Written by Christine Walters
What are the small business rules for DEI? The same as for other employers. The last few years have generated headlines touting unintended consequences of employers’ Diversity, Equity, and Inclusion (DEI) initiatives. Some align with the full acronym of DEIBA, adding belonging and accessibility to the mix. Whatever initiative you have or have considered, proceed with caution. It is often the case that these good intentions go awry and land employers in hot water.
What are some pitfalls to avoid? When an employer takes an employment action such as hiring that is based on a legally protected characteristic like sex or race, that may constitute unlawful discrimination. Any focus on race, sex, age, gender identity, or any other legally protected characteristic should be applied in the recruitment process, not in the selection decision. The initiative should include goals to attract and retain more qualified candidates of a particular demographic into your applicant pool.
For example, on March 12, 2024, the 4th U.S. Circuit Court of Appeals, which includes Maryland, found an employer intentionally and unlawfully discriminated against a white male to meet its target D&I goals when it fired him, allegedly for poor performance, and temporarily replaced him with two current employees. His replacements were women, one was a black female. His final replacement was another black female.
The court noted the following (and more):
- The record showed the fired employee “performed exceptionally in his role, receiving strong performance reviews.”
- There was “no record of any documented criticism of performance or reasons for his termination.”
- In giving a reference to a recruiter, the employer praised the fired employee’s performance, saying he would hire him again, and his discharge was not a reflection of poor performance.
- One of the two women who temporarily filled his vacancy was rated a lower performer that the discharged male.
The court reminds us that when there is no documentation to support the reasons an employer gives for discharging an employee, “such circumstances are indicative of pretext for unlawful discrimination…we see no reason to reach a different conclusion here.”
What is the message? It is not to abandon your DEIBA initiatives. It is to ensure they are crafted to avoid legal liability. Talk to your company’s legal counsel about when and how to periodically monitor your program’s results for adverse impact and avoid any unintended consequences.
