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Chapter 03 - The Legal Environment of HRM: Equal Employment Opportunity
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CHAPTER 3
THE LEGAL ENVIRONMENT OF HRM:
EQUAL EMPLOYMENT OPPORTUNITY
CHAPTER OBJECTIVES:
After reading this chapter you should be able to:
1. Explain the legal issues affecting HRM activity and the various laws related to equal
employment opportunity and employment discrimination
2. Identify potential problems in HRM policy and practice as related to equal employment
opportunity laws.
3. Know the importance of judicial interpretation in EEO law.
4. Understand the implications of EEO law in the international context.
5. Describe the future trends related to EEO law and their implications for practice.
Chapter 03 - The Legal Environment of HRM: Equal Employment Opportunity
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CHAPTER 3 - SUMMARY
I. Overview
A. EEO law and regulation has a major impact on the practice of HRM.
B. The potential for litigation has increased as a consequence of increasing workforce
diversity.
C. Employment- related litigation and regulation is increasing.
D. EEO compliance represents good HR practice.
II. Equal Employment Opportunity Law
A. What is Employment Discrimination?
1. Employment decisions or working conditions that are
2. Can apply to:
a. Staffing /Personnel selection
b. Training program opportunities
1. Title VII of 1964 U.S. Civil Rights Act (and subsequent amendments)
2. Age Discrimination in Employment Act (ADEA) of 1967
3. The Americans with Disabilities Act (ADA) of 1990
4. States and many municipalities also have their own fair employment laws
5. Equal Employment Opportunity Commission
i. All claims of discrimination under CRA, ADEA, and ADA must first be filed
1. Direct Expenses related to litigation and costs associated with judgments
2. Damage to the company’s reputation
3. Future outside controls on personnel practices
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© 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
1. File a charge of discrimination within 180 days of the alleged discrimination
2. Offers a mediation process to attempt reconciliation between the parties
3. See Figure 3-3 on page 67
III. Title VII of the Civil Rights Act
A. Prohibits discrimination based on race, sex, religion, color, or national origin.
Applies to employers with more than 15 employees, except
1. Private clubs
2. Religious organizations
3. Places of employment connected to an Indian reservation
B. The EEOC
1. U.S. Equal Employment Opportunity Commission monitors and enforces
compliance with Title VII and other EEO laws
2. Issues guidelines, interpretations and recommendations
3. The EEOC requires submittal of EEO-1 forms (see Figure 3-5).
1. Discrimination based on
a. Seniority systems
b. Veteran's preference rights
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5. How Does An Employer Prove "Job-Relatedness?"
a. Griggs v. Duke Power (1971) – if an employment practice cannot be shown to
be related to job performance, and that practice operates to exclude a
disproportionate number of protected class members, then the practice is
prohibited.
c. Connecticut v. Teal (1982) - the “bottom line” defense (e.g.. who was actually
hired or promoted) is not an acceptable legal defense. Rather, the “job
relatedness” burden must be met where personnel decisions are made and
“prima facie” evidence is presented. The burden is on the defendant to prove
the practice was “job related.”
b) Validity Generalization(VG) – based on meta-analysis research. Uses
validation data from other studies to support validation for a different
situation with similar jobs
i. The mean of several correlational studies is a strong basis for concluding
that there is a valid relationship with similar jobs.
a VG study will meet the “job relatedness” burden for organizations
between test scores and job performance for similar job situations
c) “Alternative practices or procedures” - where two or more selection
procedures or practices are available which serve the user’s “legitimate
interest in efficient and trustworthy workmanship,” and which are equally
Chapter 03 - The Legal Environment of HRM: Equal Employment Opportunity
ii) Watson v. Ft. Worth Bank & Trust (1988) – disparate impact theory
can be applied to “subjective” employment practices such as
6. What Is Illegal Harassment?
a. Harassment is unwelcome conduct that is based on race, color, sex, religion,
1. The EEOC has published Guidelines for employers dealing with sexual
harassment issues
a) Meritor Savings v. Vinson (1986) - Quid pro quo or a causal relationship
1. Burlington Industries, Inc. vs. Ellerth (1988), and Faragher vs. City of Boca Raton
(1988) landmark Supreme Court rulings defining affirmative defense
2. Employer is liable when a hostile environment is created by a supervisor and
there is a tangible employment action (e.g., termination)
3. Employer liable if management was aware and does not exercise “reasonable
care”
