Business Ethics
Handout
Lecture No. 45
The Ethics of Job Discrimination
This lecture discusses one of the internal conflicts that arise in business, namely
the issue of job discrimination. It begins by quoting two long passages illustrating
the current state of the debate in the U.S.–one by former President Bill Clinton,
one by former California Governor Pete Wilson.
Clinton calls for the U.S. to preserve its affirmative action programs. He outlines
many inequities that still remain in American business, and argues that
affirmative action is still necessary to "give our nation a way to finally address the
systematic exclusion of individuals of talent on the basis of their gender or race."
As long as there are no specific quotas, he maintains, then the affirmative
action's critics are wrong.
Wilson, on the other hand, cites Thomas Jefferson in his criticism of affirmative
action. He argues that it is unfair to award jobs based on any criteria other than
merit. He sees affirmative action as preferential treatment, "special privileges" for
a select minority–in effect, a type of reverse discrimination.
Because discrimination based on gender and race have been around for so long
in business, its consequences in this area have been substantial and persistent.
This chapter examines the nature of discrimination, discusses the ethical aspects
of such behavior, and concludes by considering affirmative action programs in
particular.
Job Discrimination: Its Nature
Though more women and minorities are entering formerly white male-dominated
jobs, they still face discrimination. The experiment conducted by ABC shows that
women and minorities were systematically given less consideration in hiring: they
received fewer job offers and less desirable jobs than white males. Other
research suggests that blacks and Hispanics were offered jobs 50% fewer times
than white males.
Discrimination in its root meaning is not at all wrong. It simply refers to the act of
distinguishing one object from another. However, in modern usage, the term refers
to "wrongful discrimination," or distinguishing among people on the basis of
prejudice instead of individual merit.
Discrimination in employment involves three basic elements:
1. It must be a decision not based on individual merit.
2. The decision must derive from racial or sexual prejudice.
3. The decision must have a harmful impact on the interest of employees.
Discriminatory acts themselves can be categorized according to the extent to
which they are intentional and institutionalized. An act may be part of the
isolated behavior of a single individual who:
1. Intentionally discriminates based on personal prejudice.
2. An act may be part of the routine, institutionalized behavior of a group.
3. The act must intentionally discriminate out of personal prejudice.
4. An act may be part of the isolated behavior of a single individual who
unintentionally discriminates because he or she uncritically adopts the
practices and stereotypes of his or her society.
An act may be part of the systematic routine of a group that unintentionally
discriminates because group members uncritically incorporate the discriminatory
practices of society.
Whereas in the early 1960s discrimination was generally seen an intentional and
individual, by the 1970s a shift had occurred to emphasize the effects of
unintentional forms of discrimination. A group would be guilty of discrimination if
minority group representation were not proportionate to the minority group's local
availability.
Subsequently, people came to criticize this view. They argued that discrimination
was the act of individuals, and that individual minorities and women were its
victims. The problem with this criticism is that it is often difficult to know whether
a specific individual, was discriminated against. The only way of telling whether a
process is fair or discriminatory is to see what happens to minorities as a group.
American society has gone back and forth on this issue ever since. Many even
believe that though businesses in the U.S. used to be discriminatory, they are no
longer so.
Discrimination: Its Extent
An indication of discrimination exists when a disproportionate number of a certain
group's members hold less desirable positions despite their preferences and
abilities. We can make three types of comparisons to provide evidence of this
type: comparisons of average benefits given to various groups, comparisons of
the proportion of a group found in the lowest levels of the institution, and
comparisons of the proportion of a group found in the most advantageous
positions in the institution. When we make these three comparisons, it seems
clear that some form of discrimination is still present in the U.S., though for some
groups it is not as intense as it used to be.
Income comparisons are the most suggestive indicators of discrimination. The
income gap between whites and blacks, counter to what many think, has not
decreased (black average family income remains about 65% that of whites).
There are similar inequalities found based on gender as well. Though the ratio
between male and female earnings is getting more equal, this is largely due not
to a rise in female earnings but to a drop in, male earnings. Disparities begin
immediately after graduation; in fact, female college graduates earn about as
much as male high school graduates. In every occupational group, women earn
less than men. Blacks fare a bit better than females, but not much. For black
male college graduates, the picture is better: they now earn about what white
male college graduates do.
For most other blacks, however, the picture remains grim. Lowest income group
comparisons and desirable occupation comparisons give similar results.
Statistically, larger proportions of minorities and women are poor, and larger
proportions of white males have the most desirable occupations. In fact, the more
women who work in an occupation, the lower the average pay for that job.
