Transgender and ENDA: Discrimination is Expensive

Lindsey Jacks
Programs and Policy Intern
National Council of Women’s Organizations

 

 

I recently signed up to lobby for the Employment Non-Discrimination Act for Transgendered people, and quickly realized how little I knew about the subject. Armed only with the knowledge that this kind of discrimination affects someone that I know personally, and a sense of indignation at the fact that discrimination of this sort even still exists, I began research on ENDA.

The Facts:

What I discovered was quite startling. According to the Center for American Progress, “It currently is perfectly legal in America to fire someone for being lesbian, gay, bisexual, and transgender… Rather than being evaluated on their skills, qualifications, and ability to contribute to the job, LGBT workers are all too often not hired, not promoted, or, in the worst cases, fired from their jobs solely due to their sexual orientation and gender identity—characteristics completely irrelevant to job performance. And in a majority of states and under federal law, these employees have no legal recourse to challenge this discrimination” (emphasis is my own). 29 states currently have no laws against discrimination of LGBT workers, and sadly 90% of those that identify as trans* have reported being harassed or mistreated in the work place, or they have reported having to hide who they are to avoid this discrimination.

As if this was not enough, the financial stress that discrimination places on a company is unbelievable.

The Cost:

Setting aside moral standings on LGBT issues for the moment, let us look at this from an economic point of view. According to The Costly Business of Discrimination, there’s a price to be paid for workplace discrimination—$64 billion. That amount represents the annual estimated cost of losing and replacing more than 2 million American workers who leave their jobs each year due to unfairness and discrimination.” Here is a summary of their argument:

-Let’s start with the fact that by discriminating in hiring processes, businesses are potentially ignoring some of the brightest and most qualified applicants. “Businesses that discriminate based on a host of job-irrelevant characteristics, including race, ethnicity, gender, age, disability, and sexual orientation and gender identity put themselves at a competitive disadvantage compared to businesses that evaluate individuals based solely on their qualifications and capacity to contribute.”

-Now, should a current employees be fired, the cost of replacing them is also significant. “According to a recent study, to replace a departing employee costs somewhere between $5,000 and $10,000 for an hourly worker, and between $75,000 and $211,000 for an executive making $100,000 a year.”

-Discrimination in the work place can also lead to a decrease in productivity. Employees will absorb the negative attitude within the work place, which will decrease their motivation and keep them from producing their best work, thus adding the additional costs of decreased productivity.

-On top of this, consumers have much more access to information on what a company’s policies are. Companies that are shown to have discriminatory practices are vulnerable to losing customers who would choose to do their business elsewhere, leading to yet another significant decrease in profit.

-Legal fees from lawsuits are yet another cost of discrimination. “Businesses … are also increasingly liable for discrimination suits even in states that have not outlawed gay and transgender discrimination, making discrimination economically unwise for companies in all 50 states.”

All of this adds up. Discrimination is not only wrong, but also expensive.

On top of all this, 85% of Fortune 500 companies have adopted policies to protect their employees from discrimination based on sexual orientation. In order for other companies to be competitive and keep up with the Fortune 500 giants, businesses simply cannot afford to pass on hiring the most talented applicants. Financially, it just does not make sense.

“Leveling the playing field for gay and transgender employees makes businesses more competitive, more profitable, and is ultimately the right thing to do.”

For the full article, click here:

http://www.americanprogress.org/wp-content/uploads/issues/2012/03/pdf/lgbt_biz_discrimination.pdf

 

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