Inclusive, Exclusive Or Outlawed?

Be aware of legal limits on an employers discretion in forming and working with employee affinity groups.

For many companies, workplace diversity has become a business imperative. It may be integral to their corporate identity and reflected in mission statements and annual reports, on boards of directors and in deliberations for staffing positions at all levels.

As the U.S. Supreme Court recognized in Grutter v. Bollinger, 539 U.S. 306, 330 (2003): “Major American businesses have made clear that skills needed in today’s global marketplace can only be developed through exposure to diverse peoples, culture, ideas, and viewpoints.”

At the heart of many workplace diversity initiatives are employee “affinity groups.” Broadly speaking, these are employer-recognized groups of employees who share the concerns of a common race, gender, national origin or sexual orientation—characteristics protected in some instances by law and in many organizations as a matter of company policy.

For a discussion of the strategic benefits of affinity groups, see “Employee Networks” in the June 2006 issue of HR Magazine.

Whether your organization already has committed to allowing or encouraging affinity groups or is just now thinking of doing so, remember that forming and maintaining such groups must be done within the confines of federal and state antidiscrimination and labor laws. Employers must not discriminate unlawfully in terms of the categories of employees they permit to form affinity groups, and they must take care not to negotiate with any group in a manner that might violate federal labor law.

What these two admonitions precisely mean is not altogether clear. Affinity groups have been around for decades, but very little labor or employment case law specifically addresses their fundamental legality, or definitively limits management’s discretion as to what groups to allow, who may participate and what the groups may do. Nevertheless, some basic principles of both employment law and labor law help establish certain boundaries and provide guideposts for organizations that are creating or administering such groups.

But first, let’s consider the threshold question of what it means for an employer to “recognize” or otherwise support an affinity group.

An employer may support an affinity group by granting it use of one or more of the following resources:

• Company premises. A company may recognize or endorse a group by allowing it to meet in a company conference room or other common area.
  
  
• Company time. Some employers compensate employees—hourly and salaried—for the time they spend in group meetings or for related administrative time, such as time spent planning a meeting.
  
  
• Company facilities. Affinity groups often are allowed use of the employers e-mail server, bulletin boards, photocopiers, hard mail distribution channels, paper and other supplies.

Whatever the nature or scope of the employer’s support, it should all be reflected in a written company policy or guidelines to avoid employees’ claims of favoritism and to promote transparency in creating and operating affinity groups.

The Reach of Title VII And Similar Laws

Companies considering formation of affinity groups—particularly of racial or ethnic minority groups—often ask: “Will we have to recognize a ‘whites-only’ group? What about a ‘white males’ group?”

The law, together with a dollop of common sense, provides some helpful answers to those questions. Title VII of the Civil Rights Act of 1964 and similar state laws prohibit employment discrimination on the basis of race, color, sex, religion and national origin.

It is true that Title VII and similar laws protect whites as well as blacks, men as well as women. Which means that if a company permits the formation of a women’s affinity group, it most likely would violate Title VII if it refused to sanction a men’s affinity group.

However, a company policy permitting a whites-only or a blacks-only group also would likely violate Title VII—even if the employer supported the groups merely by allowing them to meet on company property. Maintaining segregated workplace eating facilities is a classic example of discrimination in “other terms, conditions, or privileges of employment” in violation of Title VII. It follows, then, that Title VII probably prohibits establishing employer-supported groups that expressly exclude members of protected classifications.

Thus, to avoid legal liability, not to mention unproductive divisiveness among employee groups, the prudent employer will adopt an affinity groups policy that requires all employer-supported groups to be open to all employees—regardless of their race, gender or other characteristic—who support the group’s mission. That requirement would apply to a group focused on the concerns of black employees just as it would to a women’s group.

Many large companies have found that simply having a policy that requires affinity groups to be inclusive avoids the bugaboo of having nonminority employees seek approval for an affinity group.

