Fluent Essays

Aetna strategic focus Read The ICE Strategy on Human Resource Management (pp. 8–9) of the PDF in Aetna: Investing In Diversity Case. Also review Exhibits 6 and 7 on pp. 22–23 of the case study to see the link between Aetnas strategic focus and the diversity outcomes that can result. From Exhibit 7, select one of the eight strategic focuses and one of the 10 diversity implications that you feel relates to that focus. (This is the Discussion Post) Discuss the relationship between the two and describe three specific actions Aetna could take to accomplish the diversity implication. Include at least one citation and reference in your initial post. Respond to at least two of your classmates posts concerning their choices and suggested actions. Can you add anything to their perspective? ( I will send the classmates post later) Refer to the Discussion Rubric ( I have attached rubric please pay attention to it )for directions on completing these discussions. .1586517 Changing National Values The United States was founded on the principles of individual merit, hard work, and equality. In spite of these values, employment discrimination has a long history in the United States. Organizations that claim to offer fair treatment to employees have intentionally or unintentionally engaged in discriminatory practices. As a result, laws have been passed to ensure equality and reward individual merit and hard work. Small Business Application The Perils of Noncompliance Owners and managers of growing small businesses should consider conducting routine HR compliance assessments, either annually or perhaps each time the company reaches another significant increase in employees, for example, from less than 5 to closer to 15 employees. There are other occasions when a small firm should check its compliance as well. Eric A. Marks, a partner in charge of the Human Resources Consulting Practice at the New York accounting firm Marks Paneth & Shron, explains: Significant changes to the business, such as mergers; the retirement of senior managers; newly hired or promoted supervisors or managers who may lack HR experience; creation or revision of an employee handbook; changes in employee morale, turnover, attendance, or disciplinary problems; taking on government contracts where compliance requirements are often stricter; and major changes in state or federal regulations—any of these are danger signs. They signal that the business has a fresh need to address compliance and make sure its house is in order. In short, an HR compliance assessment reviews how well an employer is following employment, benefits, and safety laws. Fortunately, small-business owners do not have to remain in the danger zone. There are numerous HR consulting firms that not only can conduct a compliance assessment, but can also assist the owner with rectifying any noncompliant systems and procedures and train the company’s managers and supervisors to maintain them. There are even HR compliance self-assessment forms available online. Help is only a mouse-click away. Source: “New Risks to Small Businesses” Marketwire (February 28, 2011), http://www2.marketwire.com; “HR Compliance Assessment Overview,” http://www.the-arnold-group.com/hr-assessment.cfm; “HR Challenges: Compliance,” http://www.strategic-workplace-solutions.com/services/compliance. Nonetheless, discrimination still persists. The Employment Non-Discrimination Act, or “ENDA,” proposed by the U.S. Congress extends federal employment discrimination protection currently provided on race, religion, gender, national origin, age, and disability to include sexual orientation and gender identity. 3.1bEarly Legal Developments Litigation concerning discriminatory practices has been prevalent since the nineteenth century. In 1866, Congress passed the Civil Rights Act, which extended to all people the right to enjoy full and equal benefits of all laws, regardless of race. In 1933, Congress enacted the Unemployment Relief Act, which prohibited employment discrimination on account of race, color, or creed (religious beliefs). Then in 1941, President Franklin D. Roosevelt issued Executive Order 8802, which was to ensure that every American citizen, “regardless of race, creed, color, or national origin,” would be guaranteed equal employment opportunities for workers employed by firms awarded World War II defense contracts. Over the next 20 years a variety of other legislative efforts were promoted to resolve inequities in employment practices. Unfortunately, these early efforts did little to correct employment discrimination. First, nondiscrimination laws gave no enforcement powers to agencies. Laws did not specify what discriminatory practices or methods needed correction and employers were not required to comply with Equal Employment Opportunity legislation. 3.2Government Regulation of Equal Employment Opportunity Despite their shortcomings, the laws and executive orders discussed in the previous section laid the groundwork for a significant number of laws that have since been passed barring employment discrimination. Part of the reason why it is so critical for managers and supervisors to understand and apply EEO laws is that employees act as agents of their employers. If a manager or supervisor violates the law, both she and her organization can face legal consequences. The organization cannot claim that it is not legally responsible for what the manager or supervisor did. Figure 3.2 shows the various prohibited HR activities related to hiring, promoting, compensating employees, and so forth covered by EEO laws. If you think you already know what constitutes a legal or illegal employment practice, you might be surprised. Highlights in HRM 1 will test your current understanding of how equal employment opportunity laws are applied in the workplace. Figure 3.2 Prohibited Discriminatory Employment Practices It is illegal to discriminate in any aspect of employment, including: • hiring and firing; • compensation, assignment, or classification of employees; • transfer, promotion, layoff, or recall; • job advertisements; • recruitment; • testing; • use of company facilities; • training and apprenticeship programs; • fringe benefits; • pay, retirement plans, and disability leave; or • other terms and conditions of employment. Discriminatory practices under these laws also include: • harassment on the basis of race, color, religion, sex, national origin, disability, genetic information, or age; • retaliation against an individual for filing a charge of discrimination, participating in an investigation, or opposing discriminatory practices; • employment decisions based on stereotypes or assumptions about the abilities, traits, or performance of individuals of a certain sex, race, age, religion, or ethnic group, or individuals with disabilities, or based on myths or assumptions about an individual’s genetic information; and • denying employment opportunities to a person because of marriage to, or association with, an individual of a particular race, religion, national origin, or an individual with a disability. Title VII also prohibits discrimination because of participation in schools or places of worship associated with a particular racial, ethnic, or religious group. Highlights in HRM 1 Test Your Knowledge of Equal Employment Opportunity