The HR Impact of Gender Quotas on the Board of Directors

Whichever side of the line you stand on, everyone seems to agree that the new California Law requiring at least one board seat be filled by a female for publicly traded companies leaves a lot of room for debate and concern. In fact, Governor Jerry Brown wrote in his signing statement for SB 826, “I don’t minimize the potential flaws that indeed may prove fatal to its ultimate implementation.”  And, as is often the case, it is likely that other states will follow. Although California is the first to have binding regulations, Pennsylvania, Massachusetts, Illinois and Colorado, and various municipal governments, including the city councils of both Philadelphia and New York, have already passed nonbinding resolutions aimed at increasing female representation on boards.

As with many new business-related laws that take effect, HR should take preemptive steps to determine the impact this may have on their organization. The California Chamber of Commerce has argued that the new policy, “violates constitutional prohibitions against discrimination”, and “prioritizes gender over other aspects of diversity such as race or ethnicity.” When these statements are made publicly, discrimination claims tend to rise.

In light of the potential stir that may arise from the search for a female to add to a board that is already in place, the possible unseating of a current Director, or the placement of a so-called “token female” on the board,  HR may want to proactively consider the following measures as a way to step up to the table and provide added value in the process.

Provide a summary of the potential impact the search for a female Board placement could have on the company. Suggested items to be covered:

  • Reminder that placement without prior communication could create an impression that the Board is simply filling a mandated requirement with the easiest or safest option.
  • Communications early on as to what the Board is searching for including qualifications, experience, strategic vision and leadership capabilities can clarify the company goals for the position and prevent the appearance of bias.
  • Positive communication within the company during the process can create excitement as the company moves toward increased diversity, and the impact that will ultimately have on the company.
  • Clarification on who will own the placement process will prevent duplicated efforts.

Provide a proposal of how HR could assist with creating a positive outlook, such as:

  • Providing staff communications on the search, and how the company is excited to embrace this new opportunity for balance in leadership.
  • Assist with initial search efforts and screening to allow the process to move forward in a timely manner.
  • Suggest that HR could provide guidance to the Board on how to document the process and decision as protective measures against discriminatory claims after the fact.

In the long run, a more diverse and balanced Board of Directors will likely have a positive impact on business performance and company culture. Taking the initiative to shine a positive light from the start can make the process better for everyone involved.

Hey CEO, are you confident in your harassment reporting process? #NoRetaliation

When asked about their current workplace investigation process, most CEOs will respond with, “HR has that under control.” To which I respond, “That’s good. When was the last time you talked with HR about it?” For those who responded that they have had a recent conversation, it generally went something like this:

(CEO) “Hi, I take it you have been hearing about all of the sexual harassment claims in the news.”

(HR) “Yes, I can’t believe that there is a new claim almost daily.”

(CEO) “Are you hearing anything from our employees.”

(HR) “Not really. A little joking around, but that’s it.”

(CEO) Okay, but we’re covered, right? I mean, do we have systems in place to handle this type of thing in case an employee complains?”

(HR) “Sure, but I will let you know if we get a complaint.”

(CEO) “Great. Keep up the good work.”

Has the CEO in this situation done enough to communicate just how important this matter is to the organization?  Not in my opinion, because the conversation doesn’t prompt any action toward driving change. I get it. These conversations are not comfortable and no one wants to bring up a potential problem. But early intervention can mean the difference between quietly and respectfully correcting a problem, and a very public lawsuit.  Here are 5 questions every CEO should be asking HR to begin the conversation and the road to prevention.

  1. What is our current process for handling sexual harassment misconduct?
  2. Is this process fully compliant with state and federal legal requirements?
  3. Are our employees familiar with the process and are they using it?
  4. Are we proving training and encouraging employees to come forward immediately with their concerns?
  5. How much of the HR budget is being put toward Sexual harassment prevention?

And then ask, “What can I do to support HR in preventing sexual harassment in our workplace?”

The common thread in the media news reports is that the victims did not report the incidents when they initially happened due to fear of retaliation. According to the EEOC, “…on average, anywhere from 87% to 94% of individuals did not file a formal complaint. Employees who experience harassment fail to report the behavior or to file a complaint because they anticipate and fear a number of reactions – disbelief of their claim; inaction on their claim; receipt of blame for causing the offending actions; social retaliation (including humiliation and ostracism); and professional retaliation, such as damage to their career and reputation. (EEOC Task Force Study on Harassment)

CEOs, executives, board members, managers and HR professionals, this can’t wait until tomorrow. Start the conversation today. #NoRetaliation

Ready to simplify your workplace investigations? Learn how at GoInvestiPro.com.

