Even small business owners must be aware of instances of employment discrimination in the workplace. No small business, regardless of how small, is exempt from all employment discrimination laws. Consciously and unconsciously, discrimination can occur among owners and employees. As a business owner, you must set the tone in your company and not allow discrimination of any type. Regardless of who in your organization perpetrates the discrimination, you are ultimately responsible, and your business is legally liable for those actions.
The first step in combating this challenge is awareness and education.
Employment discrimination is the unfair treatment of an individual or a group of individuals based on their race, color, ethnic or national origin, language, age, religion, sex, sexual orientation, military service, or disability status. Employment discrimination occurs when an employer makes decisions or provides or withholds opportunities based on a protected characteristic. Federal and state laws also protect workers from retaliation for reporting instances of discrimination against themselves or participating in a claim or investigation. Employment discrimination can occur in many forms, including hiring, firing, promotion decisions, pay, or benefits. It may also take the form of harassing or abusive workplace conditions.
Employment discrimination can be overt or covert. Overt discrimination is when the decision is based on a protected characteristic and is publicly communicated. It is an explicit display of unequal treatment of an individual or group because of a protected characteristic they possess. Overt discrimination may include a boss who tells a female employee that women don’t make good managers and when she later applies for a promotion to manager, a less qualified man is selected. Covert discrimination is when there are no apparent or communicated signs of discrimination, but the protected characteristic is a factor in the decision. A well-qualified Army National Guard soldier applies for a promotion and a less qualified candidate with fewer years at the company is given the promotion instead. The supervisor has never publicly said anything about the Soldier’s service but harbors resentment toward the soldier because he must cover the soldier’s shifts on drill weekends when they are at training. He complains about covering the shifts although he doesn’t state the reason. Covert discrimination can be difficult, but not impossible to prove. Employment discrimination is most likely to occur when someone is new to a workplace, either as an applicant or as a newly hired worker.
These are the federal laws that cover employment discrimination.
Title VII of the Civil Rights Act of 1964. This Act makes it illegal to discriminate against someone based on race, religion, national origin, or sex. This includes refusing to hire someone for any of these reasons. In June 2020, the U.S. Supreme Court held that an “employer who fires an individual merely for being gay or transgender violates Title VII” of the Civil Rights Act. Title VII applies to businesses with 15 or more employees.
The Pregnancy Discrimination Act. This Act amended Title VII to expand the protections regarding “sex” to include prohibiting sex discrimination based on pregnancy, childbirth, or a medical condition related to pregnancy or childbirth. This Act applies to businesses with 15 or more employees.
The Equal Pay Act of 1963 (EPA). It prohibits sex-based wage discrimination between men and women who perform equal work in the same workplace. The Equal Pay Act applies to employers with any number of employees.
The Age Discrimination in Employment Act of 1967 (ADEA). This act protects employees or job candidates who are 40 or older from discrimination in the workplace. This law applies to businesses with 20 or more employees.
Title I of the Americans with Disabilities Act of 1990 (ADA). Makes it illegal to discriminate against a qualified person with a disability in the process of employment or during employment. It requires employers to make reasonable accommodations in working conditions for employees with disabilities. The ADA applies to businesses with 15 or more employees.
Uniformed Services Employment and Reemployment Rights Act (USERRA). This Act makes it illegal for employers to deny employment, or terminate employment, of a current or former service member because of his or her obligations to the military. USERRA applies to businesses with any number of employees.
These laws form the basis of how the Equal Employment Opportunity Commission (EEOC) enforces employment discrimination complaints. Federal courts interpret these laws on an ongoing basis. Additionally, each state has its employment discrimination laws and enforcement agencies to investigate and prosecute claims of employment discrimination.
Questions about how these laws may apply to your small business?