The New York State Bar Association Task Force on Advancing Diversity advises increased reliance by companies on recruiting, retention, and advancement of underrepresented populations while ensuring that their hiring procedures comply with the longstanding ban on race-based hiring. The report provides practical steps, including examples of current strategies companies are using, to mitigate potential legal risks.
The report provides a useful overview of the current legal and political challenges in play for corporate DEI efforts.
- Notably, these include a wide range of activities going beyond the traditional employment discrimination framework to include shareholder actions.
- In addition, new state laws can pose challenges that did not exist before.
- Yet, the report also notes “the significant risks associated with retreating from publicly committed DEI efforts.”
- “Companies that abandon their public commitments may be subject to (1) Securities and Exchange Commission (SEC) investigations and shareholder derivative suits; (2) disparate treatment and disparate impact actions; and (3) additional negative impacts like loss of top talent or reduced financial performance.”
The report validates approaches that our member companies are taking while offering specific guidance. Both before and after the Harvard decision large companies have been taking a number of the actions recommended in the report. These include privileged assessments of their efforts, assessing internal and external communications and perceptions of those efforts, and ensuring proper training of managers and employees. The report articulates how these, and other efforts, can be maximized. For example, assessments of DEI-related policies should be comprehensive and include not only hiring, promotion and retention, but also:
- Compensation and compensation practices;
- Goal setting;
- Fellowships or internships, scholarships, mentorships and sponsorships;
- Leadership development programs;
- Diverse slate policies;
- Supplier diversity programs; and
- Corporate giving programs.
The assessment should go beyond the programs as described, but “also consider how they are understood and applied by decisionmakers. This is why robust training on DEI, especially at the manager level, is critical.”
Development and retention of existing talent is an important aspect of achieving DEI goals. While non-discrimination law tends to focus on hiring and other employment decisions, employers have greater leeway in their efforts to ensure that existing employees from underrepresented populations are retained, with their development being a key aspect of that retention. Along those lines, the report makes several specific recommendations that would apply broadly to all employees, including:
- Effective use of employee resource groups (ERGs), which can also help achieve the company’s inclusion goals by: “(1) opening participation in certain ERG gatherings to allies or not limiting inclusion or participation to members of specific demographic groups; (2) where appropriate, having group programming open to all members of the community to facilitate understanding and discussion; and (3) having multiple affinity groups co-promote events to increase discovery of areas of common ground.”
- Using formal training programs to acculturate and develop new employees, “level[ing] the playing field for new entrants by providing clear guidance and instruction on skills and knowledge development, as well as soft skills such as working in teams, negotiation and client service.” This, along with effective mentoring, can enhance performance by employees at an earlier stage.
- Providing access to “challenging and ‘visible’ work opportunities [which] provides exposure to leadership and leadership opportunities and consequently offers an opportunity to forge relationships that will in turn lead to future work opportunities.” In this approach, “ensuring that work is fairly allocated is of paramount importance.”
- Helping employees “to build robust networks by leveraging strategic partnerships with clients and other external stakeholders. These initiatives can help diverse employees expand their networks beyond their workplace.”
- Objective and inclusive succession planning that avoids measures causing “leaders to select individuals who are like them.”
Join us on Monday, October 23, for the latest on the employment implications of the Harvard decision. Our expert panelists examine the latest in legal analysis, how companies are assessing and changing programs, the potential restriction of affirmative action in the workplace, and the impact these actions could have on talent strategies designed to increase workforce diversity.