Pizza 'redlining' accord may have domino effect

Nation's Restaurant News, June 19, 2000 by Milford Prewitt

Safety is driving force for delivery services

But minorities say chains are biased

National pizza chains are center stage -- often playing the villain -- in one of the restaurant industry's most controversial socioeconomic dramas.

The challenge to ensure driver safety while deflecting accusations of bias from minority neighborhoods with high crime is hardly the exclusive travail of Domino's Pizza as all major competitors in the industry's most competitive segment battle for market share against hundreds of regional and local pizza operators.

"We pioneered delivery, and when you come to an area that has high crime or is unsafe, how do you be fair to your drivers and fair to the community?" asked Glenn Mueller, president of 165-store RPM Pizza Inc. of Gulfport, Miss., which is Domino's largest franchisee. "In some places it's a very hard problem to balance."

Mueller's musing on that thorny issue was prompted by this month's agreement between the Justice Department and the nation's largest pizza system over the issue of alleged delivery redlining. Years of complaints from consumers and community groups, charging that Domino's deliberately discriminated against African American neighborhoods and castigated some communities as crime-ridden had triggered a Justice Department investigation.

Averting what potentially could have been a federal lawsuit, Domino's came up with a plan that the Justice Department approved. Its key elements call for the 4,550-unit chain to work more closely with local police departments in verifying criminal activity. The chain also agreed to maintain better relationships with community groups and business owners to assess criminal activity.

But perhaps the thorniest part of the agreement will limit the authority of unit managers, once they have confirmed that certain parts of neighborhoods are dangerous, from restricting deliveries or determining how broadly those restrictions will be. Limitations will be allowed only in specific areas where there is criminal activity. Thus, rather than seal off an entire neighborhood from delivery, perhaps only a block or two would be off-limits. Whatever the restrictions sought by company-store or franchise managers, Domino's corporate safety officials must approve all of them.

"We commend Domino's for promptly and cooperatively addressing concerns raised about its delivery policy," said Bill Lee, the Justice Department's acting assistant attorney general for civil rights. "The new policy ensures that decisions on delivery limitation will be based on the legitimate concern for the safety of Domino's employees and not on the racial composition of a neighborhood."

"I think this agreement just reaffirms that we were already on the right path," Mueller said, referring to the similarity between the new policy and what Domino's said were its longstanding delivery-limitation practices.

Steve Coomes, editor of Pizza Today and spokesman for the National Association of Pizza Operators, said the agreement makes a lot of sense and could be a model for chains everywhere.

"All the Justice Department is saying is that if you can prove that it is dangerous to deliver there, you don't have to go there," Coomes said. "But that means Domino's has to document its fear so to speak. But it's still a good agreement."

However, some critics are not sure and wonder if the Justice Department was too soft on the pizza industry at large.

Chuck Bell, a spokesman for the advocacy group Consumers Union, the Yonkers, N.Y.-based publisher of Consumer Reports, said all of the major pizza chains should have been part of the agreement.

"It's good that they are using an empirical basis rather than assumptions, because when you make assumptions, you immediately get into the discriminatory aspects in all of this," Bell said. "But my problem is that it is only covering one company when it could apply to all of them."

Although the National Association for the Advancement of Colored People was not actively involved in the Justice Department's investigation, nor was it among the complainants, the civil-rights group said drivers and communities have something to gain from the agreement.

"We're glad they worked out a settlement," said NAACP spokesman John White. "But we understand the risks faced by drivers, which is a real danger. But at the same time we would encourage companies not to make blanket redlining decisions that are not based on fact.

"What this agreement says is that if you are going to have some area cut off from your delivery routes and services, it better be based on fact and not perception."

Virtually every major pizza chain at some point in its recent history has grappled with a boycott, a lawsuit, cancellation of contracts or negative press for refusing to deliver to minority neighborhoods considered crime-ridden.

Pizza Hut, for example, ignited a firestorm of condemnation -- and is still suffering the loss of a $170,000 lunchtime delivery contract -- when the Kansas City, Mo., School Board terminated its agreement in 1997 for alleged redlining. In that case a local Pizza Hut store refused to make a delivery for an honor students luncheon at a predominantly black high school in a neighborhood that a computer program identified as dangerous.