The Advantage

January 2004

Testing for Disparate Impact on Negative Employment Actions

More information is available in our best selling book, Secrets of Affirmative Action Compliance, now in its 6th Edition. If you would like to learn more or purchase a copy of the book for your library, go to AAP Book

No Job (or Individual) is Safe from Discrimination Charges

It has been a number of years since Judge Clarence Thomas was first nominated to the Supreme Court by the first President Bush. It has been just about as long since the never-to-be-forgotten Senate confirmation hearings broadcast allegations of sexual harassment against Judge Thomas.

Whether you believe Judge Thomas, or his accuser, Professor Anita Hill, you must conclude that such accusations can touch any supervisor.

How can you defend yourself against such claims of discrimination? How can you protect your business and personal finances from devastation by judgments which may be made against you due to discrimination? The answer to both questions is this: Make your employment-related decisions based only on job-related information, document your decisions and reasons, and conduct yourself in a way that will reduce the opportunity for accusations of wrongdoing.

Step 1: Have written job descriptions for all jobs in your business. If you have more than one person doing the same work, you only need one job description for the group. Now is a particularly good time to review job descriptions because we are coming up on a new year and you can start "fresh" in many ways. Remember, the Americans with Disabilities Act requires that we provide accommodations to both applicants and employees if they can perform the essential functions of the job with or without that accommodation. How will you know the essential functions of the job without having a job description? Here quickly is a list of what your job descriptions should contain: List major duties or responsibilities of the job. Identify the percentage of time an incumbent will spend on each responsibility. Be sure the total is 100%. Under each responsibility, list the key tasks to be performed. (Keep your list to three or four items for each responsibility.) State the amount of education and experience that is required by the job. Specify the skills required rather than years of schooling. e.g.; basic math needed to compute sales record information; basic English skills needed to prepare reports, read customer orders, and converse with customers on the telephone. Identify the influence or control the job will have over company assets. e.g.; use of company vehicle, approval authority for XXX dollars, control of petty cash funds, etc. Identify the physical and mental requirements of the job. e.g.; Sits for long periods; carries boxes weighing XX pounds; converses with customers about sizes, shapes and costs of various products. Abiding by employer policies is part of everyone’s job requirement, and a condition of continued employment. You do not have to write "abiding by employer policies" into every job description as a responsibility unless you choose to do so.

Step 2: Make your employment-related decisions based only on the relationship of employee performance (or qualifications for performance) to the job requirements. Pay increases should be related to job performance. Promotions should be related to job performance. Work assignments should be related to job performance. And, hiring and firing should be related to job performance. Inappropriate reasons for taking employment-related action against an employee might include: Color of hair, style of shoes, accent, or any of the class identifications protected under federal or state equal opportunity laws. Typically they include: Age, sex, race, color, national origin, religion, pregnancy, and disability. Some states protect marital status, medical condition, political affiliation and sexual preference. Be sure you know the laws in your own state.

Step 3: Document each of your employment decisions and the reasoning you used to arrive at them. Your documentation can be short and simple. For example, "Gave Pat a raise because of performance results during the past year." Remember, too, that you must be able to show employee performance reviews if you refer to them. Always assume someone will challenge your decisions and assure yourself that your documentation will explain your reasoning.

Step 4: Personally behave in ways that will protect you against charges of harassment. Normal professional justification aside, your relationships will be more positive if you keep your personal life separate from your business life. The message our courts have been sending employers is simple: People should be able to do their jobs and be judged only on their performance of those job functions.

No one can guarantee you won’t be accused of discrimination. If you have managed well, however, you will be able to demonstrate that the accusation is unjustified. According to a five year study of discrimination claims in Ohio, as reported in the October 1991 issue of HR Magazine, discrimination strikes every job from top executive to laborer. Men file more claims in the traditionally male-dominated jobs – executive, administrative and managerial, production, transportation and labor. Women’s claims are predominant in administrative support, traditionally female-dominated jobs, and in four other areas – professional specialty, technicians, sales and service.

Sexual harassment in the workplace continues to generate a great many complaints. Sexual remarks accounted for about one-half of the harassment claims reviewed by the Ohio study. Touching and seeking favors each accounted for about one-fourth of the claims. Harassment in sales jobs occurred at twice the rate as women were represented in these positions. The vast majority of discrimination complaints occurred during the "recruitment/selection" and "termination" phases of the employment relationship.

On the federal level, from 1992 through 2002, the Equal Employment Opportunity Commission (EEOC) processed between 10,532 and 15,889 charges of sexual harassment each year. After all of the media coverage of enormous punitive damage awards during that ten year time, and countless hours of corporate training on the subject, reasonable cause findings in EEOC sexual harassment charges jumped from 3.8% of cases in 1992 to 9.3% in 2002. The result was actually higher (10.7%) in 2001.

