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The Future of Affirmative Action for Private Employers: How to Protect Your Organization from Unwarranted Discrimination Claims

February 6, 2024

A 2022 U.S. Supreme Court ruling essentially put an end to the use of affirmative action programs in college admissions, opening the door for similar rulings for private employers. Understanding what this could mean for your organization could help you protect it in the long run against claims of discrimination.

Since the Civil Rights Act of 1964, employers have adhered to affirmative action policies, which were created to improve opportunities for Black Americans and prohibited businesses that received federal funds from discriminating against Black Americans. Monitoring agencies like the Equal Employment Opportunity Commission made sure the Civil Rights Act was followed.

Affirmative action policies later expanded to provide protections to women, indigenous people, Hispanics and other minorities, and were extended to colleges, universities, states and federal agencies.

However, these policies are now being challenged and employers need to protect themselves from wrongful allegations of discrimination.

Your organization might be like many that launched Diversity, Equity & Inclusion (DE&I) initiatives and practices in recent years to replace affirmative action. Still, there is more you can do.

  • Create employment policies that are broader and inclusive of your staff.
  • Review and update job descriptions and the employee handbook to remove potential biased wording from company documents.
  • Evaluate your interview and hiring process to eliminate any potential bias.
  • Create and nurture an environment that is open and inclusive for all employees.

An Employment Practices Liability (EPL) policy can further help defend against potential claims brought by employees. Policies differ in language from carrier to carrier. Coverages available under the definition of “Wrongful Act” in most EPL policies are claims alleging discrimination, retaliation, deprivation of career opportunities and negligent hiring.

Most Employment Practices Liability policies offer a library of risk management information from your insurance carrier that includes tips on hiring practices and sample employee handbook policies.

Affirmative action claims have increased in the past five years and have drawn closer scrutiny from carriers.

The experienced team at Oswald can conduct an annual review of your employment handbook and general hiring practices to be sure that you are isolating your company as much as possible from potential claims. We can also review your EPL policy and limits to ensure you have the right coverage for your needs.

For more information, please visit our Property & Casualty page or contact us below.

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