Category Archives: Discrimination

Feds Increase Enforcement Against Employers

Discrimination

The Bush administration made significant changes in the laws affecting employers, most significantly to the Americans with Disabilities Act, which now treats almost every employee as disabled and provides enormous protection from discrimination to employees. I’ve written before about the laws that were changed during the Bush years and what employers should do to protect themselves from missteps. (Click here for that article).

The Obama administration has not yet passed as many significant pieces of legislation in the area of employment law, other than the Lilly Ledbetter Fair Pay Act. However, the new president has put a much greater emphasis on enforcing the laws that are already on the books. Employers can no longer expect an understanding and cooperative investigator when the Department of Labor, the EEOC, the immigration service or another federal agency comes to call on your business.

President Obama’s executive branch, which is charged with enforcement of the existing employment laws, is pouring money and personnel into enforcing laws that protect employees. For example, the administration’s budget for the Department of Labor included a $104.5 billion increase, some of which the Secretary of Labor explained would be used to hire 500 additional full-time enforcement personnel in the areas of worker safety and wage and hour investigations. In Amarillo, that means that the number of investigators has doubled from one to two local field officers auditing your pay practices for overtime and minimum wage violations.

After Congress appropriated an extra $15 million to the Equal Employment Opportunity Commission in March 2009, the EEOC began actively filing many more cases against employers. In September 2009 alone, the EEOC filed 90 cases, with 22% of those filed against Texas employers. These 90 cases in one month should be compared to the 325 cases that the Bush administration’s EEOC filed in all of fiscal year 2008. The EEOC did not back off in October 2009, continuing to file multiple suits in Texas and nationwide against employers accused of sexual harassment, disability discrimination, age discrimination and other violations of federal employment law.

Other agencies are also beefing up their enforcement efforts. As far as worker safety is concerned, OSHA is conducting comprehensive safety inspections for nearly 4000 high-hazard worksites, including nursing homes, animal processing facilities and manufacturing plants. The Department of Justice is hiring more than 50 new civil rights attorneys to prosecute violations of criminal civil rights statutes.

Finally, U.S. Immigration and Customs Enforcement (ICE) announced on July 1 that it issued notices of inspection to 652 businesses nationwide, beginning the involuntary inspection and auditing of those companies’ hiring records. The purpose was to determine whether the businesses are complying with the immigration laws, particularly the requirement that companies have an I-9 employment eligibility form completed on each employee and that the documentation used by the employee reasonably appears genuine. ICE recently announced that this effort revealed that 16% of the I-9s reviewed were suspect, which could lead to civil penalties.

On November 19, another 1000 businesses were notified that they would be audited by ICE. These businesses were selected because they had a connection to public safety and national security.

How should you react as an employer to all of these upgraded enforcement efforts by the federal government? You must pay special attention to all of your employment practices to eliminate any liability. This attention should be focused on your pay practices (to avoid overtime and minimum wage violations), your hiring practices (particularly accurate completion of the I-9 forms), your supervisory practices (to eliminate illegal discrimination of any kind), your medical and leave policies (to prevent FMLA and ADA claims), and most importantly, your firing practices, because more than half of all federal employment law claims occur because of or after the employee is terminated.

Taos Hotel Owner Provides Lessons in What Not To Do

Discrimination

The Associated Press published a story on October 26, 2009, that confirmed that racism is still alive and well in the United States and there is still a need for the workplace discrimination laws.

