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”.