Law The following questions have been used as “icebreakers” by employers and consultants when training supervisors and managers in EEO legislation. What is your knowledge of EEO laws? · 1. Two male employees tell a sexually explicit joke. The joke is overheard by a female employee who complains to her supervisor that this is sexual harassment. Is her complaint legitimate? Answer Yes No · 2. To be covered by Title VII of the Civil Rights Act, an employer must be engaged in interstate commerce and employ 25 or more employees. Answer True False · 3. People addicted to illegal drugs are classified as disabled under the Americans with Disabilities Act of 1990. Answer Yes No · Answer4. The Equal Pay Act of 1963 allows employers to pay different wages to men and women who are performing substantially similar work. What are the three defenses for paying a different wage? 1. Merit 2. seniority 3. incentive pay plans · 5. A person applies for a job as a janitor at your company. During his interview with you, the person mentions that since birth he has sometimes experienced short periods of memory loss. Must you consider this individual a disabled person under the Americans with Disabilities Act of 1990? Answer Yes No · 6. On Friday afternoon, you tell Nancy Penley, a computer analyst, that she must work overtime the next day. She refuses, saying that Saturday is her regular religious holiday and she can’t work. Do you have the legal right to order her to work on Saturday? Answer Yes Rationale if no reasonable accommodation can be made No · 7. You have just told an applicant that she will not receive the job for which she applied. She claims that you denied her employment because of her age (she’s 52). You claim she is not protected under the age discrimination law. Is your reasoning correct? Answer Yes No · 8. As an employer, you can select those applicants who are the most qualified in terms of education and experience. Answer Yes Rationale except if under a court order No · 9. As a manager, you have the legal right to mandate dates for pregnancy leaves. Answer True False · 10. State and local fair employment practice laws cover smaller employers not covered by federal legislation. Answer True False 3.2aMajor Federal Laws Major federal EEO laws have been enacted to prevent discrimination against groups of workers most often affected by unfair employment practices. These groups are referred to as  protected classes . (See Figure 3.3). Figure 3.3Protected Classes of Employees Defined broadly, the classes include employees of a particular race, color, religion, national origin, sex, age, and those with physical or mental disabilities. Figure 3.4 lists the major and separate federal laws and their provisions governing equal employment opportunity. Figure 3.4 Major Laws Affecting Equal Employment Opportunity LAW PROVISIONS Equal Pay Act of 1963 Requires all employers covered by the Fair Labor Standards Act and others to provide equal pay for equal work, regardless of sex. Title VII of Civil Rights Act of 1964 (amended in 1972, 1991, 1994, and 2009) Prohibits discrimination in employment on the basis of race, color, religion, sex, or national origin; created the EEOC to enforce the provisions of Title VII. Age Discrimination in Employment Act of 1967 (amended in 1986 and 1990) Prohibits private and public employers from discriminating against people age 40 or older in any area of employment because of age; exceptions are permitted when age is a bona fide occupational qualification. Equal Employment Opportunity Act of 1972 Amended Title VII of Civil Rights Act of 1964; strengthens the EEOC’s enforcement powers and extends coverage of Title VII to government employees, employees in higher education, and other employers and employees. Pregnancy Discrimination Act of 1978 Broadens the definition of sex discrimination to include pregnancy, childbirth, or related medical conditions; prohibits employers from discriminating against pregnant women in employment benefits if they are capable of performing their job duties. Americans with Disabilities Act of 1990 (amended in 2008) Prohibits discrimination in employment against people with physical or mental disabilities or the chronically ill; enjoins employers to make reasonable accommodation to the employment needs of the disabled; covers employers with 15 or more employees. Civil Rights Act of 1991 Provides for compensatory and punitive damages and jury trials in cases involving intentional discrimination; requires employers to demonstrate that job practices are job-related and consistent with business necessity; extends coverage to U.S. citizens working for U.S. companies overseas. Uniformed Services Employment and Reemployment Rights Act of 1994 (amended in 1998, 2004, and 2008) Protects the employment rights of individuals who enter the military for short periods of service. Don’t Ask, Don’t Tell Repeal Act of 2010 Bars discrimination against military personnel based on their sexual orientations. Equal Pay Act of 1963 The Equal Pay Act makes it illegal to discriminate against people in terms of the pay, employee benefits, and pension they earn based on their gender when they do equal work. Jobs are considered “equal” when they require substantially the same skill, effort, and responsibility under similar working conditions and in the same establishment. However, a company does not violate the Equal Pay Act when the differences in the wages it pays to men and women for equal work are based on seniority systems, merit considerations, or the workers’ quantity or quality of production. Also, if a pay disparity between the sexes exists, employers cannot legally lower the wages of one gender to comply with the law; rather, they must raise the wages of the gender being underpaid. Civil Rights Act of 1964 The Civil Rights Act of 1964 is a landmark law that addresses discrimination in society. Title VII of the act specifically bars employment discrimination in all HR activities, including hiring, training, promotion, transfers, pay, employee benefits, and other conditions of employment. Discrimination is prohibited on the basis of race, color, religion, sex, or national origin. Title VII of the Civil Rights Act also created the EEOC to administer the law in order to promote equal employment opportunity. In response to the growing number of immigrant workers and workplace cultural and ethnic awareness, the EEOC has issued important guidelines on national origin discrimination. A “national origin group” is defined as a group of people sharing a common language, culture, ancestry, and/or similar social characteristics. This definition includes people born in the United States who are not racial or ethnic minorities. Also prohibited under the act is discrimination based on pregnancy or a medical condition related to it or childbirth. The Civil Rights Act of 1964 covers a broad range of organizations. The law includes under its jurisdiction the following: 1. All private employers in interstate commerce who employ 15 or more employees for 20 or more weeks per year 2. State and local governments 3. Private and public employment agencies 4. Joint labor-management committees that govern apprenticeship or training programs 5. Labor unions having 15 or more members or employees 6. Public and private educational