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Dec. 2, 2020

Summer of unrest could lead to more workplace laws on diversity

Workers began detailing allegations of discrimination or harassment by their employers on social media. Complaints were filed, and investigations were triggered. As with the nationwide conversations around sexual harassment during the #MeToo movement, this year's discourse on race emboldened workers to speak up, and for many employers and policymakers, navigating their concerns quickly became a top priority -- second only to navigating COVID-19.

This spring, when companies across the nation were issuing statements in support of Black workers and the protests that erupted over the killing of George Floyd, parallels emerged between the protests' impact on the nation's workplaces and the impact made by the #MeToo movement years earlier.

Workers began detailing allegations of discrimination or harassment by their employers on social media. Complaints were filed, and investigations were triggered. As with the nationwide conversations around sexual harassment during the #MeToo movement, this year's discourse on race emboldened workers to speak up, and for many employers and policymakers, navigating their concerns quickly became a top priority -- second only to navigating COVID-19.

Policies to increase diversity, address bias, and expand complaint avenues for victims of discrimination in the workplace all gained traction in recent months, in many cases expanding -- or even mirroring -- efforts forged during the #MeToo movement. While workers' advocates say it's time for employers and policymakers to extend #MeToo-era protections to all protected classes -- and not just women -- management-side attorneys say the practical challenges of implementing some #MeToo policies were never resolved and will likely persist as their scope expands.

Of this year's new policies, AB 979 most explicitly aims to build on gains made by the #MeToo movement. The bill, which is slated to go into effect on Jan. 1, requires publicly-held companies headquartered in California to have at least one member on their board of directors come from an underrepresented community. This requirement must be met by the end of 2021, but the quota will increase for some companies by the end of 2022. In 2018, the California Legislature passed a similar bill focused on increasing gender diversity on corporate boards.

Another bill signed by Gov. Gavin Newsom in September, SB 973, aims to ensure equal pay for women and minorities by requiring employers to submit an annual report to the state Department of Fair Employment and Housing, with pay data organized by gender, race, ethnicity, and job category.

Other policies forged in response to conversations on race did not come in the form of legislation, said Jennifer L. Liu, who represents workers as managing partner at the Liu Law Firm, PC. In recent months, Liu has seen a number of companies voluntarily dropping mandatory arbitration policies for discrimination claims. These decisions are coming even as the future of AB 51 -- which bans employers from requiring employees to sign mandatory arbitration agreements for most employment claims and has not been enforced since a federal judge issued a preliminary injunction banning the state from enforcing the law in February -- remains a question. (The state has since appealed the district court's preliminary injunction, and the 9th U.S. Circuit Court of Appeals is set to hear oral argument on Dec. 7.)

After #MeToo, Liu said, many companies agreed to "carve out sexual harassment claims from their arbitration policies ... because we realize that that has the impact of brushing sexual harassment complaints under the rug."

"If it's good policy for survivors of sexual assault and harassment, then it should be good policy for all people who have been impacted by discrimination," she said.

Pankit J. Doshi, who represents management as a managing partner at McDermott Will & Emery, agreed the protests' impact on the workplace was largely internal. In recent months, he said, clients have reached out to ask how they could promote diversity among their employees as well as mentor and retain employees of color.

"#MeToo started some very important discussions related to women in the workplace, but it's not enough just to talk about a gender issue," Doshi said. "They also need to expand to people of color. How can we get the same levels of protection for diverse individuals -- the way that the #MeToo movement has helped to shine a light on gender issues?"

The challenge, Doshi said, has been striking a balance between the interests of employers and workers. Like Liu, Doshi said he's noticed a number of companies discussing whether they should drop mandatory arbitration policies for discrimination claims.

"The concern from an employer perspective, of course, is that if you drop the arbitration provisions, any claims on these issues could become public. They could be tried in a court of public opinion as opposed to a tribunal of the law, so there's always been a hesitancy surrounding that," he explained. "That's been balanced by the importance of taking these issues seriously, and how to make sure we empower our employees."

Many of the challenges employers will face with these new policies are logistical, according to Gina L. Miller, who represents management as a partner at Snell & Wilmer LLP.

"A lot of these laws and rules now require the employer ... to now inquire, who is LGBTQ? What is your national origin?" she said. "One of the things that we've always been taught in hiring is ... you don't want to be asking questions like that."

"It's definitely put the employers in a position where now they have to be intimately involved in all this information in order to make sure their board is compliant," Miller said of AB 979, the most recent board diversity bill.

Employers could potentially be exposed to privacy claims if they asked employees questions about which demographics they belong to, which could make collecting the data difficult, she said. One way for employers to minimize exposure to such claims, Miller said, would be to only appoint to boards employees who have already divulged they belong to an underrepresented community or tell employees they can apply for a board position if they meet the demographic requirement, so they can volunteer the information themselves.

Doshi noted multiple lawsuits have sought to challenge SB 826, the gender board diversity bill, on equal protection grounds, and he said AB 979 is exposed to similar risks. Conservative activist organization Judicial Watch, which filed one of the lawsuits challenging the gender board diversity bill, sued the state over AB 979 in October.

The state's new pay data rule presents practical issues too, Miller said, particularly for small businesses.

"They don't have the resources to hire somebody who's going to be able to necessarily do all of these things," she said, adding the state agency tasked with collecting the data will also likely continue to lack resources.

"There's no question the Department of Fair Employment and Housing is going to be overwhelmed, so there's only a certain percentage that will be investigated," Miller said of any reports that show pay gaps.

Miller said that in her experience, the California Legislature -- at least over the past decade -- has viewed employment law as an avenue for addressing social justice concerns.

The fact that many of the employment policies that came in the wake of this year's protests resemble those forged during the #MeToo era is not lost on Toni J. Jaramilla, who represents workers at her own firm, and also worked on a number of bills that came out of the #MeToo era. She said many of those bills -- including AB 9, which extends the statute of limitations for filing claims to the Department of Fair Employment and Housing -- apply to minorities as well as women, but were widely understood as only benefiting victims of sexual harassment.

Jaramilla said she hopes policies that did have a more narrow scope will be expanded. This includes SB 820, which bans secret settlements in cases of sexual harassment, sexual assault, or discrimination based on gender.

"My personal hope and view is that ... there's a parallel bill" that will expand a similar ban to other types of discrimination claims, Jaramilla said.

"To me, this conversation is unlike any other," Doshi said. "The closest that I can think of was the Rodney King riots back in the 1990s in Los Angeles that led to some conversations, but I do believe this was different."

"When the community and the country's having these conversations, it behooves employers to follow suit and to ensure that they are a safe haven and a safe place for their people," he added. "Half the battle is having that dialogue."


Jessica Mach

Daily Journal Staff Writer

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