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Business Ethics MGT610

LESSON 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 minorityin 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.

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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, that individual minority 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.

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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.

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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 onindeed, 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

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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 racismand 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

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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.

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