It seems that Larry Whitten bought a dilapidated hotel in Taos, New Mexico and quickly discriminated against his employees and enraged the town of Taos. So here is an object lesson in what not to do as an employer:

  • Whitten, described as a Texan who last lived in Abilene, met with his new employees and says they were hostile. So he banned the speaking of Spanish in his presence because he was paranoid that they might start talking about him and he wouldn’t be able to understand what they were saying. So he enforced a type of English-only workplace rule, which is often one of the first red flags of discrimination that the Equal Employment Opportunity Commission looks for when investigating racial discrimination in the workplace.
  • Then Whitten told some employees with “Hispanic-sounding” first names that they would have to Anglicize their names while at work. So “Marcos” would have to be “Mark” to satisfy Whitten’s deluded belief that hotel guests would otherwise find their names difficult to understand or pronounce. Whitten’s defense? “It has nothing to do with racism. I’m not doing it for any reason other than the satisfaction of my guests, because people calling from all over America don’t know the Spanish accents or the Spanish culture or Spanish anything,” Whitten said. I don’t know what century Whitten is living in, but according to the United States Census Bureau, Hispanics are projected to make up 15.5% of the nation’s population by next year’s census. Spanish names, language and culture are certainly not unfamiliar to Americans. In New Mexico, Hispanics make up more than 40% of the population and in Taos, Hispanics are the majority. Just doing a little people-watching while Whitten was visiting Taos should have clued Whitten into the fact that a little more racial sensitivity was going to be required in his new workplace.
  • One of Whitten’s fired employees, Martin Gutierrez, summed up the racial insult from the employees’ perspective: “I don’t have to change my name and language or heritage. I’m professional the way I am.” That’s the point that Whitten obviously missed somewhere in his 63 years. He wasn’t judging his employees on their professionalism, their performance or their customer service abilities. He was making employment decisions based solely on his stereotypical beliefs about race. It is classic racial discrimination to assume you know something about an individual’s merits, motivations or abilities when all you really know about that employee is the color of his skin or the sound of his accent.
  • Whitten fell into a trap by believing that providing what he perceived his customers wanted would be a good excuse for his racist decisions. However, the ignorance or racism of your customers, if it even existis, cannot prevent an employer’s liability for violating the discrimination laws in the workplace. If Whitten’s hotel guests had preferred only good-looking female employees or only energetic, young employees under 40, would he have violated the gender and age discrimination laws also? Maybe he would have, but if you are an employer, don’t follow his example.

Relativity in the Workplace

Discrimination, Management,

There is an old Hollywood story that warns of family-run businesses:

Despite their joint ownership (with Albert and Sam) of Warner Brothers studios, little love was lost between Jack and Harry Warner (who once chased Jack around the Warner Brothers lot brandishing a lead pipe, threatening to bludgeon him).

Albert Einstein was given a tour of the Warner studios. “This is the great Professor Albert Einstein,” an executive declared by way of introduction to Jack Warner. “He invented the theory of relativity.”

Warner suddenly perked up. “Well, Professor, I have proved a theory of relatives, too,” he remarked.

“Really?” Einstein replied.

“Yes,” Warner declared. “Don’t hire them!”

In my law practice, I often advise businesses in which several of the owner’s family members are employed. While many families are able to successfully avoid stepping on the landmines that are planted just below the surface of family businesses, others seem to blow up either the family or the company by forgetting to follow a few simple principles to avoid the explosives:

  • Make sure your family members are qualified to work in the role they are fulfilling in the company. I know of a successful entrepreneurial husband who wasn’t interested in worrying about the day-to-day tax, employment, accounting and management details of his business. He was a salesman and a very good one. So he left all those other details to his wife. She had no MBA, no training and no experience with the technical and financial aspects of running a business. Their business eventually suffered several large setbacks because neither spouse was qualified to manage the niggling but necessary details with which every business has to deal. The moral: either hire qualified non-family members to do the jobs which you and yours cannot perform, or require immediate and extensive training for any family member whom you expect to perform unfamiliar job duties.
  • Don’t discriminate between family and non-family members. If you have a policy manual that prevents all employee from smoking in the building, prohibits the use of alcohol while on duty or pornography on the company computers or requires all employees to show up on time, do not allow family members to break these rules. In fact, in my experience, the family members should meet even higher standards to set a good example and because they are always under more scrutiny by employees to determine whether there is a double standard applied.
  • Be careful about practicing your family’s faith in the workplace. I never advise an employer to cut out all references to faith in a business, particularly since following the tenets of your faith can create a much more ethical and wholesome workplace. However, the more family members or others of the same faith you have working in your business, the greater the possibility that applicants or current employees will feel like they have to pass a faith test to work in your business. This would of course be discriminatory, so you will have to be even more diligent about enforcing your equal employment opportunity policies, hiring employees of varying faiths, and making disciplinary decisions without regard to an employee’s beliefs.
  • Watch out for apparent authority problems. In Texas, those with apparent authority to speak for the company can bind the company to contacts and get the company in legal hot water for employment decisions. If it is well-known to your vendors and employees that your daughter is working at the company and is being groomed to one day take over the business, don’t be surprised if she is treated legally as having authority to make all decisions for the company, even if, as the owner, you don’t believe she is experienced or mature enough yet to actually make those decisions.
  • Family dysfunction can really cripple your business. If your son and daughter-in-law both work at the business, what will happen if their marriage starts to fall apart and they eventually divorce? Will you automatically fire your soon to be ex-daughter-in-law? Could this create a sexual discrimination issue? Could she make a claim in the divorce for part of the ownership of the business as community property? Those business owners who plan for the worst and hope for the best address these kinds of issues long before problems arise by requiring buy/sell contracts, pre-nuptial agreements and employment contracts with family members.

Keep An Employee Disciplinary Log

Discrimination,

In the May 2009 San Antonio appeals case of Cantu v. Frito-Lay, Inc., the employer beat a discrimination charge by a former employee because the company kept good records of the kinds of disciplinary action applied to employee misconduct and the reasons such actions were taken.

I often advise employers to keep a running log of each time the company issues a written warning, a suspension or a termination so that it is clear whether employees are being treated equally for similar misbehaviors. The Cantu case provides a good example of the importance of that information.

Kirk Cantu worked as a route salesman for Frito-Lay. He stocked bags of chips in HEB grocery stores. He was seen by a store employee tampering with the “sell by” dates on bags of chips that were later found to be stale. He was banned from servicing any HEB stores at the insistence of HEB, which led to his termination from Frito-Lay.

Cantu sued for gender discrimination, comparing his situation to that of Sandra Casso, a route salesman for Frito-Lay who serviced one HEB store. Casso was related to the store manager and told the store personnel that the manager was pregnant. The store manager asked that Casso be reassigned to another store, but did not want Casso reprimanded. Frito-Lay allowed Casso to bid on another route rather than terminating her employment.

Cantu claimed that he was treated differently than a similarly-situated female who had also been barred from servicing an HEB account, and therefore argued that he had been discriminated against on the basis of his age and gender (Cantu was 53 and Casso was under 40).

The Texas Supreme Court has previously ruled that to be a “similarly-situated” employee for comparison purposes in discrimination cases, the circumstances must be comparable in all material respects, including similar standards, supervisors and conduct. Therefore, the court said that not only does it have to examine the ultimate disciplinary action (both barred from servicing an account, yet one was fired while the other one wasn’t) but also the underlying circumstances.

In other words, to prove discrimination because of disparate disciplinary measures, the plaintiff has to prove that the misconduct he engaged in was nearly identical to that engaged in by a female that the company retained. Cantu was unable to demonstrate that Casso’s misconduct was nearly as serious as his, and therefore he was unable to demonstrate discrimination.

How does an employer assure that it can successfully defend such cases? By making and keeping very good records of the reasons that each employee was fired (or not fired) for misconduct and then showing the court that the employer has been consistent in applying disciplinary measures across all ages, races, genders, etc.

That requires a good log that each manager can access and review before deciding what disciplinary measures to take in an individual situation. If the log were to show that three people before were fired for lying on an application, then the manager would know that lying on an application is a firing offense.