institutions 7. Foreign subsidiaries of U.S. organizations employing U.S. citizens Certain employers are excluded from coverage of the Civil Rights Act. Broadly defined, these are 1. U.S. government–owned corporations; 2. bona fide, tax-exempt private clubs; 3. religious organizations employing people of a specific religion; and 4. organizations hiring Native Americans on or near a reservation. Bona Fide Occupational Qualification. Under Title VII of the Civil Rights Act, employers are permitted limited exemptions from antidiscrimination regulations if the employment preferences are based on a bona fide occupational qualification. A  bona fide occupational qualification (BFOQ)  permits discrimination when employer hiring preferences are a reasonable necessity for the normal operation of the business. Courts have ruled that a  business necessity  is a practice that is necessary for the safe and efficient operation of the organization. However, a BFOQ is a suitable defense against a discrimination charge only when age, religion, sex, or national origin is an actual qualification for performing the job. (See Figures 3.5). For example, an older person could legitimately be excluded from consideration for employment as a model for teenage designer jeans. It is also reasonable to expect the Chicago Bears of the National Football League to hire male locker-room attendants or for Abercrombie and Fitch Clothing Store to employ females as models for women’s fashions. Religion is a BFOQ in organizations that require employees to share a particular religious doctrine. National origin can also be a BFOQ if it is an actual qualification for a job. For example, to ensure the “authenticity” of the dining experience, an Asian restaurant could use the business-necessity defense to support its preference for hiring Asian American servers. The BFOQ exception does not, however, apply to discrimination based on race or color. Figure 3.5BFOQ Bona Fide Occupational Qualification Religious Preference. Title VII of the Civil Rights Act prohibits employment discrimination based on a person’s religion. Title VII does not require employers to grant complete religious freedom in employment situations, however. Employers need only make a reasonable accommodation for a current employee’s or job applicant’s religious observance or practice without incurring undue hardship in the conduct of the business. Managers or supervisors may have to accommodate an employee’s religion in the specific areas of 1. holidays and observances (scheduling), 2. personal appearance (wearing beards, veils, or turbans), and 3. religious conduct on the job (missionary work among other employees). What constitutes “reasonable accommodation” can be difficult to define. For example, in the 2012 case, Porter v. City of Chicago, the city of Chicago had tried to resolve scheduling conflicts with Latice Porter by offering an evening shift to appease her request for time off on Sundays for religious reasons. However, she wasn’t interested in this option and didn’t return to work. She was later fired for not fulfilling work responsibilities. She sued the city based on discrimination against her religion. The City of Chicago won the case. Reasonable accommodation doesn’t mean an employer must accommodate at all costs, rather it is meant as a possible benefit to the employee. Employer–employee cooperation and flexibility are often the key when it comes to employment accommodations, including those for religious reasons. The EEOC’s position is not that firms need to quash religious expression in the workplace but to make a reasonable effort to accommodate people with different belief systems. Title VII of the Civil Rights Act requires employers to make reasonable accommodations for an employee’s religious practices and observances. Zurijeta/ Shutterstock.com Amendments to the Civil Rights Act of 1964 Equal Employment Opportunity Act of 1972. The Equal Employment Opportunity Act of 1972 amended the Civil Rights Act of 1964. Two important changes were made: 1. The act’s coverage was broadened to include state and local governments and public and private educational institutions, and 2. the law strengthened the enforcement powers of the EEOC by allowing the agency itself to sue employers in court. Civil Rights Act of 1991. The Civil Rights Act of 1991 was enacted to allow employees who can prove they were intentionally discriminated against to seek compensatory monetary damages. Compensatory damages include money for emotional pain, suffering, mental anguish, and so forth. The Civil Rights Act of 1991 also states that employees who are sent abroad to work for U.S.-based companies are protected by U.S. antidiscrimination legislation governing age and disability and Title VII of the Civil Rights Act of 1964. Glass Ceiling Act of 1991. The Glass Ceiling Act of 1991 was passed jointly with the Civil Rights Act of 1991. The “glass ceiling” represents an invisible barrier that prohibits protected class members from reaching top organizational positions. The act created the Glass Ceiling Commission to study and report on the status of and obstacles faced by minorities as they strive for top-level management jobs. Lilly Ledbetter Fair Pay Act (2009). The Lilly Ledbetter Fair Pay Act states that the 180-day statute of limitations for filing an equal-pay lawsuit with EEOC resets with each new discriminatory paycheck an employee receives—not the date the employee received his or her first discriminatory paycheck as the U.S. Supreme Court had ruled. What this means is that employees can claim discrimination after years of getting unfair pay and demand to be compensated for the lost wages. Organizations therefore need to diligently and regularly examine their pay systems carefully to be sure they are equitable. Age Discrimination in Employment Act of 1967 The Age Discrimination in Employment Act (ADEA) prohibits specific employers from discriminating against employees and applicants age 40 or older in any employment area. Employers affected are those with 20 or more employees; unions with 25 or more members; employment agencies; and federal, state, and local governments. Managers or supervisors discriminate against older employees if they: · Exclude older workers from important work activities. · Make negative changes in the performance evaluations of older employees. · Deny older employees job-related education, career development, or promotional opportunities. · Select younger job applicants over older, better-qualified candidates. · Pressure older employees into taking early retirement or terminate them. · Reduce the job duties and responsibilities of older employees. Exceptions to the law are permitted when age is a bona fide occupational qualification. Amendments to the ADEA The Older Workers Benefit Protection Act of 1990 specifically prohibits employers from denying benefits to older employees except in limited circumstances. The law also allows employers to ask older employees to waive their legal rights under the ADEA in exchange for compensation such as severance packages or court settlements. As a result of the act, many firms that have downsized have been able to legally offer older employees early-retirement severance packages. However, to be valid, an ADEA waiver must be in writing, clear, and