Sexual Harassment; the silent epidemic.

With as often as you hear of new sexual harassment cases in the news, you may wonder why I refer to Sexual Harassment as the silent epidemic. Unfortunately, the stories that make the news often leave the public feeling as though this only happens in big business and tv land. But the silent side of sexual harassment can, and is, happening throughout all industries, in all size companies across the US. The statistics provided by the Equal Employment Opportunity Commission (EEOC) prove that fact. And it is time for employers to realize that this can be happening right under their noses, if they are not implementing policies and training to prevent it from happening.

On Sunday night, NBC Nightly News ran a story that revealed the true statistics, Continue reading

KPMG Settles with the OFCCP to Pay $420K to Asian Applicants.

Last week, KPMG (one of the big four accounting and audit firms) agreed to pay $420,000 to 60 qualified Asian applicants who were allegedly not hired due to their race/ethnicity. The firm entered a conciliation agreement with the DOL/Office of Federal Contract Compliance Programs (OFCCP) after applicant and hiring data was found to have had a disparate impact on the hiring of Asians for the associate audit positions in the Short Hills, New Jersey location.  The settlement not only includes back wages and interest, but also allows class participants to be considered first for employment in open associate audit positions until six are hired or the list of interested class members is exhausted.

I have heard discussion that this is not a huge expense to such a large, world-wide company. And that is likely true. However, the bad publicity and continuing exposure due to the case will be far reaching. Not only is there bad press, but claims of this type will likely cause a significant reduction in the applicant pool for open positions at KPMG.  The cost of expanding the search for appropriate staff can be significant. In addition, the OFCCP is requiring the firm to revise their hiring practices, policies and procedures, and monitor the selection process through every step for every open recruitment to ensure selection procedures are not having an adverse impact. This information will need to be reported and provided for audit upon request. The legal defense fees alone, which have accumulated since the inception of this case in 2011, make this a very expensive oversight on the part of KPMG.

This settlement effectively closes the OFCCP investigation and claim. But there are still other means of punishment and restitution that may come for KPMG such as the claim of systemic gender pay disparity and promotion discrimination still pending in the U.S. District Court for the Southern District of New York.

Will There Be Over 90,000 Discrimination Charges Filed In 2017?

The U.S. Equal Employment Opportunity Commission (EEOC) recently released the 2016 statistics for discrimination and harassment cases filed for the year, showing an increase for the second consecutive year. Discrimination charges were filed in 91,503 cases (29% being sex based claims).  The interesting point here is that the agency responded to over 585,000 calls and more than 160,000 inquiries in field offices. So how did the 745,000 complaints only turn onto 91,503 cases? Well, there were most certainly those complaints that did not meet the legal definition of discrimination or harassment. And then there were the ones that were dismissed due to the fact that the employer met the legal requirement of conducting a prompt and impartial investigation, and took appropriate action to ensure the improper behavior ceased. If one of your employees contacted the EEOC, would your company be one of the dismissed complaints or one of the over 90,000 per year that results in a legal claim?

Many employers still do not understand that when a complaint is received, conducting a proper investigation is your first and best defense. Historically over 50% of claims received by the EEOC are dismissed strictly on the basis of the employer having taken appropriate action.   Let’s face it, even if your company did not violate the law, the cost comes in proving that fact. Once the EEOC receives a complaint, if the employer did not investigate the situation properly, the claim progresses toward litigation. And litigation is very costly. Not just in fees, but in company morale, reputation and employee time. This is why you so often hear of companies settling the claims monetarily while insisting that they were not at fault.

In my blog post next week, I will review what happens once the EEOC receives a claim from an employee, and begin examining the process of an employer responding to a claim. We will look at the process when the employer conducted an investigation, and when they did not.

If you have specific points you would like covered or questions you would like answered, please add them in the comment session, and I will do my best to address them.

2016; An Example of Need for Harassment Prevention.

