Jun 23, 2020 - Economy

Why discrimination persists in the workplace

Illustration of business suit stop hand held out at woman

Illustration: Eniola Odetunde/Axios

Despite laws protecting people from workplace discrimination on the basis of race, gender, age, religion and sexual orientation — including last week's Supreme Court victory for LGBTQ workers — when it comes to actually holding firms accountable, the odds are stacked against workers.

Why it matters: The U.S. workplace is still rampant with discrimination, but the bulk of it is going unchecked as companies have figured out how to keep themselves out of court.

What they're saying: "If you look at the number of white people in the C-suite or attrition rates for African Americans or wage disparities, there's been very little change in the past few decades," says Linda Friedman, a Chicago lawyer who represented 700 workers in a race-discrimination lawsuit against Merrill Lynch in 2013.

  • "In my opinion, the most significant reason is there is no oversight," she says. "Entire industries have taken themselves out of the sight of the law," primarily through mandatory arbitration clauses.

By the numbers: Nearly 70% of U.S. employers with 5,000 or more workers have mandatory arbitration policies, according to the Economic Policy Institute.

  • "Under such agreements, workers whose rights are violated — for example, through employment discrimination or sexual harassment — can’t pursue their claims in court but must submit to arbitration procedures that research shows overwhelmingly favor employers," EPI's Alexander J.S. Colvin writes.
  • In total, around 60 million American workers don't have access to courts due to mandatory arbitration.

But even at firms that don't have such policies, pursuing discrimination cases is difficult, Friedman says.

  • "These cases are hard to prosecute even if you get to court. So much effort is spent in defeating the lawsuits," she says.
  • "It’s a real act of courage and resolve to file one of these lawsuits in the first place." Future employers can Google search you and quickly figure out if you were a plaintiff in a discrimination case — and that could work against you in the hiring process.

Rare counterexamples: Wells Fargo dropped its mandatory arbitration clause for sexual harassment claims in February, and, the same month, a former employee of PNC bank who said she was sexually assaulted by a male customer was awarded $2.4 million by a New Jersey jury.

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