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Basic Steps to Avoid Discrimination in the Workplace

The U.S. Equal Employment Opportunity Commission (EEOC) reported that in 2018 it resolved 90,558 charges of workplace discrimination and collected $505 million for victims. Retaliation was the most frequently filed charge, followed by sex, disability and race.

What does this mean for employers? According to CERS (Cutting Edge Recruitment Solutions), the average out-of-court discrimination settlement for an employer is about $40,000 and the majority of cases are ruled in the plaintiff’s favor. Ten percent of wrongful termination and discrimination cases result in $1 million settlements.

Not all discrimination, though, deals with sex, disability or race. Another form of discrimination is when employers fail to offer benefits equally to all employees. For instance, granting special accommodations to one employee and not another — such as granting extra time off — can lead to inconsistencies, which can lead to lawsuits. Make sure you apply policies equally when dealing with promotions, vacation, pay, assignments, awards, discipline and termination.

Here are some guidelines for staying compliant with the law and making your company a more respectful workplace:

Based on Salaries

  • Respect non-exempt status: You must pay your employees overtime if they work more than 40 hours per week. However, there is an exemption, and this is where it gets tricky. You do not have to pay exempt employees, and they do not qualify for minimum wage because they are paid for work performed, not for the hours they work. There are strict guidelines as to who qualifies for status as an exempt employee, outlined by the federal government’s Fair Labor Standards Act and some state regulations. For an employee to be considered exempt, they must use their independent judgment in performing their duties at least 50 percent of the time and must earn more than $455 per week. An example of an exempt employee would be an executive who supervises at least two employees and makes decisions to hire or fire employees.
  • Base pay on job requirements: Salaries should be based on what the market demands, not on what a new employee made in a previous job or how long you’ve known that employee. If two employees are doing the same job, their salaries should be similar, although they do not have to be exact. Performance can be a factor.
  • Don’t deduct from exempt employees’ paychecks: You don’t pay exempt employees for overtime. But you also can’t dock their pay if they leave work early. Plus, if you dock your exempt employees’ checks for missing partial days, you’ve automatically made them non-exempt and you may owe them overtime.
  • Pay non-exempt employees for all of the time worked: It is illegal for you to make an employee work off the clock. It also is illegal for an employee to work off the clock when you tell them not to. If they do, you must pay them for the time they worked before you can fire them.

Based on Hiring and Firing Practices

  • Follow discrimination law: You must hire people based on their qualifications. You cannot discriminate on the basis of race, gender, age, national origin, disability, religion, sexual orientation or pregnancy. Some states and localities have additional laws regarding discrimination. However, it is legal to discriminate based on weight, unless the weight is considered a disability.
  • Document everything: Don’t fire any employee for poor performance or other issues unless you have documented the circumstances at least twice. Also, don’t be in a hurry to terminate an employee. In addition to being well documented, the decision to terminate someone’s employment should at least be reviewed by more than one manager and involve someone with Human Resources training. Also consider offering severance which can reduce the chance of a lawsuit.

Based on Employee Actions

  • Make it Easy to Report Complaints: Provide more than one option for employees to complain about discrimination so that they can bring legitimate issues to management’s attention. This also ensures that a supervisor cannot hide issues from Human Resources and upper management. The sooner you learn about a problem, and investigate, the sooner you can fix it.
  • Train Your Managers: Your managers need to be aware of potential discrimination issues in the workplace and how to handle complaints. If not handled properly, they can become lawsuits. Also, ensure that you have specialists knowledgeable in the Family and Medical Leave Act (FMLA) and Americans With Disabilities Act (ADA) rules and regulations.
  • Have a good handbook: Include up-to-date policies on issues including at-will employment; equal employment and harassment issues; work hours; leave and accommodation under the FMLA and the ADA; workplace violence; trade secrets and confidentiality of company information; and work rules and the consequences for violating them. Employees should acknowledge that they received and read the handbook.