Managing a Diverse Workforce Chapter 17 Copyright © 2014 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Ch. 17 Key Learning Objectives  Knowing in what ways the workforce of the United States is diverse, and evaluating how it might change in the future  Understanding where women and persons of color work, how much they are paid, and the roles they play as managers and business owners  Identifying the role government plays in securing equal employment opportunity for historically disadvantaged groups, and debating whether or not affirmative action is an effective strategy for promoting equal opportunity  Assessing the ways diversity confers a competitive advantage  Formulating how companies can best manage workforce diversity, making the workplace welcoming, fair, and accommodating to all employees  Understanding what policies and practices are most effective in helping today’s employees manage the complex, multiple demands of work and family obligations 17-2

The Changing Face of the Workforce  Diversity – Refers to variation in the important human characteristics that distinguish people from one another  Primary dimensions: age, ethnicity, gender, mental or physical abilities, race, sexual orientation  Secondary dimensions: such characteristics as communication style, family status and first language  Workforce diversity: diversity among employees of a business or organization  Represents both a challenge and an opportunity for businesses 17-3

The Changing Face of the Workforce  Today, the U.S. workforce is as diverse as it ever has been, and it is becoming even more so. Consider the following workforce diversity trends:  More women are working than ever before  Immigration has profoundly reshaped the workplace  Ethnic and racial diversity is increasing  The workforce will continue to get older  Millennials are entering the workforce 17-4

Gender and Race in the Workplace  Following World War II, the proportion of women working outside the home has risen dramatically  Most dramatic increases have been married women, mothers of young children, and middle-class women  Increase in professional, technical and service jobs produced “demand-side” pull for women into the labor force  Labor force rates for minorities have always been high  Change is that wider range of jobs are available to minorities as discrimination barriers have fallen 17-5

Figure 17.1 Proportion of Women and Men in the Labor Force

The Gender and Racial Pay Gap  Pay gap – Women and persons of color on average receive lower pay than white men do  Gap has narrowed over the past 3 decades  Still, in 2010 black men still earned only slightly more than three ‑ quarters of white men’s pay; black women earned about 70 percent, and white women 81 percent 17-7

Figure 17.2 The Gender and Race Pay Gap

The Gender Pay Gap  Reasons for pay gap  Some believe is evidence of sexual discrimination  Some believe is women’s choices in pursuing lower paying jobs or slower advancement  Others believe occupational segregation is occurring Inequitable concentration of a group in certain job categories  Women have made great strides in entering professional occupations, however “pink collar ghetto” still exists Examples include preschool teachers and secretaries 17-9

Women and Persons of Color in Management  Women have broken into management ranks  Tends to be, however, in occupations where women are numerous like education and health care  Only a very few women or persons of color have achieved highest positions in corporate America  Although women and minorities are as competent as white men in managing people and organizations, they rarely attain the highest positions in corporations 17-10

The Glass Ceiling  Invisible barrier that exists in reaching these higher levels has been named the glass ceiling  Reasons for the glass ceiling:  Glass walls – fewer opportunities to move into positions that lead to the top; many women and minorities start in staff rather than line positions  Recruiters fill positions by word of mouth and is still “old boys network”  Recent advances show some cracking of the ceiling 17-11

Figure 17.3 Extent of Diversity in Selected Management Occupations 17-12

Women and Minority Business Ownership  Some women and minorities have chosen to avoid the glass ceiling by opening up their own businesses  2010, 40% of over 10 million U.S. businesses were owned or controlled by women  Although most female-headed firms are small, collectively they employed over 13 million people in the United States and generate $1.9 trillion in sales 17-13

Women and Minority Business Ownership  According to the Small Business Administration, there were around 5.8 million minority-owned businesses in the United States in 2007  Hispanic-owned businesses were the most numerous, followed by African-American and Asian-owned businesses  Immigrants were responsible for a good share of the entrepreneurial spirit in the minority community; immigrants are nearly 30 percent more likely to start a business than are non-immigrants 17-14

Equal Employment Opportunity  Government involvement in securing equal employment for all began in the 1960s on a large scale  Is defined as discrimination based on race, color, religion, sex, national origin, physical or mental disability, or age  In U.S. is prohibited in all employment practices  Government contractors must have written affirmative action plans detailing how they are working positively to overcome past and present effects of discrimination in their workforce  Women and men must receive equal pay for performing equal work, and employers may not discriminate on the basis of pregnancy 17-15