Findings of "No Reasonable Cause" also increased during that ten years from 32.8% in 1992 to 47.1% in 2002. Administrative closures fell during that time as well, meaning fewer individuals were asking for a Right-to-Sue letter before the case is fully investigated and a determination made.

The big news, however is in the raw numbers:
In 1992 there were 10,532 charges of sexual harassment filed with the EEOC. Along the way to 14,396 in 2002, there were seven years of more than 15,000 charges per year. The problem of sexual harassment is surfacing more frequently in the form of EEOC complaints. And, remember, there are many state Fair Employment Practices Commissions around the country.

Preventing complaints can be achieved through proper implementation of policies and decision making processes. Encourage your employees to let you know when problems are occurring. When claims are filed with an external agency, you risk becoming defensive. In every case of external complaint filing, you lose control over processing the complaint. As a matter of fact, once a charge is filed and you are notified, you may not legally talk with the employee about that issue, except through the case investigator at the agency. Resolving complaints becomes very difficult when you are forced to route all communications through a third party.

Successful business managers and HR professionals have at the top of their priority list the prevention of employment discrimination complaints. The rest will likely not be around much longer anyway.

Team Building: Reaching for the Brass Ring?

Perhaps, you can remember riding on the classical merry-go-‘round as a youngster, and stretching to reach the brass ring every revolution. If you got one, you were entitled to another ride … free. One hazard of the effort was that you would stretch so far you lost your balance and fell off the creature you were riding.

Building business teams in today’s world is sometimes like that carousel ride and stretch for the brass ring. If you aren’t careful about proper balance, you can get bruised by falling.

That isn’t to say you shouldn’t make the effort. Indeed, few approaches to managing a business can be as successful as a well designed "team approach." It simply requires careful planning and dedicated follow-through.

Teams can be temporary or permanent parts of your business structure. They can be project related or functionally based, such as quality assurance teams. Teams can meet only a few times each year, or work together daily in pursuit of their objectives.

Business teams can offer a growing company decision-making advantages. Groups of employees, organized into teams, can bring a refreshing perspective to problem solving. Teams offer a company the opportunity to tap into all employee resources and avoid the pitfalls of one-sided executive decision making.

Well, if that is the case, why don’t more businesses actively foster team participation in their operations? Teams can be used in small businesses as well as large. So, size of the business doesn’t seem to be an answer to the question. The answer, simply stated, is this: Team building takes a lot of effort. It requires a total commitment of the executive responsible for its success. And, when that happens, the pay off can be remarkable.

If you wish to begin a team-building process in your company, you will need to emphasize:

1. Communication - managers must increase listening and questioning skills, employees must overcome hesitancy to pass along both good and bad news to team members.
2. Planning - defining team objectives is essential for members to understand the purpose of their activities. Define individual roles clearly to avoid misunderstandings about responsibilities and authority. Assure efficiency of team operations by designating schedule deadlines. Many of these can be early products of team effort.
3. Leadership - team leaders guide discussions, help the team set priorities, coordinate activities and develop action plans. They assure each member the opportunity to participate fully.
4. Incentives - reward systems are necessary to provide team members proper compensation for their contributions to the company’s success. Being selected to participate in a team can become a sign of achievement in itself. Sharing in the fruits of the team’s work should be a benefit each member receives.
   Teamwork can be fostered by the following elements:*
   

   Interesting and stimulating work Recognition of accomplishments Experienced and qualified personnel Adequate training Effective leadership Open communications Employee growth potential Strong bonds among team members

   Barriers to team work include:*
   

   Unclear goals and objectives Insufficient resources Interpersonal conflicts Autocratic management Disinterested top executives Job insecurity Poorly established priorities Excessive bureaucracy

   
   * From Business Teams by Thomas Owens, "Small Business Reports," January 1989.
   

   If you are just getting started in the use of teams in your company, consider beginning with "special teams." Usually, these teams are formed for the specific purpose of addressing a given business problem. It might be associated with production quality, customer service, cost reduction, or any other issue. Simply reducing the complexity of some process may be reason enough to institute a special team in your organization.

   Team members can gain a sense of personal involvement and get an opportunity to work on problems that require their unique knowledge and insights. That’s a big advantage for you, the business manager or HR professional. Therefore, careful selection of team members is critical to the team’s success. Use the minimum number of people required to do the job. Those you select should have the knowledge, ability and enthusiasm to contribute effectively on the specific problem the team will face. Participation should be voluntary. Ask for participation, don’t order it.