In a different vein, employers also must be mindful of their duty to investigate harassment complaints or other dis- crimination claims that may surface during an affinity group meeting. If management is unaware of such complaints against nonsupervisory employees, then no duty to investigate or otherwise act arises. But if HR or representatives of management are present, they should encourage the employee to pursue the complaint through the employer’s usual channels. Otherwise, the employer will be considered “on notice” of the complaint and may be liable if it fails to investigate or take other responsive action.

Where Does It End?

Legal challenges to affinity groups are most likely to arise when a company recognizes some group or groups but then refuses to recognize another. Does that mean an employer that forms one affinity group is obliged to support affinity groups addressing concerns of employees in any and all protected categories? Are employers better off supporting none?

An employer’s decision to support no affinity groups is probably defensible: It treats all groups alike. That decision is not necessarily in the employer’s best interests from an employee relations and claim prevention standpoint, however. Unresolved issues and unmet needs among diverse employee groups may well surface in ways involving greater legal or business risk to the employer than would establishing guidelines for affinity group approval. Possibilities include discrimination charges, union organizing attempts, and high turnover among minority and female employees.

But where to draw the line?

The leading case in the field, Moranski v. General Motors Corp., 433 F.3d 537 (7th Cir. 2005), gives some clues as to how employers lawfully can limit the formation of new affinity groups. In that case, the 7th U.S. Circuit Court of Appeals (whose decisions are binding in Illinois, Indiana and Wisconsin) held that General Motors (GM) did not violate Title VII’s prohibition against religious discrimination when it refused to approve a proposed Christian employee network. GM complied with federal law in that it treated all groups with religious positions equally.

GM started its formalized affinity groups program in 1999. According to the facts as presented in the 7th Circuit’s opinion, the program was intended to make diverse employee constituencies feel more welcomed and valued at GM, to remove barriers to employee productivity, and to increase market share and customer support in diverse market segments.

Under the company’s affinity groups guidelines, a group had to register and to offer voluntary membership to all current full-time employees who shared the group’s goals. The guidelines expressly provided that a group could not “promote or advocate particular religious or political positions.”

Recognized groups included those for persons of African ancestry, Hispanics, Asians, Indians, persons of Chinese ancestry, persons with disabilities, women, gays and lesbians, and veterans.

The plaintiff, John Moranski, was a born-again Christian who submitted an application on behalf of a proposed “GM Christian Employee Network.” As proposed, the group would not promote a particular church or denomination. GM denied Moranski’s proposal under the terms of its guidelines.

Moranski filed suit in federal court in Indianapolis, claiming that GM had discriminated against him on the basis of religion. GM moved to dismiss the case, and the court granted GM’s motion, ruling that GM had treated Moranski no worse than any other employee of any other faith. The court specifically rejected Moranski’s position that once GM had opened the door to secular affinity groups, it could not close the door to faith-based groups without violating Title VII.

On appeal, the 7th Circuit agreed with the district court that GM had not discriminated “because of” Moranski’s religion. It treated all employees the same, regardless of their religious views; employees with any religious position could join any other recognized group, but no employee could join a group based on religion.

The 7th Circuit reasoned that Moranski’s “logic would mean that a company would violate Title VII if it recognized an affinity group on the basis of religion but not sex, or granted status to a group on the basis of sex but not to one based on ethnicity. Yet even Moranski concedes Title VII law does not stretch this far.”

Does Moranski mean that employers across the country are free to bar affinity groups on the basis of religious position? By no means. For one thing, the 7th Circuit is just one of 12 federal appellate circuits (including the D.C. Circuit), so neither its ruling nor its reasoning in Moranski is the law of the land. It’s possible that other circuits would rule differently should a similar case make it that far.

It is clear from the opinion, however, that employers cannot pick and choose among religious groups. Once an employer recognizes a Christian (or Jewish or Muslim) group, it cannot draw the line and say one or two or three is enough.