However if the log showed that only the employees who lied about relevant past employment (by claiming experience they didn’t really have) had been fired, while those who lied about schooling (by claiming they had a high school diploma when they only had a GED) had not, the manager will have direction about which offenses are considered serious firing offenses and which are not as serious.

You can’t rely on all of your managers to know of or remember what disciplinary action was taken with each employee, or even the circumstances surrounding the misconduct. But it is easy enough to create a running log that each of them can access and add to as part of the normal disciplinary process. This simple step could assure a win if the company battles a claim of discrimination.

Popular Culture in the Workplace May Be Inappropriate

Discrimination, Management

Michael’s co-worker liked rap music. He liked it so much that he constantly played it and rapped along. Even though the songs contained the “N-word”. Even though Michael is African American. Even though Michael complained several times over a year’s time to his supervisors that the lyrics he was forced to listen to were offensive.

Because his supervisors didn’t correct the problem, Michael contacted the Equal Employment Opportunity Commission (“EEOC”). The EEOC sued on Michael’s behalf for racial harassment and settled the suit against Michael’s employer last year for $168,000.

In announcing the settlement, the EEOC claimed that it is not in the business of judging anyone’s musical taste, but then made it clear that racially offensive language does not belong in the workplace even when disguised as popular culture. The employer had numerous chances to stop the wanna be rapper from offending his co-worker, but never effectively did so.

This kind of culture clash creates difficulties for employers. While television, movies and music have adopted an “anything goes” attitude, the harassment laws require that almost nothing offensive is ever said in the workplace. Every movie that Judd Apatow (“Knocked Up”, “40-Year-Old Virgin”, etc.) releases lowers the bar a little more on what passes for polite discourse in our society, yet every sexual harassment decision raises the standard for what is acceptable conversation on the job. In the middle of this struggle is the employer, trying to build widgets and make a profit, all while having to monitor every employee’s words and conduct.

Miller Brewing Company tried in 1993 to enforce professionalism by firing a manager named Jerold who repeated the punchline of a “Seinfeld” episode to a female coworker. In the episode, Jerry Seinfeld forgot the name of a girl, but remembered that her name rhymed with a female body part. The joke was that her name was “Dolores”. Jerold’s female co-worker didn’t get the joke, so Jerold found a dictionary and pointed out the definition of the rhyming body part. She complained and Jerold was fired a week later. Even though the company overreacted slightly to this one incident, Miller Brewing probably thought that its professionalism policy had done its job and that was the end of it.

The twist in this story is that Jerold sued Miller Brewing Company and the female coworker saying he was wrongfully terminated. The jury found that the woman was not really offended by the Seinfeld joke because she was known to participate in some graphic references herself. The jurors also found that Miller lied about the reasons it really fired Jerold. Jerold was awarded more than $20 million, although he never saw a dime of that money since an appeals court overturned the damages award.

In another music case, the Vail Corporation did not restrict employees listening to music with profanity or lyrics promoting violence against women, which Lisa said offended her. Stupidly, the company did tell Lisa, a Christian employee, that she could not listen to Christian music while on duty because it might offend other employees. The EEOC claimed that the employer also failed to accommodate Lisa’s religious beliefs in some scheduling requests and sexually harassed her by letting managers tell sexual jokes and make graphic comments in the workplace. The Vail Corporation paid $80,000 to settle that religious and sexual discrimination suit.

So do you as an employer have to police your workplace to rid it of all references to popular culture? Good luck with that. Realistically, there are some steps you can take to assure that professionalism reigns in your company:

  • Have clear, written policies expressing the company’s prohibition of racial, sexual, religious and other slurs and harassment, as well as a detailed procedure that your employees can employ to complain if they are offended. Enforce the policy with progressive discipline before any situation gets out of control.
  • Train your employees. So many young people (and some older ones) entering the job market are completely clueless about what “appropriate” or “professional” behavior and conversation actually look like. Yes, their parents and their schools failed them. But now they are your problem and you are going to have to be the one to educate them.
  • Take complaints seriously. Michael’s concern about hearing the “N-word” frequently in his co-worker’s musical selections should not have taken a year to be resolved. Even if you think your employee is being overly sensitive, investigate the complaints objectively and promptly.
  • Set a good example yourself. If dirty jokes, racial epithets or religious slurs ever sneak into your conversations, you can be sure that your employees are watching and taking note. Why should they strive to be professional and appropriate if you don’t bother to do so yourself?

