ECO336 Women in the US Economy Week 7 Political Responses to
Labor Market Issues Slide 2 Outline of Presentation I. Why
Government Intervention? What are the market failures? II.
Remedies: Efficiency versus Equity? III. Civil Rights Legislation
IV: Affirmative Action V: Family Friendly / Work-Life Balance VI.
Evaluation of Affirmative Action VII Evaluation of Family Friendly
/ Work-Life Balance VIII: What did this presentation ignore? Slide
3 Government Intervention in Free Markets Why? When? How Much? Now
THAT Is the Question! Overview of Market Failures Slide 4 Market
Failure in Discrimination? Discrimination deriving from a source
that is self- perpetuating, unless some new procedure forces
change. Government intervention is needed as a way to break the
vicious circle the firms management is forced to institute
selection procedures that short-circuit individual managers and
workers prejudices. Slide 5 Equity Versus Efficiency Tradeoffs Not
Tradeoffs Slide 6 Equal Opportunity versus Outcome Discussion Slide
7 The First Step: Executive Order 8802 President Roosevelt, June
1941: the first time that the U.S. government has took action
against discrimination in employment. The policy declared it to be
the policy of the United States that there shall be no
discrimination in the employment of workers in defense industries
or government because of race, creed, color, or national origin.
Govt Contracts Committee on Fair Employment Practice Note: this did
not address employment discrimination against women, but it got the
ball rolling. Slide 8 The Second Step: Civil Rights Act 1964 Title
VII... It shall be an unlawful employment practice for an
employer(1) to fail or refuse to hire or discharge any individual,
or otherwise to discriminate against any individual with respect to
his compensation, terms, conditions, or privileges of employment,
because of such individuals race, color, religion, sex, or national
origin; or (2) to limit, segregate, or classify his employees or
applicants for employment in any way which would deprive or tend to
deprive any individual of employment opportunities or otherwise
adversely affect his status as an employee, because of such
individuals race, color, religion, sex, or national origin. Slide 9
What that does: Allows an employer to bring a lawsuit and collect
damages if the court decides discrimination has occurred.
Class-action suits can be brought on behalf of a group of employees
Equal Employment Opportunity Commission (EEOC): receives and
investigates complaints of discrimination. Slide 10 What Practices
are Discriminatory? Title VII, like other laws passed by Congress,
is broadly drafted. It has been left to the EEOC, subject to review
by the courts, to define what behavior is discriminatory and what
is not, and to set the nature of the evidence to be required as
proof of discriminatory behavior. What follows is a list of factors
that the courts have ultimately defined as discriminatory and
otherwise okay business practices. Slide 11 BFOQ Title VII
prohibits employers from classifying people according to sex, race,
religion, or national origin, and treating them differently for
those reasons EXCEPT IN THIS CASE: The framers of the Act
recognized that the sex, religion, or national origin (but not
race) of employees might in special circumstances be a legitimate
concern of an employer. Ex: a group of Catholic nuns running a
religiously oriented girls school to hire men or non-Catholics as
teachers. Slide 12 What does BFOQ mean? The language of the Act
gives an exception to the requirement of nondiscrimination in the
instances where religion, sex, or national origin is a bona fide
occupational qualification reasonably necessary to the normal
operation of that particular business or enterprise. Slide 13
Landmark Case Claudine Cheatwood charged that her employer South
Central Bell Telephone had discriminated against her by refusing to
consider her or any women for the post of commercial
representative. Main duties: visiting customers premises, dealing
with financial matters, complaints and delinquencies. Sometimes
collect coin boxes that could weigh up to 90 lbs. Slide 14
Statistical Discrimination When an employer uses suppositions or
even facts about womens average ability as compared to mens in
coming to decisions about the hiring, assignment, or promotion of
individual women. Consider candidates individually, rather than
relying on its view that a group of people are on average less
qualified for a job. People have the right to be considered on
their own merits and not to be disadvantaged by their membership in
a group that on average performs relatively poorly. Slide 15
Pensions Some employers were running pension plans under which the
monthly payments to retired women were as much as 20 percent lower
than those to men with equivalent service, on the ground that women
on average live longer than men. Slide 16 Customer Preference
Employers accused of discrimination have argued that they should
have the right to exclude women from certain jobs on the grounds
that their customers or their other employees would rather have men
on the job. The courts have ruled consistently against such a
connection. Slide 17 Protective Legislation 19 th and early 20 th
centuries, many of the states passed so- called protective laws
which forbade women from working at a long list of jobs or working
long hours at night. The principal supporters of laws restricting
the use of womens labor were male-dominated labor unions who wanted
to exclude womens competition for jobs that men wanted. Courts have
concluded that such laws conflicted with the policy of
nondiscrimination mandated by Title VII, and declared them all
invalid. Slide 18 Tests or Requirements for Employment The courts
have severely limited the right of employers to make candidates
pass tests or require them to have specified characteristics as a
condition of employment. Unless a test is expressly and closely
related to the duties of the job in question, an employer cannot
use it if it has the effect of excluding a disproportionate number
of women or black candidates (disparate impact). Ex: Duke Power
Company suit brought by a group of black workers. Cast doubt on
height and weight requirements which had the effect of excluding
women from male- dominated jobs such as that of a police officer.