Though perhaps some of the disparities between white males and women or
minorities can be accounted for by the preferences of the latter (who voluntarily
choose to work in the lower paying jobs), the disparities are so large that it
cannot entirely be accounted for in this way.
The difficulties for minorities seem to be getting worse. Though they will soon be
a majority of the labor force, studies indicate that many of the new jobs that will
be created will require education beyond high school, and most minorities are
falling behind in their educational attainment. For women, another obstacle
exists: unwanted sexual attention.
Finding that our economic institutions generally seem to embody discrimination,
as this section proves it, does not in itself prove that any particular business is
discriminatory, however.
Discrimination: Utility, Rights, and Justice
Given the inequalities found in U.S. businesses, we must address the issue of
whether these inequalities are wrong and, if they are, how they should be
changed. Arguments against discrimination fall into three groups: utilitarian
arguments, rights arguments, and justice arguments. The utilitarian argument
against discrimination maintains that society's productivity will be highest when
jobs are awarded based on competence or merit. Discrimination based on
anything else is inefficient and, therefore, counter to utility.
Utilitarian arguments have been attacked on two fronts. First, if jobs should be
assigned on the basis of job-related qualifications only so long as such
assignments will advance the public welfare, then if public welfare would be
advanced to a greater degree by assigning jobs on the basis of some factor not
related to job performance, then the utilitarian would have to hold that in those
situations jobs should not be assigned on the basis of job related qualifications,
but on the basis of that other factor. Second, it might be true that society as a
whole would benefit by having some group discriminated against.
Other, non-utilitarian arguments against discrimination maintain that it is wrong
because it violates people's basic human rights. Kant, for example, says that
humans should be treated as ends in themselves and never as a means to an
end. Therefore, discrimination is wrong because it violates people's rights to be
treated as equals. In addition, some Kantian thinkers argue that discrimination is
wrong because the person who discriminates would not want to see his or her
behavior universalized (at least they would not want to change places with the
victim of their own discrimination).
A third group of arguments against discrimination views it as unjust. Rawls
argues that it is unjust arbitrarily to give some people more opportunity than
others. Another related argument sees it as a form of injustice because
individuals who are equal in all relevant respects cannot be treated differently just
because they differ in other, non-relevant respects. The problem with this
argument is that it is difficult to define precisely what counts as relevant and to
explain why sex and race are not relevant, but intelligence is.
Despite the difficulties with these arguments against discrimination, there are five
widely recognized categories of discriminatory practices:
1. Recruitment practices that rely on the word-of-mouth referrals of present
employees will tend to recruit only from the groups already represented.
2. Screening practices that include qualifications not relevant to a job (such
as requiring a certain level of education for very low-level jobs).
3. Promotion practices that place groups on separate tracks or that rely
solely on seniority when past discrimination has kept women or minorities
out of senior positions.
4. Conditions of employment that do not award equal wages and salaries to
people doing essentially the same work.
5. Discharging an employee based on race or gender, or layoff policies that
rely solely on seniority.
Women are victims of a different and troublesome type of discrimination: sexual
harassment. Generally, the guidelines against sexual harassment are clearly
morally justified. However, there are some aspects of the guidelines that must be
examined. They prohibit more than just particular acts of harassment, they also
prohibit creating an intimidating, hostile, or offensive working environment.
This raises some difficult questions. Are mechanics who hang pin-up calendars
guilty of sexual harassment? Though most people now say yes, there are a
number of critics who say that these kinds of environments were not intended to
degrade women, and besides, women have the power to take care of
themselves. In addition, the guidelines say that verbal or physical contact is
harassment if it has the effect of unreasonably interfering with the victim's work
performance. This means, claim some critics, that sexual harassment depends
on the purely subjective judgments of the victim; what is unreasonable to one
person may seem perfectly acceptable to another.
A more serious objection to such guidelines is that they violate people’s right to
free speech. However, though these objections may be valid on college
campuses, they are not at all relevant to businesses, where free discussion and
examination of ideas are not the focus.
A firm can be guilty of sexual harassment even if it did not know and could not
have known that the harassment was going on–indeed, even if the firm had
expressly forbidden the offensive act. Supporters of the guidelines point out that
the harms caused by sexual harassment should be considered a cost of doing
business, which it is proper to internalize.
Groups other than women and racial minorities can be the victims of
discrimination. The disabled, victims of AIDS, homosexuals, and the overweight
are all discriminated against. Currently, there are no federal laws prohibiting
discrimination against many of these groups.
Affirmative Action
So far, the policies discussed in this chapter are all negative, aimed at preventing
further discrimination. Affirmative action programs, in contrast, call for positive
steps designed to eliminate the effects of past discrimination. Such programs are
now legally required of all firms holding government contracts.