understandable, and the recipients need to be given a certain amount of time to consider the offer in the waiver. Pregnancy Discrimination Act of 1978 The Pregnancy Discrimination Act amended the Civil Rights Act of 1964 by stating that pregnancy is a disability and that pregnant employees in covered organizations must be treated on an equal basis with employees having other medical conditions. Specifically, the Pregnancy Discrimination Act affects employee benefit programs including 1. hospitalization and major medical insurance, 2. temporary disability and salary continuation plans, and 3. sick leave policies. The law also prohibits discrimination in the hiring, promotion, transfer, or termination of women because of pregnancy. Americans with Disabilities Act of 1990 Congress in 1990 passed the Americans with Disabilities Act (ADA), which prohibits employers from discriminating against individuals with physical and mental disabilities and the chronically ill. Disability discrimination charges from employees have doubled from 2005 to 2016, from 14,893 to 28,073. The law defines a disability as “(a) a physical or mental impairment that substantially limits one or more of the major activities; (b) a record of such impairment; or (c) being regarded as having such an impairment.” Note that the law also protects people “regarded” as having a disability—for example, individuals with disfiguring burns. Not every mental or physical impairment is considered a disability under the law. For example, significant personality disorders are covered under the EEOC’s “Enforcement Guidance on the Americans with Disabilities Act and Psychiatric Disabilities.” Covered personality disorders include schizophrenia, bipolar disorders, major affective disorders, personality disorders, and anxiety disorders. These impairments are characterized by aberrant behavior, self-defeating behavior, manipulation of others, and troublesome manners of behavior. However, mental impairments described as “adjustment disorders” or attributed to stress have generally not been subject to ADA coverage. Therefore, employees who claim to be “stressed” over marital problems, financial hardships, demands of the work environment, job duties, or harsh and unreasonable treatment from a supervisor would not be classified as disabled. The act requires employers to make a reasonable accommodation for disabled people who are otherwise qualified to work, unless doing so would cause undue hardship to the employer. “Undue hardship” refers to unusual work modifications or excessive expenses that might be incurred by an employer in providing an accommodation.  Reasonable accommodation  “includes making facilities accessible and usable to disabled persons, restructuring jobs, permitting part-time or modified work schedules, reassigning to a vacant position, changing equipment, and/or expense.” An example of a reasonable accommodation case is that of Minnihan v. Mediacom Communications (2015). Minnihan had a seizure disorder that barred him from driving—an essential part of his job. Mediacom offered as many accommodations as possible, such as a nondriving job in another facility, contact information of an employee who could give Minnihan a ride to work, and information on public transportation. However, Minnihan didn’t accept any of these suggestions and requested that Mediacom hire another employee to perform the driving portion of his job—but Mediacom rejected this idea. Mediacom was found to have provided reasonable accommodation. The ADA prohibits employers from discriminating against individuals regarded as having physical or mental disabilities. ESB Professional/Shutterstock Furthermore, employers cannot use selection procedures that screen out or tend to screen out disabled people unless the selection procedure “is shown to be job-related for the position in question and is consistent with business necessity” and acceptable job performance cannot be achieved through reasonable accommodation. Information and forms related to the health of employees must be kept confidential and separate from their regular personnel files. Hiring disabled individuals is not only a legal mandate, it is also good business. Employers subject to the ADA and those who value the varied skills and abilities of the disabled approach the law as a proactive business requirement. Hiring the disabled emphasizes what these individuals can do rather than what they cannot do. Two of the most comprehensive studies conducted on the ADA show that the law has had a positive effect on both business outcomes and disabled employees. Conducted by the National Council on Disability (NCD), the studies reported positive gains regarding the ADA’s four major goals: equal opportunity, full participation, independent living, and economic self-sufficiency for people with disabilities. Figure 3.6 identifies specific ways to make the workplace more accessible to the disabled. Figure 3.6 Americans with Disabilities Act Suggestions for an Accessible Workplace • Install easy-to-reach switches. • Provide sloping sidewalks and entrances. • Install wheelchair ramps. • Reposition shelves for the easy reach of materials. • Rearrange tables, chairs, vending machines, dispensers, and other furniture and fixtures. • Widen doors and hallways. • Add raised markings on control buttons. • Provide designated accessible parking spaces. • Install hand controls or manipulation devices. • Provide flashing alarm lights. • Remove turnstiles and revolving doors or provide alternative accessible paths. • Install holding bars in toilet areas. • Redesign toilet partitions to increase access space. • Add paper cup dispensers at water fountains. • Replace high-pile, low-density carpeting. • Reposition telephones, water fountains, and other needed equipment. • Add raised toilet seats. • Provide a full-length bathroom mirror. Amendments to the ADA The Americans with Disabilities Act Amendments Act was enacted in 2008 in response to court rulings that had weakened the ADA. The ADAAA broadened the definition of what constitutes a disability. The new act makes it less likely a person will be denied protection because his or her condition does not seem severe enough or because it is improved by drugs, prosthetic devices, and so forth. After the passage of the law, the EEOC filed a number of suits against companies including one that alleged that a longtime cashier with severe arthritis was denied a reasonable accommodation—a stool. The woman had used the stool for 7 years, but a new manager did not like the fact and had terminated her. Genetic Information Nondiscrimination Act of 2008 The Genetic Information Nondiscrimination Act (GINA) enacted in 2008 was passed to alleviate people’s fears that their genetic information would be misused. Under Title II of the act, employers are prohibited from requesting, requiring, or purchasing the genetic information of workers or their family members. Employers that happen to possess genetic information as a result of health insurance records must keep the information confidential and separate from an employee’s personnel files. In 2016, this act was supported with the decision in the EEOC v. Joy Mining Machinery case, where the employer was denied the ability to make post-offer medical examinations in asking prospective employees if they had family medical history of tuberculosis, cancer, epilepsy, and heart disease. Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) The Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) covers all military personnel, including National Guard members, reservists, and active-duty military personnel, who enlist either voluntarily or involuntarily during peace or wartime. Under this act, people who enter the military for a total of five years can return to their private-sector jobs without risk of loss of seniority or benefits. The act protects against discrimination on the basis of military obligation in the areas of hiring, job retention, and advancement. The law does not require employers to pay the workers’ wages while they are enlisted. Amendments to the USERRA In 2004, the USERRA was amended by the Veterans Benefits Improvement Act requiring employers to provide a notice of rights, benefits, and obligations of both employees and employers under USERRA. For their part, service members must provide their employers advance notice of their military obligations in order to be protected by the reemployment rights statute. 3.2bOther Federal Laws and Executive Orders Executive orders are used to provide equal employment opportunity to individuals employed by government contractors. Since many large employers—such as General Dynamics, Intel, Dell Computer, and Motorola—and numerous small companies have contracts with the federal government, managers are expected to know and comply with the provisions of executive orders and other laws. The federal laws and executive orders that apply to government agencies and government contractors are summarized in Figure 3.7. Figure 3.7 EEO Rules Applicable to Federal Contractors and Agencies LAW PROVISIONS Vocational Rehabilitation Act of 1973 (amended in 1974) Prohibits federal contractors from discriminating against disabled individuals in any program or activity receiving federal financial assistance; requires federal contractors to develop affirmative action plans to hire and promote disabled people. Executive Order 11246 (1965), as amended by Order 11375 (1966) Prohibits employment discrimination based on race, color, religion, sex, or national origin by government contractors with contracts exceeding $10,000; requires contractors employing 50 or more workers to develop affirmative action plans when government contracts exceed $50,000 per year. Executive Order 11478 (1969) Obligates the federal government to ensure that all personnel actions affecting applicants for employment be free from discrimination based on race, color, religion, sex, or national origin. Vocational Rehabilitation Act of 1973 The Vocational Rehabilitation Act was passed in 1973 and required private employers with federal contracts over $2,500 to take action to hire individuals with a mental or physical disability. Recipients of federal financial assistance, such as public and private colleges and universities, are also covered. In applying the safeguards of this law, the term  disabled individual  means “any person who 1. has a physical or mental impairment which substantially limits one or more of such person’s major life activities, 2. has a record of such an impairment, or 3. is regarded as having such an impairment.” Also, employment is not required when some aspect of the employee’s disability prevents that person from carrying out essential parts of the job, nor is it required if the disabled person is not otherwise qualified. In cases when people with contagious diseases are “otherwise qualified” to do their jobs, the law requires employers to make a reasonable accommodation to allow the disabled to perform their jobs. Individuals with AIDS or HIV are also disabled within the meaning of the Rehabilitation Act. However, the Rehabilitation Act does not require employers to hire or retain a disabled person if he or she has a contagious disease that poses a direct threat to the health or safety of others and the individual cannot be accommodated. Executive Order 11246 Federal agencies and government contractors with contracts of $10,000 or more must comply with the antidiscrimination provisions of Executive Order 11246. The order prohibits discrimination based on race, color, religion, sex, or national origin in all employment activities. Furthermore, it requires that government contractors or subcontractors having 50 or more employees with contracts in excess of $50,000 develop affirmative action plans; such plans will be discussed later in the chapter. Don’t Ask, Don’t Tell Repeal Act of 2010. On September 20, 2011, the Don’t Ask, Don’t Tell Repeal Act was implemented to end the ban on gay, lesbian, or bisexual persons openly serving in the U.S. military. 3.2cFair Employment Practice Laws In addition to federal laws and executive orders, almost all states and many local governments have passed laws barring employment discrimination. Referred to as  fair employment (practices (FEPs) , these statutes are often more comprehensive than the federal laws. 3.3Other Equal Employment Opportunity Issues Federal laws, executive orders, court cases, and state and local statutes provide the broad legal framework; and within these major laws, specific issues are of particular interest to supervisors and managers. 3.3aSexual Harassment Sexual harassment  refers to unwelcome sexual advances, requests for sexual favors, and other verbal or physical harassment of a sexual nature. It can also include offensive remarks, vulgar or obscene gestures, language or comments, related to one’s sex, an individuals body, or sexual activity. Both the victim and the harasser can be either female or male, and harassment can occur between individuals of the same or opposite sex. The harasser can be the victim’s supervisor, a supervisor in another area, a coworker, or someone who is not an employee of the employer, such as a client or customer. The EEOC recognizes two forms of sexual harassment as being illegal under Title VII. The first, quid pro quo harassment, occurs when “submission to or rejection of sexual conduct is used as a basis for employment decisions.” This type of harassment involves a tangible or economic consequence, such as a demotion or loss of pay. If a supervisor promotes an employee only after the person agrees to an after-work date, the conduct is clearly illegal. The second type of harassment, hostile environment, can occur when unwelcome sexual conduct “has the purpose or effect of unreasonably interfering with job performance or creating an intimidating, hostile, or offensive working environment.” Sexual harassment includes any type of behavior, comments, gestures, and actions of a sexual nature that create a hostile work environment for an employee. Photographee.eu/Shutterstock Dirty jokes, vulgar slang, nude pictures, swearing, and personal ridicule and insult create a hostile environment when an employee finds them offensive. Email, instant and text messages, and posts on social networking sites have become convenient ways for employees to sexually harass their coworkers electronically. Via a questionnaire, it is possible to test the understanding of your employees about what is and what is not sexual harassment. Highlights in HRM 2 shows some sample questions firms can ask their employees to gauge their