Major Federal Laws and Executive Orders Prohibiting Job Discrimination Figure

Affirmative Action  Since mid-1960s, government contractors been required to have affirmative action plans  Purpose to reduce job discrimination by encouraging companies to take positive steps to overcome past discriminatory employment practices  Affirmative action became increasingly controversial in the 1990s and 2000s  Some states passed laws banning it in public hiring  Opponents cite possibility of reverse discrimination  Some women and persons of color called for less emphasis on affirmative action, preferring to achieve personal success without preferential treatment 17-17

Sexual Harassment  Occurs at work when:  Any employee, woman or man, experiences repeated, unwanted sexual attention or  When on ‑ the ‑ job conditions are hostile or threatening in a sexual way  It includes both physical conduct—for example, suggestive touching—as well as verbal harassment, such as sexual innuendoes, jokes, or propositions  It can also occur if a company’s work climate is blatantly and offensively sexual or intimidating to employees  Is illegal and U.S. EEOC is empowered to sue on behalf of victims  E.U. recognized sexual harassment as a form of gender discrimination in 2002, required its member states to bring their laws into compliance by

Racial Harassment  Is also illegal, under Title VII of the Civil Rights Act  Under EEOC guidelines, ethnic slurs, derogatory comments, or other verbal or physical harassment based on race are against the law, if they create an intimidating, hostile, or offensive working environment or interfere with an individual's work performance 17-19

Preventing Sexual and Racial Harassment  In 1998, the Supreme Court ruled that companies could deflect lawsuits by taking two steps:  Develop a zero-tolerance policy on harassment and communicate it clearly to employees  Establish a complaint procedure—including ways to report incidents without retaliation—and act quickly to resolve any problems  In addition, stated that companies that took such steps would be protected from suits by employees who claimed harassment but had failed to use the complaint procedure 17-20

Diversity Policies and Practices  Well run companies go beyond required legal actions to welcome employees of all backgrounds  Actions taken by companies to manage diversity effectively:  They articulate a clear diversity mission, set quantitative objectives, and hold managers accountable  They spread a wide net in recruitment, to find the most diverse possible pool of qualified candidates  They identify promising women and persons of color, and provide them with mentors and other kinds of support  They set up diversity councils to monitor the company’s goals and progress toward them 17-21

Strategic Advantages of Managing Diversity Effectively  Companies that promote equal employment opportunity generally do better at attracting and retaining workers from all backgrounds  Businesses with employees from varied backgrounds can often more effectively serve customers who are themselves diverse  The global marketplace demands a workforce with language skills, cultural sensitivity, and awareness of national and other differences across markets  Companies with effective diversity programs can avoid costly lawsuits and damage to their corporate reputations from charges of discrimination or cultural insensitivity 17-22

Balancing Work and Life  Changing demographics, including increasing number of dual income families, have led people to adopt wide range of strategies for combining full and part-time work with the care of children, elderly relatives, and other dependents  Helping “make it work” for employees trying to balance the complex, multiple demands of work and family life has became a major business challenge 17-23

Child Care and Elder Care  Types of programs companies are offering:  Child Care  Elder Care  Parental and family leave  Work flexibility  Benefits to non-traditional families  Some employees have been reluctant to take advantage of work flexibility options, for fear of being labeled “mommy track” or “daddy track”  A shift in corporate cultures is needed to truly become a “family friendly” company where men and women are fully supported in their efforts to balance work and family responsibilities 17-24

Domestic Partner Benefits  Many corporations in the United States have begun to acknowledge differences in employee sexual orientation and gender identity. Gay, lesbian, bisexual, and transgender employees have become a vocal minority, winning important victories in the workplace.  A 2012 report by the Human Rights Campaign Foundation found that 86 percent of the Fortune 500 companies included sexual orientation in their non-discrimination policy, and 60 percent provided health benefits to domestic partners and same-sex spouses  Lotus Development was the first major employer to offer spousal benefits to same ‑ sex partners; it was followed by many others, including AT&T, Chase Manhattan, Microsoft, United Airlines, and the Big Three automakers.  Other steps companies have taken to support their homosexual employees have included management training on sexual diversity issues, visible gay and lesbian advertising, and transgender-inclusive health coverage Exhibit 17.C 17-25