Looking back on 2016, I was saddened by the onslaught of news stories covering lawsuits and settlements related to sexual harassment and discrimination. Of course there were the big suits that received most of the media attention, Fox News, Chipotle Grill, Mc Donald’s Corp., etc.  But it seemed that the small to mid-sized companies were seeing an abundance of claims as well.  In July, USA Today released a report that 1 in 4 women have been subject to sexual harassment in the workplace at least once. And the Huffington Post stated that the number is actually 1 in 3 women, but let’s not forget the men. According to the EEOC, over 20% of the harassment claims filed include male victims. Sadly, just last week, CNN released an article titled, “The year in harassment: 2016 sunk lower than rock bottom”, based primarily on the increase of online harassment and cyber bullying. This is a very troubling trend and a clear sign we need to increase harassment prevention measures.

What I find interesting is the high percentage of employers that I talk to who state that their company has never had any type of complaint or any need to conduct a workplace investigation into the possibility of harassment or discrimination. Although this may be the case for tightly held small companies and family run businesses that have few employees, many of these are companies that have been in business 10 – 30 years, with 100 to 1000 employees. My conclusion, many companies are still burying their collective heads in the sand as to what goes on in their workplace and are avoiding conducting investigations in the hopes that a claim will not arise. Really? No improper jokes, pictures, or comments? No aggressive managers or disgruntled employees causing arguments or making others uncomfortable with the statements they make? No employees feeling overlooked for promotions or pay scales based on their gender, race or religious affiliations? No vendors making comments on how an employee dresses, using homophobic slurs or constantly asking out employees? Some companies are lucky. Most are not.

The majority of the companies I consult with and the HR professionals I talk with have their policies and harassment and discrimination training in place, but one important element is missing. If your company is not conducting an investigation every time they become aware harassment or discrimination may be taking place, they are missing out on an important prevention method. Statistics show that employers who conduct workplace investigations as a standard business process, see a steady reduction in the number of incidents and claims based on the employees knowing that they will be held accountable for their actions. It creates a culture where employees pause before they speak or act to ensure they are not out of line. And with the EEOC Strategic Enforcement Plan for 2017-2021 focusing on preventing systemic harassment, it’s time to get proactive.

If you have questions or concerns regarding conducting workplace investigations, getting executive buy- in, or how to change your process to a standard business function, please feel free to leave a comment or email me directly at Dana@GoInvestiPro.com.

EEOC to Focus on “Holistic Prevention Programs” to Prevent Harassment.

With the release of the EEOC Strategic Enforcement Plan (SEP) for 2017 – 2021, it is time to take a look at your Complaint, Investigation and Prevention processes and procedures. The SEP outlines the EEOC’s principal areas of focus for the next four years. According to the plan, the EEOC will increase efforts to ensure that employers implement processes that will serve as a deterrent to violations. Will your current processes meet that requirement?

In short, the EEOC wants to see that employers are taking steps to prevent harassment and discrimination, which most frequently are based on sex, race, disability, age, and national origin.

To assess your prevention program, ask the following 7 questions:

  1. How often are your employees being trained?
  2. Is your training current and relevant?
  3. Are your managers actively looking for signs of harassment and discrimination in the workplace?
  4. Are employees encouraged to bring their concerns forth, and provided a safe and comfortable means of doing so?
  5. Does the company have a standard business processes in place that will allow immediate response to complaints in order to determine if an investigation is necessary?
  6. Is your investigation process compliant, consistent and unbiased?
  7. Does your process include a plan for returning to work after an investigation without judgment or retaliation?

I am hopeful that you are taking a sigh of relief right now because your processes are buttoned up. But if not, it’s time to add this to your priority list. And remember, InvestiPro can help.      www.GoInvestiPro.com

 

You can review the entire EEOC Strategic Enforcement Plan at https://www.eeoc.gov/eeoc/plan/sep-2017.cfm, or read a simple overview provided by Fox Rothschild.

DO POLITICAL ARGUMENTS = HOSTILE WORK ENVIRONMENT?

With the vote happening next week in a what may be the most contentious presidential election in U.S. history, HR and Managers need to closely monitor the temperature to make sure conversation do not elevate to the point of bullying or creating a hostile work environment.  According to an article published by SHRM, “Sixty percent of HR professionals said their employees are more vocal about their political opinions than in elections past—meaning workers are more frequently engaging in political discussions or even arguments.” Although this period is temporary, the long-lasting impact on employee relationships may be long lasting or even permanent.