knowledge of the topic. Highlights in HRM 2 Questions Used to Audit Sexual Harassment in the Workplace ACTIVITY IS THIS SEXUAL HARASSMENT? AWARE OF THIS BEHAVIOR IN THE ORGANIZATION? · Employees post cartoons on bulletin boards containing sexually related material. Yes No Uncertain Yes No · A male employee says to a female employee that she has beautiful eyes and hair. Yes No Uncertain Yes No · A male manager habitually calls all female employees “sweetie” or “darling.” Yes No Uncertain Yes No · A manager fails to promote a female (male) employee for not granting sexual favors. Yes No Uncertain Yes No · Male employees use vulgar language and tell sexual jokes that are overheard by, but not directed at, female employees. Yes No Uncertain Yes No · A male employee leans and peers over the back of a female employee when she wears a low-cut dress. Yes No Uncertain Yes No · A supervisor gives a female (male) subordinate a nice gift on her (his) birthday. Yes No Uncertain Yes No · Two male employees share a sexually explicit magazine while observed by a female employee. Yes No Uncertain Yes No · Female office workers are “rated” by male employees as they pass the men’s desks. Yes No Uncertain Yes No · Revealing female clothing is given as a gift at an office birthday party. Yes No Uncertain Yes No · A sales representative from a supplier makes suggestive sexual remarks to a receptionist. Yes No Uncertain Yes No The EEOC considers an employer guilty of sexual harassment when the employer knew or should have known about the unlawful conduct and failed to remedy it or to take corrective action. Employers are also guilty of sexual harassment when they allow nonemployees (customers or salespeople) to sexually harass employees. When charges of sexual harassment have been proved, victims forced out of their jobs can be awarded back pay, lost benefits, attorney’s fees, and interest charges, and they may be reinstated in their jobs. Sexual harassment involving physical conduct can invite criminal charges, and punitive damages can be assessed against both the employer and the individual offender. 3.3bSexual Orientation Nearly half of U.S. states and some cities also have passed laws prohibiting sexual orientation discrimination in workplaces. Although Title VII of the Civil Rights Act of 1964 lists “sex” as a protected class, currently no federal law bars discrimination based on one’s sexual orientation. For lesbian, gay, bisexual, transgender, and queer (LGBTQ) employees who do not work for the federal government, protection from discrimination largely comes from fair employment practice laws passed at state and local levels. The laws vary regarding the protection afforded to the LGBTQ community and those who are covered under the laws. For example, in some states, public—but not private—sector employees are protected from discrimination based on their sexual orientation. Therefore, it becomes important for managers and supervisors to know and follow the legal rights of the LGBTQ community in their geographic area. Figure 3.8 shows a list of states that have passed non-discrimination laws based on sexual orientation. Figure 3.8States with Laws Prohibiting Sexual Orientation and Gender Identity Discrimination Regardless of any state or local laws, however, the EEOC interprets and enforces Title VII’s prohibition of sex discrimination as forbidding any employment discrimination based on gender identity or sexual orientation. The commission has obtained approximately $6.4 million in monetary relief for individuals, as well as numerous employer policy changes, in voluntary resolutions of LGBTQ discrimination charges under Title VII since data collection began in 2013. Some examples of LGBTQ-related claims that EEOC views as unlawful sex discrimination include: · Failing to hire an applicant because she is a transgender woman. · Firing an employee because he is planning or has made a gender transition. · Denying an employee equal access to a common restroom corresponding to the employee’s gender identity. · Harassing an employee because of a gender transition, such as by intentionally and persistently failing to use the name and gender pronoun that correspond to the gender identity with which the employee identifies, and which the employee has communicated to management and employees. · Denying an employee a promotion because of sexual orientation. · Discriminating in terms, conditions, or privileges of employment, such as providing a lower salary to an employee because of sexual orientation, or denying spousal health insurance benefits to a female employee because her legal spouse is a woman, while providing spousal health insurance to a male employee whose legal spouse is a woman. · Harassing an employee because of his or her sexual orientation, for example, by derogatory terms, sexually oriented comments, or disparaging remarks for associating with a person of the same or opposite sex. · Discriminating against or harassing an employee because of his or her sexual orientation or gender identity, in combination with another unlawful reason, for example, on the basis of transgender status and race, or sexual orientation and disability. Regardless of how companies may feel about sexual orientation discrimination, studies have shown that prohibiting sexual orientation and gender discrimination can increase company performance. For example, one study points out that patent-based innovation increases by 8 percent in states after they adopt the federal Employment Non-Discrimination Act (ENDA) to ban sexual orientation and gender identity discrimination in the workplace. 3.3cImmigration Reform and Control Good employment is the magnet that attracts many people to the United States. However, illegal immigration is an issue of national concern at the federal, state, and local legislative levels and among employers, unions, civil rights groups, and, of course, Donald Trump. Employers must comply with the requirements of the Immigration Reform and Control Act (IRCA). The law has two employer mandates. First, all employers covered by the law are prohibited from knowingly hiring or retaining unauthorized aliens on the job. Second, employers with four or more employees are prohibited from discriminating in hiring or termination decisions on the basis of national origin or citizenship. Employers must comply with the law by verifying and maintaining records on the legal rights of applicants to work in the United States. The Handbook for Employers, published by the U.S. Department of Justice, lists five actions that employers must take to comply with the law: 1. Have employees fill out their part of Form I-9. 2. Check documents establishing an employee’s identity and eligibility to work. 3. Complete the employer’s section of Form I-9. 4. Retain Form I-9 for at least three years. 