It also bears remembering that courts have long held atheism to be a religion for purposes of Title VII. See, for example, Young v. Southwestern Sav. & Loan Ass’n, 509 F.2d 140 (5th Cir. 1975). Thus, Title VII’s prohibition against religious discrimination requires employers to tolerate those who lack faith, or who firmly believe that faith is unfounded. If an employer approves affinity groups associated with any particular religious position, it probably would have to allow a group espousing atheist or agnostic beliefs.

Employers that wish to disallow religion-related groups—be they religious or irreligious—but to further reduce their legal risk outside the 7th Circuit might word their policies to exclude all groups that “promote or advocate particular belief system positions” as opposed to “religious positions.” That might seem to be a distinction without a difference, but to some courts it might make a difference.

More Line-Drawing

Let’s assume that an employer chooses to permit race- and national-origin-based affinity groups, but not gender-based affinity groups. It has approved multiple race and national origin groups and has never withheld approval from any.

A female employee seeks approval for a women’s group, but the employer refuses on the basis of its policy. The woman files suit claiming sex discrimination under Title VII.

The 7th Circuit, under Moranski, might say there is no sex discrimination as long as the employer has not authorized a men’s affinity group. But suppose the Moranski analysis doesn’t hold up in other jurisdictions. Is there any other way for the employer to defend its actions?

Just as in any disparate-treatment discrimination case, an employer might articulate an ostensibly lawful reason—limited conference room space, for example—for refusing to recognize gender-based groups.

If the employer claimed that allowing gender-based groups to meet would interfere with its legitimate business needs—such as conducting meetings with customers—the question then would be whether the employer’s explanation is but a pretext for unlawful discrimination.

Perhaps the example seems absurd, but it’s not altogether unrealistic. The employer in the hypothetical, however, might be hard-pressed to explain why it could allow eight or nine other groups to meet but not one more.

The problem of limited conference room space seemingly could be overcome by creative scheduling, using other common areas space for meetings or both. Nevertheless, the employer might retort that, if true, its reason need not be creative or even reasonable; it only needs to be nondiscriminatory.

Such is the stuff of which lawsuits are made.

Impact Of Federal Labor Law

Employers in all 50 states need to recognize the possibility that an affinity group might be held to violate the National Labor Relations Act (NLRA).

The NLRA, which applies to union-represented and nonunion employees alike, makes it an unfair labor practice for an employer to “dominate or interfere with the foundation or administration of any labor organization or contribute financial or other support.”

The NLRA defines “labor organization” broadly, encompassing “any organization of any kind ... in which the employees participate and which exists for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work.”

Whether an affinity group violates the NLRA ultimately turns on whether the group in question “deals with” the employer in such a way that the group constitutes a “labor organization.”

What does all this mean?

Affinity groups must not negotiate with the employer; that is, they must not make proposals to management involving employment terms and conditions, which management then could accept or reject, or to which management could make a counterproposal.

Affinity groups, however, would not be considered labor organizations if they are more properly characterized as “brainstorming” or “information-sharing” entities. This would make them analogous to the classic example of the suggestion box—a place where management solicits and receives multiple ideas but remains free to adopt or ignore any, and refrains from formalized give and take, or negotiation.

Consider positioning affinity groups as brainstorming or information-sharing entities by making it clear that management will consider multiple—even inconsistent—approaches to an issue of concern, but it will not entertain a group’s formalized proposal or set of proposals presented to management.

If an affinity group is a work team performing management functions, it would not be a labor organization under the NLRA.

Accordingly, groups focusing on productivity, teamwork, customer relations or public image (as opposed to work hours, pay issues, promotions or work assignments) are more likely outside the NLRA’s scope.

Condon McGlothlen is a partner in the Chicago headquarters office of Seyfarth Shaw LLP, where he advises employers on equal employment policies, practices and systems.

Web Extras

SHRM article:
Employee Networks
(HR Magazine)

Employers may bar religious affinity groups
(HR News)

SHRM web page:
Workplace Law Focus Area home page