Illegal discrimination is the most serious human resources mistake a company can make. The potential financial costs to a company are significant, broad and possibly fatal. While legal fees, back pay, benefits and punitive damages are often exorbitant, damaged morale, negative public relations and industry-wide exposure can all impact the company in very traumatic ways.
Employee discrimination claims filed with the Equal Employment Opportunity Commission (EEOC) rose significantly during the past year. For 2010, the top five most prevalent EEOC claims were: retaliation, race, gender, disability and age discrimination. This marks the first time since 1965 that race discrimination was not the most frequently-filed EEOC claim.
These findings illustrate that discrimination claims are more popular than ever, and more diverse than commonly conceived.
Penalties associated with illegal discrimination typically fall into one of three categories: fines, litigation and lost company revenue. Fines are levied by the federal and/or state government defending the employee alleging discrimination by the company. These often sizable financial fines are intended to punish the company, which has committed the employment discrimination, to such an extent that the company will not repeat the same action in the future.
Litigation expenses are all costs related to a court hearing in which the company defends itself against an employee’s claim of illegal discrimination. Lost company revenue is the third type of penalty a company can experience when confronted with an illegal discrimination claim. Though difficult to quantify, this penalty is the direct result of negative publicity due to the company’s illegal employment practices.
Illegal discrimination can take many forms, obvious as well as subtle, and thus employers must constantly be proactive in eliminating discrimination from their business practices. Here is a list of common venues in which landscapers may demonstrate discrimination.
- Illegal interview questions: Despite the fact that they know better, many landscapers typically ask illegal questions during job interviews. These illegal questions may bias the interviewer’s judgment thereby preventing a qualified protected class applicant from getting a job with the company.
- Sexual harassment: Unfortunately, employees still make sexist comments or demonstrate behaviors that convey sexual harassment. Such comments, undertones or behaviors are discriminatory even if their intent is not to discriminate or harass another employee.
- Inappropriate comments: Landscape employees who make comments about another employee’s age, ethnic group, national origin or disability status, even as a “joke,” put the company in jeopardy of being sued for illegal discrimination.
- Poor recruitment practices: While likely unintentional, many landscaping companies direct their recruitment efforts in a very selective manner, frequently targeting certain types of job applicants. This narrow focus can be perceived as being discriminatory against other protected class members.
These practices can help landscapers minimize exposure to employment discrimination practices and minimize its costly consequences to their bottom line.
- EEO policy. Best-in-class employers have a very strong EEO policy declaring a staunch commitment against all forms of discrimination. This policy is highly visible throughout the company culture (e.g., employee handbook, new employee orientation, employee selection process) and is consistently role modeled by all company executives.
- Human resources audit. Best-in-class companies conduct a rigorous audit each year examining all of their human resources practices (e.g., selection, training, compensation) to ensure they are free from any hint of illegal discrimination.
- Employment practices liability insurance. Best-in-class employers have comprehensive employment practices liability insurance to help protect them legally and financially against any claim of illegal discrimination.
- Arbitration agreements. As part of their employee handbook, best-in-class employers require each employee to sign an arbitration agreement bypassing a costly court trial in favor of presenting a case to an arbitrator, when alleging a claim of illegal discrimination.
The issue of illegal discrimination is very serious, injuring the employee while damaging the employer. Landscapers must be very sensitive to all protected groups, eliminate any form of illegal discrimination throughout their business operations and treat all employees with fairness and respect at all times. Then, and only then, will the threat of illegal discrimination cease to have a costly impact on them.
The author is an industrial psychologist with The Harvest Group, a landscape consulting group. Send him questions at email@example.com.