5. Present Form I-9 for inspection to an Immigration and Naturalization Service officer or to a Department of Labor officer upon request. Employers with sizable contracts with the federal government must also use its E-Verification system. E-Verify is a system that provides an automated link to federal databases to help employers determine the legal eligibility of workers and the validity of their social security numbers. Employers that do not do business with the government can also use E-Verify. Employers using E-Verify must display a copy of this poster for employees to see. https://www.uscis.gov/e-verify Employers found to have violated the discrimination provisions of the Immigration Reform and Control Act will be ordered to cease the discriminatory practice. They may also be directed to hire, with or without backpay, individuals harmed by the discrimination and to pay a fine of up to $1,000 for each person discriminated against. Charges of discrimination based on national origin or citizenship are filed with the Office of Special Counsel in the Department of Justice. 3.3dEmerging Employment Discrimination Issues Weight Discrimination Some studies show that weight discrimination, especially against women, is not only increasing but has become almost as common as racial discrimination. No federal laws prohibit weight discrimination, although the EEOC has said that morbid obesity is a protected disability under the ADA. At some point it is not out of the realm of possibility that it could become a protected class. Attractiveness and Discrimination There are no federal laws prohibiting discrimination in the workplace based on people’s attractiveness, although it undoubtedly occurs. In a survey of hiring managers conducted by Newsweek, 57 percent of them said that qualified but unattractive job candidates would have a harder time landing a job. Part of the problem of implementing a law making it legal to discriminate based on a person’s appearance would be deciding who is unattractive enough to be protected by the law. Moreover, in some instances, good looks can be a BFOQ. The modeling business is one example. Caregivers and Discrimination In 2007, the EEOC issued new enforcement guidelines to help prevent discrimination against workers with caregiving responsibilities. There are no federal statutes that prohibit discrimination based “solely” on a person being a caregiver. However, disparate treatment arises when an employee with caregiving responsibilities is subjected to discrimination based on a protected characteristic under equal opportunity laws (such as sex, race, age). The EEOC has outlined numerous scenarios it says could constitute discrimination against a caregiver. Denying women with young children an employment opportunity available to men with young children is an example. So is refusing to hire a worker who is a single parent of a child with a disability based on the assumption that caregiving responsibilities will make the worker unreliable. The EEOC provides guidelines to help prevent discrimination against caregivers. g-stockstudio/Shutterstock Discussion Rubric: Undergraduate Your active participation in the discussion forums is essential to your overall success this term. Discussion questions are designed to help you make meaningful connections between the course content and the larger concepts and goals of the course. These discussions offer you the opportunity to express your own thoughts, ask questions for clarification, and gain insight from your classmates’ responses and instructor’s guidance. Requirements for Discussion Board Assignments Students are required to post one initial post and to follow up with at least two response posts for each discussion board assignment. For your initial post (1), you must do the following:  Compose a post of one to two paragraphs.  In Module One, complete the initial post by Thursday at 11:59 p.m. Eastern Time.  In Modules Two through Eight, complete the initial post by Thursday at 11:59 p.m. of your local time zone.  Take into consideration material such as course content and other discussion boards from the current module and previous modules, when appropriate (make sure you are using proper citation methods for your discipline when referencing scholarly or popular resources). For your response posts (2), you must do the following:  Reply to at least two different classmates outside of your own initial post thread.  In Module One, complete the two response posts by Sunday at 11:59 p.m. Eastern Time.  In Modules Two through Eight, complete the two response posts by Sunday at 11:59 p.m. of your local time zone.  Demonstrate more depth and thought than simply stating that “I agree” or “You are wrong.” Guidance is provided for you in each discussion prompt. Rubric Critical Elements Exemplary Proficient Needs Improvement Not Evident Value Comprehension Develops an initial post with an organized, clear point of view or idea using rich and significant detail (100\%) Develops an initial post with a point of view or idea using adequate organization and detail (85\%) Develops an initial post with a point of view or idea but with some gaps in organization and detail (55\%) Does not develop an initial post with an organized point of view or idea (0\%) 40 Timeliness Submits initial post on time (100\%) Submits initial post one day late (55\%) Submits initial post two or more days late (0\%) 10 Engagement Provides relevant and meaningful response posts with clarifying explanation and detail (100\%) Provides relevant response posts with some explanation and detail (85\%) Provides somewhat relevant response posts with some explanation and detail (55\%) Provides response posts that are generic with little explanation or detail (0\%) 30 Writing (Mechanics) Writes posts that are easily understood, clear, and concise using proper citation methods where applicable with no errors in citations (100\%) Writes posts that are easily understood using proper citation methods where applicable with few errors in citations (85\%) Writes posts that are understandable using proper citation methods where applicable with a number of errors in citations (55\%) Writes posts that others are not able to understand and does not use proper citation methods where applicable (0\%) 20 Total 100\% Discussion Rubric: Undergraduate Rubric Case Aetna: Investing in Diversity Case By Wayne Cascio, Ph.D. StrAtegIC Hr MAnAgeMent case study Project team Author: Wayne Cascio, Ph.D. SHR M project contributor: Nancy A. Woolever, SPHR Copy editing: Katya Scanlan, copy editor Design: Blair Wright, senior graphic designer © 2009 Society for Human Resource Management. Wayne Cascio, Ph.D. Development of this case was made possible by a grant from the Society for Human Resource Management and the National Academy of Human Resources. All of the characters in the case are fictitious. Information presented was current as of the time the case was written. Any errors are solely the author’s. Note to Hr faculty and instructors: SHR M cases and modules are intended for use in HR classrooms at universities. Teaching notes are included with each. While our current intent is to make the materials available without charge, we reserve the right to impose charges should we deem it necessary to support the program. However, currently, these resources are available free of charge to all. Please duplicate only the number of copies needed, one for each student in the class. For more information, please contact: SHR M Academic Initiatives 1800 Duke Street, Alexandria, VA 22314, USA Phone: +1-800-283-7476 Fax: +1-703-535-6432 Web: www.shrm.org/education/hreducation 09-0365 © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. 