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Indirect Discrimination: Do You Know the Signs?

Jan 16, 2015
Deb Muller

Pick up any newspaper or read the latest headlines on your favorite newsfeed, and you will most certainly find a story about a pending discrimination lawsuit. The claims are probably in the well-publicized categories that you might expect – race, sex and age. In fact, these classes topped the most common types of discrimination claims recorded by the U.S. Equal Employment Opportunity Commission (EEOC) in 2013. The cases are often examples of direct discrimination with concrete evidence of bias, and the allegations are relatively straight-forward if for no other reason than they are clearly defined under Title VII.

But, there is a lesser-known form of discrimination which is both trickier to recognize and mitigate. Within the workplace, an employer cannot willfully discriminate or purposely treat employees differently, but what about situations which are not discriminatory by appearance but seem to result in discrimination nonetheless? These circumstances may perpetuate indirect discrimination and proving it can even be premised on inferred evidence or motives. When an employer’s actions constitute indirect discrimination, do you know the signs?

Indirect Discrimination Defined

Discrimination cases in the U.S. revolve around the concept of a protected class, a group protected from employment discrimination by law. Protected classes include categories such as race, sex and age as well as less obvious ones such as religion, national origin, or disability. Indirect discrimination means that a person in a protected class is subject to inferred discrimination or somehow disadvantaged by employment policies in a way that the broader group of employees is not. It may not even be intentional.

Indirect discrimination means that a person in a protected class is subject to inferred discrimination or somehow disadvantaged by employment policies in a way that the broader group of employees is not.

In Desert Palace, Inc. v. Costa, the Supreme Court ruled that circumstantial evidence is sufficient to prove that an employment action is motivated by discrimination, and in a powerful statement, the Court noted:

“Circumstantial evidence is not only sufficient, but may also be more certain, satisfying and persuasive than direct evidence.”

In spite of sound legal backing by the courts, organizations are still left with the thorny issue of trying to determine if indirect discrimination actually exists.

Here are two distinct signs of indirect discrimination:

Adverse Discriminatory Impact, Even Without Intent

Employers may enact certain policies while managing their business which seem innocuous enough, but if the policies have an adverse impact on protected classes or subsets of employees, they can be deemed as indirect discrimination nonetheless. There are numerous examples, but here is one that is most often cited and illustrates the concept:

In Griggs v. Duke Power Company, Duke Power required a benchmark IQ aptitude test score and high school diploma for applicants for some of the highest paying jobs in their steam station. The adverse discriminatory impact came about because African-American applicants were disqualified at a much higher rate than their white peers, and the U.S. Supreme Court determined that the purpose of the test was in fact to weed out African-Americans from the hiring process for those jobs. The hiring procedure did not fulfill a genuine business need and had an adverse impact on a protected class; therefore, it was deemed indirect discrimination.

Disparate Treatment, with Intent

Employers can also more purposely disadvantage protected classes, and this form of indirect discrimination is called disparate treatment. In this situation, two employees for example, must have essentially similar situations or qualifications but be treated differently by the employer, and the employee alleging disparate treatment must be part of a protected class. As you might imagine, disparate treatment is often cited when an employee misses a promotion, and in fact, a famous claim of disparate treatment went before the U.S. Supreme Court.

In McDonnell Douglas Corp v. Green, Green, a civil rights activist who had previously been laid off by McDonnell Douglas, applied for an open mechanic position at McDonnell Douglas and was qualified for the job. He was denied the position, but the job remained open. As an African-American, Green was a member of a protected class, and he argued disparate treatment under Title VII and won. In this case, the indirect discrimination was more deliberate in nature, not just an unintended consequence of company policies or rules.

ecause indirect discrimination can be substantiated with circumstantial evidence, it has broad implications for a company’s employment and human resource (HR) policies. To pass muster, today’s HR procedures must be thoughtfully conceived and implemented. Otherwise, while internal policies may have every intention of treating employees fairly, they may inadvertently disadvantage a subset of employees. The end result may be that your organization will confront a costly and time-consuming lawsuit.

Don’t be caught off guard. The key to effective employee relations risk management is the process, and HR Acuity® On-Demand provides the framework. A company can best defend itself from employee-related event risk by utilizing a systematic employee relations process which is participatory in nature and managed by well-trained staff.

Should allegations of direct or indirect discrimination occur in your company, HR Acuity On-Demand provides your organization with structured fact-finding tools, a framework for investigations, consistent documentation, case reports and a wealth of metrics for detailed analysis. Contact HR Acuity or call 888.598.0161 to schedule a 1-1 demo of our award-winning technology solution for employee-related risk mitigation.

Deb Muller
Deb Muller is the CEO of HR Acuity, employee relations case management and investigations software that combines documentation, process, and human expertise so organizations can meet the challenge of managing employee relations in the modern world.