Can a company vary its prices for individuals based upon their race, gender, or sexual orientation?

Question

With the growth of the technology industry and lack of skilled computer professionals, there's been a rapid rise in the number of for-profit providers of short term courses in various computer science disciplines. Examples include General Assembly, Galvanize, and Maker's Academy, among several others.

Many of these providers offer lower rates to individuals if they are of a certain race, ethnicity, gender, gender identity, or sexual orientation. As a result, the price for the programs could be lower for one person over another just because of a difference in, say, their race. See https://www.coursereport.com/resources/the-definitive-list-of-programming-bootcamp-scholarships

I'm no attorney, but I suppose that such discriminatory pricing is permitted because these companies are considered not to be providing a public accommodation. Moreover, many of these companies claim to scholarships rather than lower tuition. Finally, they claim to have a legitimate reason for offering these scholarships -- to increase certain populations' numbers within the tech field. So this could all be within the law.

But when I consider any of the following made up hypotheticals in other industries, I shudder:

• Kroger automatically gives a 10% discount coupon on vegetables only to Black customers, and not to Hispanics, to increase healthy eating among blacks.
• Apple gives a $100 gift card with purchases of iPhones only to Asian American customers, but not to individuals of other races. Reason offered is to increase wireless connectivity among Asian-American population.
• Buffalo Wild Wings gives white diners, but not anyone else, a $10 gift card for every time they dine at the restaurant. Reason offered is to increase interest and participation in televised sports among white women, whose rates of interest lag those of men of all races.

And now it seems to me that it's grossly unfair to charge two individuals different prices for the same product solely on the basis of race, gender or similar characteristics. So I was wondering if there's anything legally wrong with the tech bootcamps' pricing policies.

Answer 1

Discriminatory pricing is a real thing. See this BuzzFeed video on discriminatory pricing as an example on how men's and women's products cost differently, even if the men's product consumes more raw material yet still costs less. However, it's illegal for hotels to charge different rates for their rooms, or for restaurants to charge unfairly or give preferential treatment; they are "public accommodations" protected under the various Civil Rights Acts.

However, colleges are exempt from current laws, and it's not just tech colleges; even traditional colleges require different SAT scores for entry based on race and/or gender, and also charge different tuition. They are private accommodations and are therefore generally allowed to do this.

For example, you'll have a much harder time getting in to Harvard if you're of a particular race, even if you can afford the tuition, simply because you'll be expected to have a higher SAT score. There was a class action lawsuit in California over this (the students were above 4.0 GPA, yet denied entry based on race), and as a result of law changes afterwards, California institutions can no longer do this. This is not the situation in the rest of the country, as no Federal law yet exists that protects minorities, gender, sexual orientation, etc, in regards to higher education.

Also, sometimes merely proving a gap exists might not be noticeable, as companies are also starting to display pages on their websites based on data-mined information about visitors, possibly including information that would otherwise be discriminatory if it were done in person, and hiding the information from the general public. Discrimination is a difficult beast to tame, and until the law is introduced that all products and services must be offered to all consumers at the same price regardless of gender, race, sexual orientation, etc, businesses will continue to find ways to discriminate in legal ways.