The Next Protected Class: Caregivers

Discrimination

Since 1964, federal laws have made it illegal for an employer to discriminate in employment on the basis of race, national origin, color, ethnicity, religion and gender. These are known as “protected classes” of employees–the ones that you as an employer must carefully handle when it comes to hiring, promoting, compensating and firing.

Since the Civil Rights Act of 1964, the list of protected classes has increased to include age, pregnancy, disability, sexual and other harassment, veteran’s status, and even genetic information. Contrary to popular belief, sexual orientation is not a protected class under federal or Texas law. Also, there is no municipal ordinance in the Texas Panhandle protecting an employee on the basis of his sexual orientation.

The next category of protected employees that I expect to see is the category of “caregivers”. This no longer means just protecting women who have small children at home. The definition of caregiver includes those who also have to care for elderly parents or disabled adult children.

In April 2009, the Equal Employment Opportunity Commission (“EEOC”) released a set of guidelines to “help” employers eliminate possible discrimination against caregivers, under the guise of eliminating sexual discrimination, since caregivers are overwhelmingly likely to be women. A disability discrimination claim might also be used by a caregiving employee. The Family and Medical Leave Act has already been expanded to provide 26 weeks of unpaid leave to those employees who must care for a wounded military family member.

Understand that no law has been passed by Congress specifically prohibiting employers from discriminating against caregivers. There is no state law protecting caregivers. This is simply the EEOC’s way of coming in the back door to try to create a new protected class of employees who can sue their employers. The EEOC is urging employers to voluntarily adopt best practices for dealing with employees with caregiving responsiblities, such as flex-time policies or sick leave practices that cover not only the employee but those for whom the employee cares.

Since the EEOC’s guidelines are not statutory requirements, you don’t have to change anything in the way you are providing time off or flexibility to your employees right now. But keep a close eye on this legal area of caregivers as a protected class. I predict that in five years, you will have to reasonably accommodate caregivers just like you would the disabled.

Are there any proactive steps you can take now to prepare for this inevitable change? If you are updating your employment policies, I really like a “personal days” policy or “Paid Time Off” policy rather than days off labeled as vacation and sick leave. If you allow your employees to accrue 1-2 days per month in undesignated time off that can be used for vacations, sick leave, children’s school activities, elderly parent’s doctor’s appointments, funerals, and other personal issues, your employees already have the flexibility necessary to be caregivers and good employees.

Discrimination Filings Increase Dramatically

Discrimination, Documentation

You might think that by now all employers are careful and correct in their hiring and firing decisions, leading to a decrease in discrimination suits filed by employees and former employees, particularly since the Civil Rights Act has been around for 45 years. You would be wrong.

In 2007, the Equal Employment Opportunity Commission (“EEOC”) saw a 9% increase in the filing of discrimination claims based on race, gender, age, disability, etc. If that weren’t dramatic enough, in fiscal year 2008, the EEOC saw a 15.2% increase over 2007. And that was before the economy hit rock bottom and the  nationwide unemployment rate rose to its current rate of 8.5%. I think it is a safe bet to expect the charges filed with the EEOC in 2009 to increase even more.

What should these statistics say to you as a business owner or manager? They should tell you that you cannot afford to make mistakes in your employee hiring, compensation, evaluation, discipline and termination practices that could be interpreted as discriminatory. Don’t assume that you know what you are doing. Get an experienced HR expert or employment lawyer to help you review your policies and practices.

