Marketplace revolt: employers beware
Everything is funny, the late Will Rogers once quipped, as long as it's happening to somebody else. In the wake of recent court decisions, any corporation that once believed employment discrimination laws presented a problem to others but not for it is finding little to laugh about these days. Companies of all sizes are discovering that civil rights enforcement in the workplace has become one of the most important legal developments to affect them in two decades.
To top management's alarm, they are awaking to discover that the laws contain real teeth which threaten to take large bites from their corporate treasuries in the form of fat settlements to employees. Every day employers are being jolted as traditional prerogatives to hire, fire, reward, and promote are being eroded by lawsuits set into motion by newly litigious employees.
Antidiscrimination laws have been on the books for years, but a multitude of forces have begun to collide. First, the work force is getting older; and older workers don't want to be moved out to make way for younger employees. Second, there are more female workers. Along with blacks and other minorities, they are better trained and educated, and they're applying for professional and managerial jobs denied them a few years ago. Finally, laws have been expanded upon in the last 20 years by Congress and the courts, while 48 states have tough laws of their own.
As a result, corporations unaware of recent decisions are facing mounting financial liabilities stemming from a long string of lawsuits. It's a clear case of what corporations don't know can really hurt them.
For example, a transportation company, evidently unaware of recent settlements, relied heavily on word-of-mouth hiring for its drivers. The company also had relatively few minority workers. A lawsuit was filed against it. In short order, the company lost in court, had to pay damages, and had to undertake a costly affirmative-action program. The company had failed to know that, while federal statutes were originally enacted to eliminate conscious, systematic discrimination from the workplace, the focus has shifted in the courts to those unsystematic, ad hoc, subjective practices such as word-of-mouth hiring. While free from invidious intent, these practices are nevertheless illegal, and, as the company now knows, very expensive.
Other recent court decisions are equally far-reaching.
* A disgruntled minority worker who fails to be promoted as promised or who is laid off contrary to verbal assurances is a likely winner in a discrimination suit.
* Firing employees, if periodic, written evaluations have not been prepared, may mean a lawsuit or an expensive settlement.
* Companies offering pregnancy coverage for female workers must provide the same coverage for spouses of male employees.
* If male employees can take medical leave without losing seniority, female workers are entitled to maternity leave as is true for disability benefits.
* Despite what the actuarial tables say about women living longer than men, it is illegal to require female workers to contribute more to their employer pension plans or receive lower monthly benefits than men.
A number of strategies are possible for employers to avoid the financial drain of discrimination lawsuits, beginning with written employee evaluation records and an end to word-of-mouth hiring. But personnel policy must first be assigned a higher priority than it has so far in many executive suites. It is time for equal-employment policy to be considered alongside strategic planning, marketing, and financial operations. Then a thorough review of existing practices should be made, with a commitment for periodic review of court decisions and state as well as federal laws.
For large or small businesses, employment discrimination laws are a ticking time bomb that can be defused.