4. A company is less likely to be found liable under the following can present the
following in support of an affirmative defense
a. There is a specific policy on harassment that a supervisor/employee violated
Chapter 03 - The Legal Environment of HRM: Equal Employment Opportunity
5. Farley v. American Cast Iron Pipe (1997) - Effective harassment policy can
6. What Steps Should A Company Follow Regarding Sexual Harassment?
a. Develop a written policy
7. Oncale v. Sundowner Offshore Services (1998) Supreme Court ruling that same
1. Refers to employers attracting, retaining, and upgrading members of protected
classes as defined by CRA
2. Activities once associated with AA are similar to current day Diversity initiatives
3. Contractor and subcontractors with more that $50,000 in government business and
50 employees must take affirmative action
4. Section 503 of the Rehabilitation Act requires federal contractors to apply AA to
persons with disabilities
5. Executive Order 11246 requires qualified government contractors to develop
written AA plans annually
6. The Office of Federal Contract Compliance Programs enforces Executive Order
1. Federal courts can order involuntary AA programs, and organizations can
implement involuntary programs
2. US Steelworkers v. Weber – establishes the “Weber Test” to ascertain the legality
of voluntary plans: Does not “unnecessarily trammel” the interests of majority
3. Johnson v. Santa Clara Transportation Agency (1987) – clarified further how a
company can embark on a voluntary program: two major conditions
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© 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
4. Qualifiers on appropriateness of an Affirmative Action Program
a. Should be narrowly tailored to achieve their ends with a timetable for ending
the preferential practice
b. Class-based firing or layoff schemes are too harsh on the innocent and
inappropriate in most circumstances
c. Preferential personnel practices of any kind are appropriate only in
employment situations where there is a prior history or indication of past
discrimination
5. Gratz v Bollinger, Grutter v. Bollinger (2004)– Supreme Court decisions
addressed the question of whether college admissions racial preference
programs are unconstitutionally discriminate (based on the equal protection
clause of the Constitution) against white students
1. Criteria for voluntary affirmative action plans
a. Fix old patterns of discrimination
2. Criteria for involuntary affirmative action programs
a. Remedy pervasive and egregious discrimination
b. Flexible benchmarks for court monitoring rather than rigid quotas
c. Be temporary
d. Does not unnecessarily trammel the interests of white employees
3. Ricci v. DeStefano- the Supreme Court ruled that standard for permissible race
based action is that the employer must “demonstrate a strong basis in evidence
that, had it not taken the action, it would have been liable under the disparate-
impact statute”
J. Is Affirmative Action Still Necessary?
1. Does the election of a black President indicate that EEO has been attained
2. “Glass Ceiling” refers to barriers still encountered by women and minorities
attempting to obtain senior managerial positions
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© 2013 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution in any
manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part.
F. Can Employers Claim Age As A Bona Fide Occupational Qualification (BFOQ)?
1. Courts have recognized age ceiling as legal when:
2. EEOC provides the following rules
a. Age limit is reasonably necessary for the business
b. All or almost all individuals over the age are unable to perform adequately
c. Some people over that age have a disqualifying characteristic that cannot be
determined independent of age.
V. The Americans with Disabilities Act of 1990 (ADA) Amended 2008
A. Extends to all private sector and state or local government employers with 15 or
more employees
B. EEOC received 25,165 charges of disability discrimination in fiscal year 2010, almost
10,000 more than in 2000. The ADAAA is probably mainly responsible for the
increase.
C. Summary of guidelines
1. An individual with a disability is someone who
a. Has an impairment that substantially limits one or more major life activity
b. Has a record of such impairment
c. Is regarded as having such and impairment
2. A qualified applicant/employee, is an individual who with or without reasonable
accommodation can perform the essential functions of the job
a. "Reasonable accommodations" should not pose an "undue hardship". Factors
3. Applicants may be asked about their ability to perform the functions of the job. A job
offer may be conditional pending the results of a medical examination.
a. ADA does not protect use of illegal drugs
b. A drug test is not considered to be a medical examination
c. A disability cannot pose a direct threat to the health or safety of others in the
workplace
D. What Is Legal And Illegal Under ADA?
1. Questions to applicants only about ability to perform job functions
2. Employers may not ask about disability
3. Disability limits one or more major life activity such as
Chapter 03 - The Legal Environment of HRM: Equal Employment Opportunity
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a. seeing
b. speaking
c. walking
d. reading
e. bending
4. Employers may ‘require documentation of the individuals needs for and
entitlement to reasonable accommodations.’
5. The Americans with Disabilities Act Amendments Act of 2008 makes important
changes to the definition of the term “disability” by rejecting the holdings of
Sutton v. United Air Lines and Toyota v. Williams Supreme Court decisions.
a. Expands the definition of “major life activities” by including those activities
1. GINA prohibits insurers from denying coverage to patients
2. GINA prohibits employers from making hiring, firing, or promotional decisions
based on genetic test results
VII. Pregnancy Discrimination Act of 1978
A. Prohibits discrimination based on pregnancy, childbirth, or related conditions
B. Does not guarantee same job or any job when return from pregnancy leave
C. The PDA stipulates that an employer cannot refuse to hire a pregnant woman if she
can perform the essential functions of the job
D. Employers must provide benefits for pregnancy as for other medical conditions
Chapter 03 - The Legal Environment of HRM: Equal Employment Opportunity
E. States may require additional benefits for pregnant employees
VIII. Are Expatriates Covered By Federal EEO Laws When They Are Assigned To Countries
Other Than The United States?
A. Civil Rights Act, ADA, and ADEA all have extraterritoriality
B. Americans working overseas for U.S. companies are covered
C. Also applies to resident aliens working for foreign companies on US soil
D. What are employee rights when working for multinational employers?
1. Figure 3-12
2. In general, all three laws apply to the American company and protect the American
worker
IX. Future Trends in EEO
A. Litigation and legislation will continue related to affirmative action/diversity
B. ADEA cases are expected to increase because of Smith v. Jackson and Meacham v.
Atomic Power allowing ‘disparate impact’ theory putting the burden of proof on the
employers; thereby increasing the proportion of workers who are eligible to sue
C. Business liability insurance to cover employment practices
D. Alternative Dispute Resolution: An Employer Reaction to Increased Litigation
1. Alternative dispute resolution expected to increase
2. More businesses requiring mandatory arbitration
3. EEOC v. Waffle House – EEOC can challenge arbitration decisions
4. Increase of EEO complaints filed by Muslims, Arabs, Sikhs, and others requiring
religious dress.
1. Monitor employment practices for disparate treatment or adverse impact.
2. Make sure disparities essential and are based on job-related reasons.
3. Eliminate practices that are not job-related.
