March 12, 2024
Diversity and Inclusion (D&I) Backfire Again
This case has every lesson that HR professionals have been telling managers and leaders for years, from documenting performance, to doing it accurately, to (not) giving out employment references, and more.
A white man was recently awarded $10M when a court found he had been discriminated against based on his race, sex, or both. Find similar stories here and here and here. Like the other cases, the discrimination was found to be the result of the employer’s D&I program. What happened? Here is what the 4th U.S. Circuit Court of Appeals (covering MD, VA, WV, NC, SC) found in this recent case.
The employer’s stated reasons for firing the employee were a lack of engagement and loss of support from the executive team. The court, however, found and noted the following evidence.
- The employer’s D & I plan read, “We want to reach our targets…set by the organization…making sure our work force reflects the community we serve…intentionally integrate…fully embed diversity and inclusion throughout the company.”
- When the employee was fired, the record showed he “performed exceptionally in his role, receiving strong performance reviews.”
- The employee’s most recent engagement scores were higher than the boss who fired him.
- There was “no record of any documented criticism of performance or reasons for his termination.”
- In giving a reference to a recruiter about the plaintiff after his separation, the employer praised his performance, said he would hire him again, and his discharge was not a reflection of poor performance.
- His vacancy was initially filled by two current employees, a white woman and a black woman, one of whom was rated a lower performer that the discharged male.
- The employer later hired another black woman to permanently fill the vacancy, “one of three finalists for that position – all black women.”
- Four months prior to the plaintiff’s discharge, the employer fired another white male whose job performance received a “high potential and medium performance” rating. That employee was replaced by a black male.
- An incentive plan was developed that tied executive bonuses, in part, to achieving D&I goals.
- Approximately one year later the data showed a decrease in white leaders and an increase in black and women leaders.
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.” However, while the court did find the unlawful discrimination to be intentional to meet its target D&I goals, it was not “in the face of perceived risk that its actions would violate federal law” and reduced the monetary award.
What is the message? It is not to abandon your DEIBA initiatives. It is to ensure they have established goals, are monitored for adverse impact to any employees or applicants based on any protected status. 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.