What should you be reviewing to assure that you have reduced your exposure to an employee lawsuit:

  • Documentation: I can’t say it enough in this blog–if it isn’t written down, it didn’t happen as far as the EEOC or a jury is concerned. Do you discriminate on the basis of race, religion, disability, national origin, age, etc.? You do unless you have a written policy stating that you don’t and you have documents supporting each employment decision you have made and showing that it was made for nondiscriminatory reasons such as performance deficiencies.
  • Written Policies: I still get questions about whether you need to have an extensive written policy manual that you provide to your employees. My final answer: YES, you need written policies! Lots of them! Every governmental agency, whether it is the Texas Workforce Commission investigating an unemployment claim, OSHA investigating a workplace injury or the EEOC investigating a discrimination charge, will first ask for your relevant written policies. Without these, the odds that the governmental agency will make a finding beneficial to your business are pretty close to zero.
  • Layoffs: The decisions you make about which employees to lay off in poor economic times cannot be explained simply by the financial well-being of the business. You won’t be questioned about why you had to lay off 20 employees, you’ll be questioned about why you picked the specific 20 that you picked. If you let your poor performers go, you better have documentation supporting the poor performance of each member of that group, as well as documents showing the outstanding performance of those that you retained. Layoff time is not the time to cherry pick the employees with whom you have the most in common or feel most comfortable, because it is almost a given that you will be explaining your choices to a governmental investigator or a jury at a later time.
  • Retaliatory actions: If someone cooperates with a governmental investigation or files a discrimination claim, you should not fire that employee any time soon thereafter unless you have rock solid documentation of a serious disciplinary violation that employee committed after the claim or the cooperation. Why? Because every claim filed with the EEOC is subject to a retaliation claim. Frequently, an employee who says she was discriminated against can be proved wrong, but if you fired her soon after she made her complaint, you will probably will lose the retaliation claim even as you win the discrimination suit. This would be a very hollow and expensive discrimination “victory”.

Accommodating Mental Disabilities

Discrimination

One of the inevitable problems that the Americans with Disabilities Act Amendments Act (ADAAA), which went into effect January 1, 2009, will cause employers will be the difficulty figuring out how to treat every disabled employee on a case by case basis while all other discrimination laws demand that you treat every one equally. That problem is exacerbated when the employer is trying its best to reasonably accommodate an employee or applicant with a mental impairment.

Let’s look at hypothetical situation: Your newest sales person, Anne, is a 25-year-old, high energy extrovert. She is great when sent out to call on customers. But Anne’s paperwork is a mess and her lack of time management drives you crazy. During organizational meetings, she continuously bounces her left leg and clicks her pen. Everyone on the sales team can pick up on her impatience with any planning process.

Despite Anne’s sales ability, you are about to decide that she is not the right fit for your organization, when Anne drops into a casual conversation the fact that she was diagnosed with Attention Deficit Hyperactivity Disorder (ADHD) when she was in middle school and has been off and on Ritalin ever since. This is not an uncommon situation, since 5.2 percent of the working adult population in the United States has ADHD, according to the World Health Organization.

Firing Anne outright for lack of organizational ability would be a mistake, now that you are aware of the disability. Continue reading Accommodating Mental Disabilities →

Cupid at Work? Bah humbug!

Discrimination, Forms and Policies, Management

Reuters published a story today about a CareerBuilders.com survey on workplace romances. Just in time for Valentine’s Day, 40% of American workers admit that they have dated a coworker. Another 10% say there is a coworker they would like to date. Interestingly only 5% of women want to date a coworker while 14% of men do. Can someone say “hostile environment”?

It gets worse: of those who dated a co-worker in the last year, a third of those relationships involved a coworker who was held a more senior position, including 42% that dated their boss. Can you say “quid pro quo sexual harassment”?

I know I should be all starry-eyed about all the wonderful sparks of romance lighting up American workplaces. But my 22 years of law practice always make me fast-forward to the part where the flames of love die and and out of the embers come the EEOC claims.