Affirmative action programs begin with a detailed study, a "utilization analysis" of
the major job classifications in an organization. The analysis is designed to
discover whether there are fewer minorities or women in a particular job
classification than could reasonably be expected. If the analysis shows that
women or minorities are underutilized, then the firm must establish practices to
correct these deficiencies.
The U.S. Supreme Court has not been clear about the legality of affirmative
action programs. Rulings suggest significant vacillation on the issue. The main
grounds for attacking them is that, in attempting to correct the effects of past
injustice, affirmative action may actually be racially or sexually discriminatory
itself.
In the face of this objection, supporters of affirmative action make two main
counterarguments. One of these is to interpret affirmative action as a form of
compensation for past injuries. The other interprets preferential treatment as an
instrument for achieving social goals. The former arguments are backward
looking, focusing on the wrongness of the past; the latter are forward looking,
instrumentalist arguments focusing on what the future ought to be.
Those who see affirmative action as a form of compensation maintain that white
males must pay reparations for unjustly injuring others by discrimination in the
past. The difficulty with such arguments is that the principle of compensatory
justice requires that compensation should come only from those specific
individuals who intentionally inflicted a wrong, and should be paid only to those
specific individuals who suffered that wrong. It does not require that
compensation should come from all members of a group containing some
wrongdoers, nor that compensation should go to all members of a group
containing some injured parties. Many have attempted to counter this argument
by claiming that every minority living today has been injured by discrimination
and that every white male has benefited from those injuries. Whether these
arguments are successful or not is unclear.
The second way of justifying affirmative action sees it as an instrument for social
change. Based on the statistics such as those at the beginning of this chapter,
such arguments maintain that race and gender provide an indicator of need.
Since reducing this need is consistent with utilitarian principles (as it will increase
total utility), affirmative action is justified.
Objections made to this argument question whether the social costs of affirmative
action outweigh their benefits. However, even more elaborate and convincing
arguments for affirmative action are made. They argue that the goal of affirmative
action is social justice, and that affirmative action is a morally legitimate means
for achieving this goal.
Presently, women and minorities do not have the equal opportunity that justice
demands statistics prove this. The conscious and unconscious bias that brings this
injustice about must be neutralized, along with the competitive disadvantages with
which women and minorities are burdened. The basic end, therefore, is a more
just society, and preferential treatment is a morally legitimate means to attain this
end.
However, three reasons have been advanced to show that affirmative action is
not, in fact, morally legitimate. First, it is claimed that affirmative action
discriminates against white males. However, given the definition of
discrimination, because the preferential treatment is not based on contempt of
white males, it cannot be said to be the same thing as discrimination against
minorities or women.
Second, some claim that preferential treatment violates the principle of equality
because it takes into consideration race, which is an irrelevant characteristic.
Defenders of affirmative action counter by saying that sexual and racial
differences are actually relevant characteristics. Third, critics claim that
affirmative action actually harms minorities by implying that they are so inferior to
white males that they need special help to succeed. This claim is countered by
saying that, though affirmative action undoubtedly has some costs, the benefits
of such programs outweigh them. Moreover, they point out that affirmative action
is not based on an assumption of white male superiority but on recognition of
bias in favor of white males. Finally, they point out that though some minorities
may feel inferior because of affirmative action, many more are made to feel
inferior because of racism–and besides, showing preference towards them does
not make them feel inferior. The arguments on both sides are powerful, and the
debate continues.
Because of concerns raised by opponents of affirmative action, guidelines have
been suggested to ensure that its more harmful effects will be lessened. Of
course, the problems encountered by minorities differ markedly from those
encountered by women. Recently, some proposals that are more radical than
affirmative action have been made to deal with sexual discrimination. Since the
jobs women have historically taken pay low wages and salaries, proponents of
comparable worth programs attempt not to place women into higher paying jobs,
but to increase the salaries of those jobs where women currently are employed.
In a comparable worth program, each job in a firm is assigned a certain number
of points for difficulty, skill requirements, experience, and other factors. Then,
jobs are assumed to deserve equal pay if they score similarly. The fundamental
argument in favor of comparative worth is the principle of justice. Opponents
counter that the market is the most appropriate determining factor of wages. If
the market pays a certain job a low salary, they claim, it is because there is a
large supply of workers in that category.
In the near future, only a small proportion of new workers will be white males.
Because of this demographic trend, firms' enlightened self-interest will prompt
them to give women and minorities special consideration. If they do not
accommodate themselves to these workers, they may not be able to find the
workers they need to compete in the world market.
