By Craig J. Cantoni
Capstone Consulting Group
Scottsdale, Arizona
(480) 661-8175
Fax 661-8155
E-mail Ccan2@aol.com

The truth is, if a company does not thumb its corporate nose at the law, the chances of getting hit with an expensive lawsuit are about the same as winning a state lottery.

Two types of people file discrimination charges: fruitcakes and those who truly believe that they've been wronged.

To paraphrase Forrest Gump, stupid is as the stupid EEOC often does.

Unfortunately, there is not much employers can do to defend themselves against stupidity, other than help fix America's public education.

Too many human resources people are spending their time worrying about the sky falling instead of helping to make the work place more productive and motivating.

Many market leaders are successful in spite of their human resources practices, not because of them. Their success is due to the groundwork laid years ago by their entrepreneurial founders, to their commanding market shares and to their economies of scale.

Mountains or Molehills?

In its December 14, 1998 issue, US News & World Report had a cover story titled, "Cupid's Cubicles," about office romances and sexual harassment, in which Craig Cantoni was quoted. The following is a more extensive summary of Craig's views and research on sexual harassment and other employment laws.

The Sky Is Falling

Almost instantaneously after the United States Supreme Court decides an employment case, the material ends up in your mailbox in greater quantities than credit card solicitations. It's as if the producers of the stuff have spies in the Court who tell them in advance what the decision is going to be. After all, big money is at stake. What is it? It's pounds of advertisements for all of the seminars, legal guides, training programs and videos offered by the growth industry of law firms, consultants, and training companies that make money on explaining an ever-increasing variety and complexity of employment laws and court cases.

The headlines on the material are scary:

• Avoid multi-million-dollar lawsuits. Subscribe now to our legal update series for only $160 per month before it's too late.
• Save your company money, save yourself embarrassment, save your neck. Attend the best seminar in the country on the new Supreme Court decision on sexual harassment.
• Mitsubishi learned the hard way. Don't let what happened to them happen to you.
• Buy this or die. (Okay, we made up that one.)

Only a fool or a gambler would ignore such headlines and not buy what is being sold. Or so they want you to believe. They won't say this, but it may be foolish to pay for information that can be obtained for nothing in The Wall Street Journal, The New York Times and a handful of other periodicals that still do in-depth reporting. Don't want to bother reading a newspaper? Then type in "employment law" in an Internet search and get everything you ever wanted to know about staying out of legal trouble.

Take the June, 1998 Supreme Court ruling on sexual harassment. The ruling was clear: Employers can be held liable for the actions of their supervisors, and they have a responsibility to publish and communicate a sexual harassment policy that outlines the complaint procedures and recourses available to employees. Period. Still uncertain over what to do? Then search the Web for sample policies or ask acquaintances in other companies to send copies of their policies. Of course, it's much more fun if you're living in Cleveland to attend an employment law course in Scottsdale, in February.

The solicitations are effective, because like an avalanche, they start with a pebble of truth. Sure, an employer can get into legal trouble by ignoring the law. But only stupid employers ignore the law.

The Facts

The truth is, if a company does not thumb its corporate nose at the law, the chances of getting hit with an expensive lawsuit are about the same as winning a state lottery. In a 20-year human resources career that began in 1972, the year that the EEOC got enforcement powers, this writer never got hit with an expensive lawsuit and can count on one hand the number of discrimination charges that went to the EEOC on his watch.

Granted the times have changed, thanks to a belief propagated in Washington, D.C. and by the legal profession that people have a right to sue if they get their feelings hurt at work. And, admittedly, the statistics on EEOC charges are frightening: Between 1991 and 1997, the total number of discrimination charges of all types filed with the EEOC went up 26%. And sexual harassment charges went up a mind-boggling 130%. But merit resolutions account for only 11.0% and 18.8%, respectively, of those charges. ("Merit resolutions" is a label given by the EEOC to charges that it views in its wisdom as having merit. It includes charges that may not have had merit in a layman's definition of the word "merit" but were simply cases in which the employer paid off the claimant to avoid the aggravation, time and expense of trying to resolve a frivolous case.)