Consider this:

There are 3 employees in the purchasing department, which are housed right next to the two employees in the Shipping and Receiving department. The S&R employees (we’ll call them Bob and Sheila) are very busy in the morning and afternoon, but not as busy mid-day. Both Bob and Sheila back the same candidate, and much of their downtime is spent sharing campaign rhetoric, talking over their cubicles about how no person in their right mind would vote for the other candidate (whom they refer to “That #$@&*%!”). Although the Buyers have discussed among themselves that this makes them uncomfortable, they don’t want to confront Bob and Sheila as they are concerned the behavior will just escalate.

On the day before the election, the first Buyer arrives at work to find a cartoon sketch with the title of “Let’s keep “That #$@&*%!” out of office.” The drawing is a picture of a divided polling place where opposing parties are directed into a separate area where they step through the door to face a firing squad. When the other Buyers arrive, they agree that this is a bit scary and has gone too far. But instead of addressing Bob and Sheila, they decide as a team to ignore them, leave their work on their desks with notes, and avoid any direct contact until things quiet down.

When the manager arrives, and sees the cartoon, he has to decide what step to take next.

  1. Take down the cartoon and tell Bob and Sheila to knock it off, knowing that after the

election things will probably get back to normal.

  1. Make light of the situation so that everyone knows it is not serious and just an

attempt at election humor.

  1. Get HR involved and talk with everyone effected to determine the impact this has

had on the employees.

Remember, the law states that Harassment becomes unlawful where 1) enduring the offensive conduct becomes a condition of continued employment, or 2) the conduct is severe or pervasive enough to create a work environment that a reasonable person would consider intimidating, hostile, or abusive. Does this rise to the level of a hostile work environment? Maybe, or maybe not.  The point is that employers do not know the impact these situations will have on employees unless they investigate.

An investigation does not need to be a long drawn out chaotic process. In fact, using investigations as a standard business process to determine what is happening in the workplace and taking action or changing processes and/or policies actually drives engagement. When employees know that everyone is held to a common set of rules and expectations, they feel respected and comfortable coming forward, before problems escalate. This allows for a simpler and more immediate resolution.

If you have any questions, or would like to chime in on how your company is working through this election period, I would love to hear your comments.

Is McDonalds Corp. a co-employer of franchise employees?

Independent franchise owners need to watch for the court decision on this as it could have wide spread implications. As explained in this article published yesterday by SHRM,  15 Employees filed sexual harassment claims in which McDonalds Corp. was named a co-employer. Needless to say, the outcome of this will have a serious impact on the franchiser/franchisee relationship, and how business agreements are set up moving forward. Not just for McDonalds and the restaurant industry, but all franchise relationships. That being said, whether or not the franchiser (McDonalds in this case) is found to be held liable as a co-employer, this does not relive the independent franchisees of their responsibility to conduct a prompt and impartial investigation into these complaints. Investigating complaints is not just the law, it is the right thing to do. Failing to investigate is costly. Taking retaliatory action may entitle the victim to punitive damages, at the discretion of a jury. This is where the high dollar settlements come into play. This is easy to prevent folks. Complaint = Investigation. Every time!

Not sure how to conduct a proper investigation, check out www.investipro.com.

InvestiPro mentioned in Top 5 HR Tech Conference Moments

Not only did Steve Boese, Conference Chairman, vote for InvestiPro as the Next Great HR Technology Company last week at the HR Technology Conference in Chicago, he included us in his Top 5 Moments at the Conference. https://t.co/yIloNDhS2O

Discovering the Next Great HR Technology Company

While HR Tech, and plenty of other shows, have done startup tech company demonstrations and competitions in the past, this year at HR Tech we decided to introduce a new spin on the concept.  Borrowing from the format of the popular TV series “The Voice”, we paired up and coming HR technology companies with their own expert ‘coaches’, (Trish McFarlane, Ben Eubanks, Madeline Laurano, Kyle Lagunas), who not only ‘found’ and nominated these companies for participation in the event, but also collaborated and coached them on their presentations and delivery for the event itself.

 

At the session, ably hosted by Jason Averbook, each of the 8 participating companies, (InvestiPro, ClickBoarding, Chemistry Group, LifeWorks, Clinch, HighGround, RolePoint, and Qwalify), had 5 minutes to talk about their solution, and show it off a little, followed by about 2 minutes to answer a question or two from one of our expert coaches. After 8 fast-paced demonstrations and discussions, the audience got to vote for who they thought would be ‘The Next Great Technology Company’ – a vote won by LifeWorks in what was an extremely tight race.