Workplace romances are fraught with sexual harassment and retaliation risks. If coworkers date and then break up, the gossip, name-calling, sexual jokes and scorn can easily be twisted into a claim that the workplace has become a hostile environment based on gender.

If a boss dates a subordinate, it gets even messier. The claim can become quid pro quo (loosely translated “this for that”), meaning that the subordinate may say that she was passed over for a raise or promotion or even fired because she wouldn’t give the boss what he used to get and still wants. Quid pro quo cases involving a tangible job detriment, such as a demotion, are the worst kinds of sexual harassment cases for an employer to try to defend.

Many employers are hesitant to get involved in their workers “private” lives. If it is developing in your workplace, it is hardly private. You may need a written policy to establish clear boundaries between business and personal interactions. It can include:

  • Instruction to keep interactions at work professional (no PDA, no long personal exchanges);
  • Requirement of prompt disclosure of a developing relationship, particularly if it involves a supervisor;
  • Removal of management authority from anyone over an employee involved in a personal relationship;
  • Requirement that the dating couple work with management to find an acceptable solution to any problems that arise, such as complaints of favoritism;
  • Requirement to accept transfers, changes in duties, or even voluntary termination of the more senior party if other measures don’t prevent or resolve problems.
  • Requirement that the end of any such relationship be reported to human resources so that future actions can be scrutinized for retaliation or harassment.

Sort of takes all the fun out of the romance, doesn’t it? I feel like Scrooge at Christmas, but I’ve seen too many of these relationships go bad and then the company has to pay the price. Better to nip it in the bud, red rosebud, that is, since ’tis the season for overpriced, underdeveloped blooms!

Training Slashed Even As Employees File Lawsuits

Discrimination, Management, Training,

One of the ironies of recession is that businesses tend to cut back their training of their employees at the same time that layoffs are spawning the filing of higher numbers of employee lawsuits. This is happening again during the present deepening economic crisis. Unfortunately, this is one of those situations of businesses “cutting off their noses to spite their faces.” (Do people still say that or am I showing my age?).

During 2008, studies show that average training expenditures in U.S. businesses decreased 11%. The studies don’t pinpoint which types of training, i.e. safety, skills or sexual harassment prevention, are being cut, but I can guess. Few companies understand the incredible effectiveness of providing employment law training to defeating expensive and time-consuming litigation. Therefore, if they ever offered training to their supervisors on avoiding discrimination or to their staffs on recognizing and preventing harassment or violence, they probably will slash that expense this year.

At the same time that the finance department is telling their bosses that the training budget has to go, employees are being terminated in record numbers. The national unemployment rate for January, which will be released tomorrow, will probably be around 7.5%, a 17-year high.*

And what do employees do after they are fired? They look for someone to blame, which in many cases will be the company that fired them. So they file unemployment claims, discrimination complaints, and lawsuits. During the fiscal year 2008, the Equal Employment Opportunity Commission already experienced a 15.2% annual increase in charges of discrimination and retaliation filed. Just wait until FY 2009.

I can already tell from my own law practice that even in the Texas Panhandle, which has been unusually sheltered from the current economic storm, employee complaints and lawsuits are increasing. Many of my clients are starting to face the investigative powers of the EEOC or the Texas Workforce Commission’s Civil Rights Division. Many of those charges will turn into lawsuits alleging discrimination and retaliation.

If you are regular reader of this blog, you know I always advocate written policies and employee training as your first line of defense against an employee lawsuit. If you start cutting your budget for those things, you may see short-term financial relief, but in the long run you are leaving your company very vulnerable to very costly employment lawsuits.

*Note from February 6, 2009: As it turned out today, the national unemployment figure was even higher: 7.6% for January 2009. That means that almost 600,000 jobs were lost in January. That is the worst showing for number of job losses since 1974. In all, 3.6 million Americans have lost their jobs since this recession started 13 months ago.