Let's look at the numbers more closely: In 1997 there were a total of 80,680 charges. Of those, 8,875, or 11.0%, were deemed to have merit. At the end of 1997, there were about 137 million people in the civilian labor force. Dividing 8,875 by 137 million equals .00065. Therefore, .065% of employees will file a "meritorious" charge with the EEOC each year, the vast majority of which can be settled for a nominal amount. For a company of 1,000 employees, that means less than one meritorious charge per year. And since the number of charges filed nationally includes government workers, who are particularly unhappy and litigious, the odds are even less than that for private-sector employers.

Two types of people file charges: fruitcakes and those who truly believe that they've been wronged.

Fruitcakes

There is not much that can be done about fruitcakes, other than not hiring fruitcakes. How do you avoid hiring fruitcakes? Simply by conducting in-depth interviews. In addition to asking the standard questions about chronological work history, the reasons for leaving past employers and expectations for the future, it is advisable to ask questions like the following:

• What was your best and worst job? Why do you feel that way?
• Describe your best and worst boss? Why do you feel that way?
• What do the words "good place to work" mean to you?
• What does the word "fairness" mean to you in terms of how you want to be treated?
• Give an example of when you were not treated fairly by a past employer?
• What do you think it takes to get ahead in most companies? How have you seen favoritism and politics determine who gets ahead? What do you think about that? How do you deal with it?

Questions like these are designed to get a dialogue going that will shed light on a candidate's values and mindset about the world of work and to screen out thin-skinned people with a chip on their shoulder.

Speaking of fruitcakes, a client of the writer got hit with a sexual harassment claim from an employee of a temporary agency, who claimed that a male employee of the same agency had sexually harassed her. When asked to explain the basis of the complaint, the woman said that her fellow employee had asked her to count from one to ten. Apparently, the fellow employee thought that the woman was incompetent and too stupid to count to ten, which, given her definition of sexual harassment, may have been true.

In its bureaucratic wisdom, the EEOC refused to dismiss the charge, even though it was without merit and even though it was filed by a temporary agency employee against another temporary agency employee, both of whom had been retained by the client for a temporary assignment, and neither of whom were on the client's payroll. To paraphrase Forrest Gump, stupid is as the stupid EEOC often does. (Amazingly, even congressional Republicans think that the agency needs more people and money to do its job. No, it needs more common sense.)

"Harassment," an All-purpose Word

As the above example illustrates, "harassment" has become an all-purpose word. More and more women and men (11.6% of sexual harassment charges are filed by men) are filing harassment claims that have nothing to do with sexual harassment, even as broadly as the courts have defined it. Such geniuses think that harassment is when a boss stays on your case to get something done. That may be an example of good or bad management, depending on one's management philosophy, but it sure isn't sexual harassment. Unfortunately, there is not much employers can do to defend themselves against stupidity, other than help fix America's public education.

What is interesting about the confusion over the meaning of harassment is that many of the confused claimants work for companies that have held lengthy training programs on the meaning of harassment. It is not within the scope of this paper to debate the merits of such programs, but generally, it is ill-advised to conduct them and other awareness-type sessions, for all they do is make employees hypersensitive to perceived injustices and teach them how to take action against their employer.

Texaco is a case in point. Its diversity training program was the primary cause of it getting in hot water over the use of the "n" word, although once the media hysteria was over, it was proved that the word was never used by the white managers who had been surreptitiously recorded talking about the company's diversity program. Among other things not reported in the mainstream media about the case, the white managers had expressed frustration over the fact that black employees had refused to stand for the National Anthem during a company function and had demanded that the Black Anthem be played. (This writer will devote an entire chapter to the complicated subject of diversity training in an upcoming book being co-authored with Marianne Jennings. The theme of the book is the reasons why smart companies believe subversive ideas.)

Having discussed fruitcakes, let's now turn to a discussion of normal people who file EEOC claims.

The Solution for Normal People

The vast majority of normal people file charges because they don't feel valued, respected and listened to. In other words, they are not treated like human beings. Consequently, they seek outside recourse when they perceive that they have been discriminated against.