Slide 19 Seniority Systems Seniority systems have caused women
workers considerable disadvantage due to prior discrimination.
Slide 20 Sexiness On the Job The courts have generally been
unsympathetic to employers (at least those not in the business of
directly selling sex or entertainment) who have required that women
employees look attractive and available to make customers, while
making no such demands on males in similar jobs. Slide 21 Pregnancy
Historically: some employers routinely terminated any employee who
became pregnant. Others have required prolonged leaves without pay,
with little or no guarantee of reinstatement to a comparable job.
Pregnant employees have been denied the use of paid sick leave
during their period of disablement and of health insurance coverage
for bills associated with the pregnancy. First legal attacks on
employers pregnancy policies were brought by teachers in public
schools who were being required to retire from the classroom upon
discovery of their delicate condition. Slide 22 Sexual and
NonSexual Harrassment 1980 the EEOC issued a ruling declaring this
to be a violation of Title VII. Slide 23 Affirmative Action: The
Current Order in Force Issued by President Lyndon Johnson in 1968:
requires firms that sell any kind of product or service to the
federal government to formulate and implement affirmative action
plans for getting women and minority persons into jobs from which
they have been excluded. This is essentially affirmative action as
we know it. Slide 24 What is Affirmative Action? Technique of
personnel administration which creates a plan for integration a
plan that includes goals and timetables. Essentially firms need to
compare their existing pool of employees (or applicants) the
potential pool of qualified individuals. 4/5 Rule: A selection rate
for any race, sex, or ethnic group which is less than
four-fifths... Of the rate for the group with the highest rate will
generally be regarded by the federal enforcement agencies as
evidence of adverse impact. Slide 25 Pros of AA Policies necessary
to offset the systematic barriers that minorities and women
continue to face in pursuing education and employment opportunities
Here discrimination and pernicious stereotypes have persisted into
the present while the cumulative effects of past discrimination
also continue to hobble underrepresented groups in a variety of
ways. AA is needed to equalize opportunity. The women and
minorities who benefit are qualified. AA has positive externalities
on everyone. Slide 26 Cons of AA Discrimination (past or present)
now plays a relatively small role in the determination of
educational and employment differences across race or sex.
Weaknesses in early family and school environments that continue to
generate low skills among underrepresented minorities, which in
turn generate lower representation and poorer performance in
highly-paid jobs and university positions for these groups. AA is
an attempt to equalize results or outcomes, not opportunity. Gets
unqualified people into jobs, displaces qualified. Mismatches.
Slide 27 Family Friendly / Work-Life Balance See Case Study. Slide
28 Evaluation of Affirmative Action Empoyment of black males grew
about 5% faster at contractor establishments in the critical period
of1974-80, while for females and black females the effects were
somewhat more modest. Redistribution of employment occurs across a
wide range of occupational categories, implying that the benefits
of AA are widely spread among blacks and not just limited to more
educated professionals and administrators. The share of total
employment accounted for by white males was about 15-20% lower in
AA establishments. One study found no evidence of weaker
credentials or performance among females in the AA sector, relative
to males within the same racial groups. Comparing minorities to
whites: clear evidence of weaker educational credentials but
relatively little evidence of weaker performance. Slide 29 More
Evaluation of AA Firms engaging in AA might offset the productivity
shortfalls that would otherwise be expected among those hired from
protected groups. Why?? 1. recruit more extensively Screen more
intensively Provide more training after hiring Evaluate worker
performance more carefully. Slide 30 Evaluation of Family Friendly
Cost-Benefit Analysis Bad for Women: Bergmann: Watch out For Family
Friendly Policies Unfair to the Childless; See Elinor Burkett, the
Baby Boon
