Wednesday, February 20, 2008

Is 15 or less fair?

In class today, Prof. Prenkert said how businesses with fewer than 15 employees are exempt from the rules of Title VII (our class book also said they were exempt from the Americans with Disabilities Act).

I know a few of you gave an example of why it is OK, but I still found myself shaking my head in confusion. I do not think it should matter how many employees a company has, they should still be liable to not discriminate and follow laws pertained to larger organizations. Should those companies be able to discriminate based on race, color, religion, sex, or national origin because they have 15 employees and not 16? It just does not add up to me!

I would be really interested to read opposing views. Examples? Devils Advocates?

So, what do you think?

6 Comments:

Blogger wtravis said...

Quick Comment: You think all companies should be treated the same in the eyes of the government? What about tax cuts for small businesses?

7:43 PM  
Blogger Student said...

I agree that regardless of whether a business has more or less than 15employees it should treat its employees with respect. However, I do believe there is some logic for not applying Title VII to small businesses for two of the main reasons discussed in class: 1) the exclusion protects minority-run, small businesses and 2) since the act is from the federal government applying it to very small businesses would most likely violate the Commerce Clause.
Here’s a quick example of how not applying Title VII to a business of less than 15 employees can benefit a minority group.

A Tibetan family wants to start a small restaurant in Bloomington. While the restaurant serves Tibetan dishes, the family does not claim that the restaurant create “authentic” dining experience. It simply provides good food at an affordable price. Because of increasing popularity, the family needs to hire more wait and cooking staff. It places an ad in the Herald Times. Upon doing so the family receives several applications from Korean and Tibetan IU students. Feeling a particular fondness for people of their same national origin and since the students are new to Bloomington, the family decides to hire all Tibetan students, despite the Tibetan students having equal or perhaps worse qualifications than the Korean students.

If title VII were to apply to this small business, choosing Tibetan students based on their national origin would be illegal. But one could argue that by hiring the students, a protected group, the family was giving them an opportunity for employment, they might not otherwise have therefore meeting the objectives of the Civil Rights Act.

While my example might not be the best it does demonstrate how small businesses could benefit minority job applicants. But, the more I think about this issue, the more frustrated I get. I dislike my argument because there are many ways to poke holes in it. Such as “Well, what if the Korean students really needed jobs, they were more qualified and the job offered by the Tibetan family was the only one in town.” In that case you’d be hurting one minority at the expense of another. Furthermore, while hiring discrimination might not be that bad, what happens if an employer harasses and employee, the harassed employee has no recourse. Not applying the protections of Title VII just doesn’t seem right.

So, in order to make a stronger argument, I have to fall back on the technicality of the Commerce Clause of the Constitution. “The Congress shall have power . . . To regulate commerce with foreign nations, and among the several states, and with the Indian tribes” (Article I, Section 8, Clause 3). “Congress” refers to the Federal government. The Federal government therefore, does not have subject-matter jurisdiction in the regulation of interstate commerce. It is pretty reasonable to say that a small business of less than 15 employees (mom and pop ice cream stores, florists, etc.) would not do business outside their states, thus any regulations on their activities must be a matter of the State government.

Still doesn’t feel right does it? I’ve done a lot of Googling to see if there were any other thoughts on the issue but I came up short. I guess Title VII is what it is. It helps a great majority of people, but in order for it to help even more it will take State legislation.

Hope we can continue the discussion…

9:34 AM  
Blogger Dylan said...

This is perhaps a simple answer, but still I think a valid argument. Small businesses with less than 15 employees are just that, small businesses. It's difficult enough trying to own and run a start up business without having to worry about discrimination lawsuits. In response to Abbey's example, many small businesses are in fact restaurants and because food, as well as numerous other trades, is so suggestive of certain cultures, I think it's reasonable for small businesses to hire employees who share these cultures without fear. As far as other businesses, this can be seen as another way to encourage, or at least not discourage, people from starting small businesses. Perhaps this policy can be seen as in line with other tax and FDA exemptions for small businesses.

12:00 AM  
Blogger Student said...

Good point Dylan. I didn't even consider the most basic economic reason--to encourage economic growth via entrepreneurs. I guess the costs associated with possible Title VII litigation outweighs the benefits for small businesses. We can only hope that small businesses uphold relational contracts--preventing harassment and avoiding disparate treatment and impact.

11:04 AM  
Blogger nschutz said...

Thanks for the comments. I guess when I first read that information regarding companies with 15 employees or less, I first thought about how it is not fair that those same businesses would be exempt from harrassment claims. I really like Dylan's point about the tax and FDA exemptions for small businesses. It is funny that I did not even think about this aspect that small businesses face ... even though I have taken many business classes through LAMP. And Abbey, thanks for the information about the Commerce Clause. I guess it is not that bad after all.

7:32 PM  
Blogger Stephanie Grohovsky said...

A lot of businesses with 15 or less people probably just recruit by word or mouth and it is likely that friends, family, and acquaintances are the ones to fill the positions. Therefore, I completely understand why the 15 rule applies. The owners and management of the small business may primarily associate with only one race and they may not have the resources to recruit elsewhere. Financially, further recruiting efforts outside of friends and family members, may become too costly for a small family owned business. Dylan also has a good point when talking about how these small business would suffer severely (and could potentially close) if sued for discrimination. The small companies may not have the money to support a claim like that and in some small businesses, the individual employees may be affected financially if a lawsuit is lost because of certain types of partnerships and proprietorships (I’m not sure which ones). To protect these companies as well as the INDIVIDUAL owners and employees, the rule is put into place.

10:39 PM  

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