Legal Issues Impacting Human Resource Management

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Chapter 13
Legal Issues Impacting Human Resource Management
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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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The Emerging Issue
Federal, state, and local legislation is often
cited by many emerging firms as one of the major
barriers to growth. Compliance to these laws
covering hiring practices, compensation, employee
safety, and labor relations is viewed as a major
cost of doing business. Because of the huge
expenses related to fighting employee lawsuits or
paying government fines, integrating legal
compliance into daily management practices would
be extremely cost effective and beneficial for
the protection of the employees.
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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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Chapter Overview

• Legislation and government regulations have done
  more to spur the development of the human
  resource function than any other environmental
  factor. This chapter will provide an overview
  of
• Four major areas of government legislation
• Equal employment opportunity legislation
• Legal concepts of employment-at-will
• Negligent/hiring retention
• Concepts of adverse impact and affirmative action

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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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The Major Types of Legislation and Regulations
Equal Employment Opportunity
Compensation and Benefits
Employee Safety and Health
Labor Relations
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The Major Types of Legislation and Regulations
Equal Employment Opportunity

• To prohibit discrimination in employment based on
  minority/protected group status
• To establish an enforcement agency The Equal
  Employment Opportunity Commission (EEOC)
• To encourage government contractor /
  subcontractor compliance with EEO legislation and
  regulations

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The Major Types of Legislation and Regulations
Compensation and Benefits

• To establish pay equity among protected groups
• To establish pay guidelines for government
  contractors
• To support the concept of prevailing wage
• To provide guidelines regarding minimum wage,
  overtime, and child labor
• To provide administrative requirements for
  pension / retirement plans and other employee
  benefits

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The Major Types of Legislation and Regulations

• To protect employee rights to unionize
• To establish bargaining rules for management and
  labor
• To establish an enforcement agency The National
  Labor Relations Board

• To provide requirements for establishing a safe
  workplace
• To establish an enforcement agency The
  Occupational Safety and Health Administration

Employee Safety and Health
Labor Relations
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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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Equal Employment Opportunity Legislation and
Regulations

• The human resource function is a discriminatory
  activity. Decisions have to be made on whom to
  hire, fire, promote, give pay raises, etc. It is
  when these decisions are not made according to
  Equal Employment Opportunity Act requirements
  that a firm may find it has problems with illegal
  discrimination. Illegal discrimination can be
  formal defined as unfair actions towards members
  of a protected class.

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Congressional Acts
U.S. Constitution 5th Amendment U.S. Constitution
13th Amendment U.S. Constitution 14th
Amendment Civil Rights Act, 1866 and 1871 Equal
Pay Act, 1963 Civil Rights Act, 1964 (Title
VII) Age Discrimination in Employment Act,
1967 Equal Employment Opportunity Act,
1972 Pregnancy Discrimination Act,
1978 Immigration Reform and Control Act,
1986 Americans with Disabilities Act, 1990 Civil
Rights Act, 1991 Executive Orders 11246, 11375,
and 11478
See Exhibit 2.2 (page 446) for Intent and
Administration /Agency information
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Employee Rights (Common Law)

• Employees also have rights under what is called
  common law. Common law doctrine is based on
  court decisions and precedents. Some of the most
  important human resource issues that have
  developed through common law include
• Employment-at-well
• Negligent hiring /
• retention, and
• Constructive discharge

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Employment-at-Will

• Employment-at-will doctrine states that
  employment is at the will of the employer or the
  employee and either can sever the relationship at
  any time. Over the years, the courts have
  defined exceptions
• Public policy exception (whistle
• blower)
• Existence of a written or implied
• contract.
• Implied covenant of good faith or fair
• dealing.
• Separation that is in violation of an
• established law or ordinance.

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Negligent Hiring/Retention

• Negligent hiring and negligent retention holds
  employers responsible for exercising reasonable
  care in the hiring of their employees. It
  includes activities such as reference checks,
  criminal background checks, skills testing, and
  psychological testing. Negligent retention is
  similar to negligent hiring. It focuses on the
  situation in which organizations knowingly retain
  employees who have a high risk of injuring
  themselves or others.

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Constructive Discharge

• The common law doctrine of constructive discharge
  is based on the behavior of employers when they
  force employees to resign by creating intolerable
  working conditions. Intolerable conditions can
  include job reassignment, changing work hours /
  shifts, and allowing harassment by other
  employees.

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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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Proving Illegal Discrimination
Establishing Adverse Impact Adverse impact
occurs when an employment practice has a
disproportionate affect on member(s) of one
protected group. The plaintiff can use either a
disparate treatment or a disparate impact
argument.
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Disparate Impact

• Court decisions allow three types of data for
  determining disparate impact. These types of
  data are
• Comparative statistics compares hiring rates or
  ratios of protected minority groups to the hiring
  ratios of the majority group
• Demographic statistics compares the firms
  workforce to the population at large and
• Concentration statistics prove that protected
  minority groups are restricted to a particular
  job or level of jobs.

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Disparate Treatment
Disparate treatment exists when an employer
intentionally illegally discriminates against an
individual. To demonstrate disparate treatment,
the plaintiff must show the following

• The individual belongs to a protected minority
  group
• The individual applied for a job for which the
  employer was seeking applicants.
• Despite being qualified, the individual was
  rejected.
• After the individuals rejection, the employer
  kept looking for people with the applicants
  qualifications.

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Defenses to Discrimination

• The organization accused of illegal employment
  discrimination defends itself by proving that its
  selection procedures were 1) job related, 2)
  represented a bona fide occupational
  qualification, or 3) were subject to a seniority
  system.

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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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Affirmative Action Program (AAP)

• Affirmative action involves an employer taking
  the steps to recruit, hire, and promote members
  of protected groups. It should consist of the
  following four parts

• A utilization analysis showing the percentage of
  protected groups in the organization
• An availability analysis showing the availability
  of protected groups in the community.
• An identification of problem areas in which
  protected groups are under-represented or
  underutilized.
• An action plan with specific goals and timetables
  to deal with the identified problem areas.

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Affirmative Action Program (AAP)

• The three basic reasons requiring an organization
  to implement an AAP are

The three basic causes for an AAP are described
below

• A Government contractor
• Guilty of illegal employment discrimination
• Voluntary implementation

• Compliance with EO 11246
• Court-ordered Consent Degree
• Voluntary AAP

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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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Sexual Harassment

• There are two types of sexual harassment
• Quid pro quo sexual harassment where a supervisor
  trades sexual activity for advancement
  opportunities of some sort.
• Sexual harassment in which an unwelcome hostile
  environment is created by a supervisor or any
  other employee.

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How to avoid or reduce liability

• Make sure you have a written policy against
  sexual harassment
• Make sure everyone knows about the policy
• Investigate every complaint in accordance with
  your procedures
• Document every employment decision
• Refer to HR Tool Kit in Chapter 13

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Chapter Outline

• The Emerging Issue
• Chapter Overview
• The Major Types of Legislation and Regulations
• Equal Employment Opportunity Legislation and
  Regulations
• Proving Illegal Discrimination
• Affirmative Action Programs
• Sexual Harassment
• Chapter Summary

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Chapter Outline

• The legal environment in which the human resource
  function operates provides a huge challenge to
  emerging enterprises. Legal issues affect the
  field of human resource management in at least
  four areas. These areas are
• Equal employment opportunity,
• Compensation,
• Safety and health, and
• Labor Relations

• Chapter Summary