‘No good deed’ for Microsoft, others in the high-tech sector

by Leslie E. Silverman

There is a common refrain uttered by management lawyers, “No good deed goes unpunished.” Yes, it is cynical, but as employers in the high-tech sector are beginning to discover, it is often true. Currently, Microsoft is dealing with issues as a result of well-intended diversity and corporate social responsibility efforts.  Indianapolis - May 2016: Microsoft Midwest District Headquarters I

Social responsibility initiative backfires

Microsoft can tell you all about it. Last year, the company implemented a new corporate social responsibility initiative aimed at encouraging other employers to offer employment benefits to assist working families. Microsoft announced that it would do business only with large suppliers that provided certain employees with at least 15 days of paid leave annually. As a direct result of Microsoft’s initiative, which at the time drew high praise from President Barack Obama and scores of paid leave advocates, the company is now fending off charges that it engaged in an unfair labor practice.

Relying on the new joint-employer standard in the National Labor Relation Board’s (NLRB) decision in Browning-Ferris Indus. of Cal., Inc., D/B/A BFI Newby Island Recyclery, and citing Microsoft’s paid leave eligibility criteria for suppliers, a union representing employees at one of the company’s suppliers asserted that Microsoft was a joint employer and demanded that it engage in collective bargaining. Microsoft refused and is now defending itself against an unfair labor practice charge that the union filed with the NLRB.

Attempt at transparency also leads to trouble

In a similar vein, Microsoft and other employers in the high-tech industry may be questioning whether their decision to be more transparent regarding their diversity numbers will have equally deleterious consequences.

In the last few years, Microsoft and other high-tech stalwarts such as Intel, Facebook, and Amazon have chosen to publicly release internal statistics exposing the stark underrepresentation of women and minorities in their workforce. Statistics continue to show that despite their transparency, inclusion, and diversity efforts, there has been little to no improvement in the ethnic and gender makeup of this burgeoning industry’s workforce.

Now, federal policy makers are taking notice and beginning to demand action. Recently, the two federal agencies responsible for enforcing federal equal employment opportunity (EEO) laws have intensified their focus on the technology sector. In May, the Equal Employment Opportunity Commission (EEOC) held a public meeting and released a report finding that minorities and women are underrepresented within the industry, particularly in Silicon Valley.

Adding to the pressure on the high-tech industry is the U.S. Department of Labor’s (DOL) Office of Federal Contract Compliance Programs’ (OFCCP) steady targeting of industry contractors through excessive and overly demanding audits. In recent weeks, members of the Congressional Black Caucus, the Hispanic Caucus, and the Asia Pacific Caucus have also expressed concerns about minority underrepresentation in the high-tech industry. The Congressional Black Caucus went so far as to send a letter to Secretary of Labor Thomas Perez calling for increased diversity in the technology industry and demanding greater scrutiny of industry government contractors’ employment of African Americans.

Bottom line

These legal and public-policy issues perhaps were ushered into the lion’s den by the industry itself, but the high-tech sector has long been targeted by labor and minority stakeholders. It will remain so for some time as even industry critics recognize there are some long-standing and intractable educational pipeline issues that will need to be resolved to make substantial progress in high-tech-sector diversity. Despite this widespread recognition, critics will continue to turn the industry’s good deeds into ammunition for further attack. Some will insist that the punishment for the industry be harsh. The high-tech sector better be well armed.

Leslie E. Silverman is an attorney with Fortney & Scott, LLC, in Washington, D.C. You can reach her at lsilverman@fortneyscott.com.

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