When an entrepreneur starts a business, it is important to have a legal professional look into whether they are in compliance with all relevant local, state, and federal laws and regulations. Applicable laws may concern issues such as licenses and permits, wage and hour requirements, or local zoning regulations. Non-compliance with any of these laws may subject a business to legal liability, and could potentially stall or even be fatal to the growth or continuation of a business venture. One particular concern for business owners is violating laws that prohibit discrimination in the workplace. The blog post is meant to give business owners a basic introduction to the federal law that governs workplace discrimination, and to help explain how to avoid some of the potential legal issues that may arise.

The Civil Rights Act of 1964 – Title VII

One potential source of liability for employers arises under Title VII of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color, religion, sex, and national origin. The law covers employers who have 15 or more employees that work each working day for at least 20 weeks in a calendar year. In addition to prohibiting discrimination directly against a particular employee for any of the protected reasons, it also prohibits employers from discriminating against an employee for associating with members of these groups.

Importantly, discrimination based on sex has been expanded to include sexual harassment, which occurs when an employer or another employee makes unwanted sexual advances, asks for sexual favors, or other sexually related conduct that affects another employee’s employment, work, or creates a hostile or offensive work environment. On the other side of the coin, sexual discrimination under federal law has not been expanded to include discrimination against employees who are lesbian, gay, bisexual, or transgendered.

Prohibited Employer Actions

The kind of actions that Title VII prohibits employers from taking are “adverse employment actions” that are made due to race, color, religion, sex, or national origin. Adverse employment actions could include:

  • Refusal to hire a qualified candidate
  • Termination
  • Failing to promote, or demoting an employee
  • Pay an employee less than others who do the same or similar work
  • Harassing or allowing others to harass an employee

If any these actions are taken for discriminatory reasons, an employee may have a claim under Title VII. An employer has the opportunity to show nondiscriminatory reasons for the adverse decision, shifting the burden back onto the employee to show facts that allow for an inference of discrimination.

Retaliation is also Prohibited

Title VII also prohibits employers from taking adverse employment decisions against employees who raise concerns against workplace discrimination.  The kinds of employee activity that are protected by the law include filing a complaint regarding discrimination, contacting the Equal Employment Opportunity Commission (EEOC), participating in an investigation, or suing an employer. In order to assert a claim for retaliation under Title VII, an employee must show that:

  • He or she engaged in an activity protected under the law, such as complaining about or reporting discrimination
  • The employee suffered an adverse employment decision
  • The employee’s participating in a protected activity caused the adverse employment decision

Consult with a Title VII attorney

Employers need to ensure that they and their employees understand and are in compliance with Title VII’s prohibition of discrimination. A discrimination lawsuit can be very costly, and also bring negative publicity to an organization. Any business facing allegations of discrimination should retain an attorney as soon as possible in order to mitigate and long term and potentially costly consequences.

- Claire Kalia


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