   If necessary give team members a brief training in effective use of problem-solving, statistical process control, or other techniques for effective group functioning. A small investment of time early on can save a great deal of wasted time caused by communications breakdowns later.

   Identify the executive in your company who will be the team’s contact and "champion." This person will provide the "power" required for actions the team must take. The executive may or may not be a team member. It is important, however, that the team have access to this individual whenever necessary.

   Start slowly in your experimentation with team units. Build your successes one at a time. Convince yourself and your employees that it is possible to catch the brass ring through teamwork. Each success you log will create a greater interest in using the team approach on the next business problem that surfaces.

   

   The Employee Handbook: Low Cost Tool for Big Savings

   
   

   A small San Francisco employer recently wrote a check for $18,000 to cover back pay and fines levied by the California Labor Commissioner. When the check cleared and was returned with his monthly bank statement, he realized that he had nothing positive to show for his expense except the belated wisdom that it could happen to him … and it did.

   His story is similar to many others. He employed a small workforce. Everyone seemed like family. They all got along well most of the time, like family. When work backed up, everyone agreed to help by working overtime. He said he would give them time off later to compensate. He depended on each employee to keep track of the overtime worked. He trusted them … like family.

   The day came when one of his employees and he had a disagreement. He can’t even remember what caused the conversation, but does remember that it ended with her resigning from the company. He recalls thinking at the time it was a severe reaction to such a minor issue.

   A couple of months passed. Then the mail brought him a notice from the Labor Commissioner that a complaint had been filed by his former employee claiming he had failed to pay her for several hundred hours of overtime. He didn’t believe she could have possibly accumulated that much overtime, but he had no work records to support his belief. She had kept track of her extra hours for herself, as he requested, and she took the records with her when she left. Unfortunately, said the notice, the California Labor Code requires overtime worked by people in her job category to be paid time. It does not allow the option of compensating time off at the employer’s discretion.

   He paid the $18,000.

   With a much smaller investment, this employer could have had a customized Employee Handbook for his business that helped him prevent the problem he encountered. And, he could have had something to show for his money besides a canceled check.

   Employee Handbooks are critical to all employers in California who want to avoid the kind of problem this employer encountered. They can help reinforce the employer’s rights under the Employment-at-Will doctrine, explaining to employees that the employment relationship can be ended by either of them for any cause, or for no particular cause. A properly prepared handbook outlines policies of equal treatment, compensation, privacy of information, and freedom from sexual harassment. It also contains details about how employees should maintain work time records, and benefits they are entitled to such as workers’ compensation, state disability insurance and Social Security.

   Most important, perhaps, a carefully prepared Employee Handbook communicates the message that the employer wants to maintain a positive, productive relationship with all employees.

   Can you afford to pass up investing in development of your own Employee Handbook? The risks you accept without one are huge. And … every employer is self-insured against those risks. Employment liability is not something you will find on one of your business insurance policies as a covered risk. In some states it is available as a separate policy with deductibles in the six and seven digit range. If you are like most employers, there is no provision of a "Funded Reserve for Employment Liability" in your financial records. Any loss will most likely come directly from your monthly operating budget.

   Are you ready to write a big check for back pay and penalties like the San Francisco employer we told you about? Think about it as a business decision based on economics. Then consider the value you will gain in employee communications with an Employee Handbook. What will be your choice?

   For more information about development of an Employee Handbook, or review of one you already have, please contact Merit Resource Group at 925-828-4700. Be sure to tell them you were sent by The Management Advantage, Inc.

   

   A Gentle Word on Behalf of Our Business

   When you need help developing your affirmative action program, give us a call. We specialize in AAP development, implementation training and compliance review support for clients all over the country. Find out more about our AAP development service by looking at our sample agreement and other information. You will find it all at http://www.management-advantage.com.

   You wouldn't go to an IRS audit alone. Why think about going into a Department of Labor compliance review without professional support? The stakes are just as high either way.

   We are ready to give you the support you need.

   And while you're at it, think about ordering a copy of our reference and training book on preparing affirmative action plans and managing compliance reviews. You will find it an invaluable resource at a price that just can't be beat.

   Secrets of Affirmative Action Compliance, new 6th edition, contains over 500 pages of the latest and current regulation requirements and practical suggestions for your organization. Includes new Federal Regulations. $99.95 plus $9. shipping/handling and CA sales tax for CA destinations. Credit Card Orders ... Call Toll Free:

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   We can help with your other human resource management needs as well. Think of us the next time you need:

   • Employee Handbooks
   • Management Training in Compliance Issues
   • Affirmative Action Plan Development
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   • Disparate Impact Testing for New Hires, Promotions, Transfers, Terminations
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   • Books, Software or Other Support Materials for HR Professionals
   

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