooga-based Covenant pays fine over hiring practices for non-U.S. citizens

Justice Department says trucking company illegally discriminated against immigrant applicants

Staff photo / Truckers are seen at Covenant Transport in 2018 in Chattanooga.
Staff photo / Truckers are seen at Covenant Transport in 2018 in Chattanooga.

Chattanooga's biggest locally based trucking company has agreed to pay a civil fine and change its hiring procedures for non-U.S. citizens after the U.S. Department of Justice claimed the company was illegally requiring job applicants who are not American citizens to show their permanent resident cards to get hired.

Covenant Logistics and its subsidiary, Transport Management Services LLC, will pay a penalty of $700,000 and alter their screening processes to resolve the government complaint even though Covenant said no one was ever denied a job because of its previous practices.

"Employers cannot discriminate against non-U.S. citizens by demanding specific or unnecessary documents from them to prove their permission to work," Assistant Attorney General Kristen Clarke said in an announcement of the settlement with Covenant. "The Justice Department is committed to ensuring compliance with our federal civil rights laws so that non-U.S. citizens with permission to work can contribute their talents to our workforce."

Clarke said the department's investigation found that from January 2020 through at least August 2022, Covenant and Transport routinely discriminated against non-U.S. citizens by requiring lawful permanent residents to show their permanent resident cards (known as green cards) and by requiring other non-U.S. citizens to show documents related to their immigration status.

 

In a statement, the Department of Justice said federal law allows workers to choose which valid, legally acceptable documentation to present to demonstrate their identity and permission to work, regardless of their citizenship status.

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Under federal Immigrant and Employee Rights laws, Clarke said "employers of any size are not allowed to demand more or different documents than necessary, request specific documents or reject reasonably genuinely-looking documents because of a worker's citizenship, immigration status or national origin."

In a six-page agreement signed last week by Covenant and inked by Department of Justice officials Monday, the federal government said its investigation found "reasonable cause to believe" Covenant "engaged in a pattern of unfair documentary practices." But the agreement also said Covenant denied it discriminated against any individual due to its procedures.

Tripp Grant, chief financial officer for Covenant, said in a statement Tuesday that Covenant "fully cooperated with the Department of Justice's investigation" and agreed to the settlement to avoid a potentially even more expensive battle with the government.

"While we disagree with the DOJ's assessment of the company's practices, we reached this settlement to avoid costly and time-consuming litigation despite the DOJ not finding a single actual instance in which an employee was terminated or was refused employment related to our employment verification practices," Grant said in an emailed statement to the Chattanooga Times Free Press. "Covenant is committed to maintaining an environment in which it does not discriminate against permanent residents or others."

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The agreement resolves the department's determination that the company violated the anti-discrimination provision of the Immigration and Nationality Act by routinely discriminating against non-U.S. citizen workers when checking their permission to work in the United States.

Under the agreement, Covenant and Transport agreed to also train their employees on federal anti-discrimination requirements, revise their employment policies and be subject to monitoring by federal regulators. Covenant will be required to post an English and Spanish version of posters from the Immigrant and Employee Rights section of the Department of Justice on "If You Have the Right to Work."

In a news release on its agreement with Covenant Logistics, the Department of Justice said that many non-U.S. citizens, including lawful permanent residents, are eligible for several of the same types of documents to prove their permission to work as U.S. citizens such as a state ID or driver's license or an unrestricted Social Security card.

Covenant Logistics, formerly Covenant Transport, was founded by David Parker in Chattanooga in 1986 and has since grown to become the second-biggest long-haul team-driver trucking company in the nation. Last year, company revenues topped $1 billion for the first time.

Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340.