The solution is obvious: make people feel valued, trusted, respected and listened to, instead of treating them like potential litigants. Unfortunately, too many human resources people are spending their time worrying about the sky falling instead of helping to make the work place more productive and motivating. Regrettably, much of the human resources profession has made a pact with the devil in the federal government. The pact goes like this: "My power, pay and prestige continue to go up in lockstep with increasing numbers of employment laws and with the growth of the regulatory state, so keep increasing the number of employment laws. An exaggeration? You be the judge.

HR's Affection for the Regulatory State

The largest human resources association is the Society for Human Resource Management. SHRM recently celebrated adding its 100,000th member, reflecting a growth rate of 110% since 1990, almost paralleling the 130% increase in sexual harassment claims for the period. In fairness, other associations depend on the regulatory state for growth, including the American Society of Safety Engineers and the American Institute of Certified Public Accountants, both of which have grown 54% and 21%, respectively, over the last ten years. And there are literally hundreds of other associations that have a vested interest in an ever-growing big government. (In the meantime, high-wage manufacturing employment has remained flat for the last decade. And the pundits wonder why the nation is bifurcating into "haves" and "have-nots.")

As reported in The Wall Street Journal a few years ago, 66% of HR people voted Democratic in a previous election. (The reference has been misplaced.) Of course, that is their own business, but it becomes the business of business if it translates on the job to a belief in egalitarianism over merit, excuses over accountability and paternalism over performance all of which creates a culture of entitlement, which in turn creates unrealistic expectations about fairness, which in turn results in more lawsuits, which in turn increases the demand for HR people, which...well, you get the picture.

The most popular speakers at HR association chapter meetings are employment law attorneys, who generate business for themselves by exaggerating the dangers of EEOC suits. No one stands up at the meeting and says that the problem is too many attorneys filing too many lawsuits and occupying too many congressional seats in Washington. And for sure, no one mentions the leftist agenda of the American Bar Association. Speaking of which, the ABA's draft agenda for its 1999 midterm meeting reads like a Marxist manifesto. It can be found on the ABA's web site, www.abanet.org. One of the agenda items is amending ERISA to allow lawsuits to be filed in state courts against employer health plans. HR people who disdain the regulatory state should be in their CEO's or corporate counsel's office talking about how to blunt the ABA's efforts, instead of listening to ABA members drum up business at chapter luncheon meetings, so that they can afford to attend the ABA's midterm meeting, where they will vote on anti-business measures.

Concluding Remarks

This cannot be proven empirically, since the EEOC will not release data on claims by name or size of company; but there is plenty of anecdotal evidence that companies on both ends of the spectrum get in the most EEOC trouble, while those in the middle do not have much to worry about. At one end are the small, unsophisticated, low-wage companies that scrape the bottom of the labor barrel for workers. At the other end are the big, bumbling bureaucracies that believe in inflexible, one-size-fits-all personnel policies. Ironically, the big, bumbling bureaucracies are held up in the human resources profession and in the business press as examples of how to run a business and manage people, when in fact, they are often examples of how not to manage people. Many market leaders are successful in spite of their human resources practices, not because of them. Their success is due to the groundwork laid years ago by their entrepreneurial founders, to their commanding market shares and to their economies of scale.

A concluding word of advice for the majority of companies in the middle of the spectrum. continue doing what you're doing and don't emulate your bigger brethren. Continue making people feel needed and important, continue basing rewards and promotions on merit, continue helping people see the connection between what they do and the success of the business, continue the feeling of teamwork and espirit de corps, and continue communicating openly and honestly with everyone and you'll continue to reduce the risk of lawsuits. We'll be glad to help you with that, since it is our expertise. But we refuse to read regulations to you, since you probably learned long ago to read on your own.

This article may be copied and distributed without permission. It is not intended to be a substitute for consulting or legal advice, or a foolproof prescription for staying out of legal trouble. So, in other words, don't try to blame or sue us if you get hit with an employment lawsuit. Sorry, but in this litigious age, we have to say things like that. If you don't like it, please file a complaint with the ABA. Or better yet, stop reimbursing your in-house attorneys for their ABA dues.

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