1 Aetna: Investing in Diversity INtroductIoN Raymond Marcos, chief diversity officer at Aetna, is preparing to make a presentation to the company’s board of directors at its mid-December meeting. In a deteriorating economic environment that seems to be global in its reach, the board is looking to cut expenses in any way possible. To do that, it is reviewing every major company business initiative. Diversity is one such initiative, and the board wants to understand the business case for it. It also wants to see a clear plan to measure outcomes, including systems and data. Raymond knows that some of the board members are relatively new, that almost all of them are independent directors from outside the company and that they may not have a deep understanding of the historical roots of Aetna’s diversity efforts or the objectives of those efforts. At the same time, he is eager to showcase the company’s diversity initiatives and their results, both direct and indirect. The board has allocated 35 minutes for Raymond’s presentation and another 15 minutes for questions. In preparing his remarks, Raymond has assembled a wide range of information and has to decide what to include and what to exclude. Time constraints simply do not allow him to present everything he would like. Bottom line: he has to make logical arguments and a compelling case to the board to support the company’s continued investments in diversity. He has information relevant to the following issues: Company background.1. Current economic environment. 2. The business case for diversity.3. Aetna’s 2009-2011 HR strategy.4. Aetna’s values-based approach to running its business and its broad-based 5. approach to diversity. Direct and indirect payoffs from Aetna’s diversity efforts.6. 2 © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. As Raymond surveys the information, he is feeling a bit overwhelmed. He asks himself, “How am I ever going to be able to condense all of this into a 35-minute presentation?” While he is unsure of all of the details of his presentation, Raymond has a deep appreciation and understanding of diversity at Aetna. He wants to build his presentation on a long-standing belief that broadening the definition of diversity is actually an opportunity. “In the past, diversity was an employee relations issue, largely around race and gender. This was the traditional first-order view of diversity, born out of compliance and human resources. We have learned that diversity comes in many different shapes and flavors, and we have an obligation to recognize the many different ways people present to us. The beauty of diversity is the differing perspectives everybody brings to the table. Those perspectives enrich the dialog, and that, in turn, promotes better decision-making.”1 As he ponders the best way to proceed, Raymond considers the information he has collected. comPaNy BackgrouNd Aetna is one of the nation’s leading diversified health care benefits companies serving approximately 37.2 million people (17.5 million medical members, 14.2 million dental members and 10.9 million pharmacy members, some of whom fall into more than one category).2 Aetna offers a broad range of traditional and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans, and medical- management capabilities and health care management services for Medicaid plans. Aetna customers include employer groups, individuals, college students, part-time and hourly workers, health plans, governmental units, government-sponsored plans, labor groups and expatriates. Aetna’s health care network includes 4,919 hospitals, more than 843,000 health care professionals, and more than 490,000 primary care doctors and specialists. It subsumes five member companies: ActiveHealth Management, Aetna Student Health, Goodhealth Worldwide, Schaller Anderson and Strategic Resource Company. More than 35,000 employees work for the company. Of those, 31 percent are people of color and 76 percent are women. People of color hold 16 percent of management/ supervisory positions, and 11 percent of senior leaders are people of color. Women hold 64 percent of management/supervisory positions, and 30 percent of senior leaders are women. Aetna’s 2007 revenue was $27.6 billion. Exhibit 1 (located in the appendix) is a snapshot of the company’s 2007 financial highlights. © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. 3 Founded in 1853, Aetna has a long history of community involvement and leadership on employment and diversity issues. For example, 2009 is the “Year of the Woman” at Aetna, where it will celebrate 100 years of employment of women. Aetna’s diversity activities have a long history. Since 1982, Aetna has published an African-American History calendar, profiling 12 well-known and lesser-known African-Americans in a variety of fields and professions each year. In that same year, Arthur Ashe, famed tennis player and world citizen, was voted to the Aetna board of directors. Ashe was not the first African American on Aetna’s board, however; Hobart Taylor, Jr., was named to the Aetna board of directors in 1973. Aetna’s current ‘mature’ vision of diversity is a broad view that includes a wide variety of attributes that make all of us uniquely diverse from one another in some way. Exhibit 2 presents some key milestones in the company’s history. curreNt ecoNomIc eNvIroNmeNt While examining each major business initiative at Aetna, the board is well aware of global and domestic economic conditions. In 2008, widespread defaults on sub- prime mortgages triggered a global crisis in capital markets. Many of the world’s leading investment banks collapsed, credit markets tightened considerably around the globe, and governments and the private sector battled to shore up the global financial system. Following the demise of Lehman Brothers, Bear Sterns and Merrill Lynch as independent entities, the U. S. government undertook a massive bailout of troubled lenders Fannie Mae and Freddie Mac, insurance giant AIG and major banks. All 15 European countries that use the euro currency (the “euro zone”) have been in a recession following two straight quarters of declines in their gross domestic products. Governments across the world—including the UK, Belgium, France, the Netherlands, Germany, Ireland, Italy, Spain, Portugal, Iceland, Norway, Sweden, Austria, Hungary, Ukraine, Russia, China, Saudi Arabia, the UAE, South Korea, Japan and Indonesia—stepped up interventions to stem the worst financial crisis in decades. Those interventions took the form of interest rate cuts, capital injections and lending guarantees to restore liquidity, revive the ailing banking system and rebuild investors’ confidence.3 Against this backdrop, Aetna reported its financial results for the third quarter of 2008.4 Exhibit 3 presents more detailed information for the total company, and Exhibit 4 shows the performance of Aetna’s common stock from December 2000 through November 14, 2008. In summary form, third quarter 2008 results were as follows: Operating earnings n were $1.12 per share, a 15 percent increase over the prior-year quarter, in line with the Thomson/First Call mean of $1.12 per share. Net income n was $0.58 per share, a 39 percent decrease over the prior-year quarter, primarily as a result of net realized capital losses. 4 © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. Net realized capital losses n totaled $232 million after tax; capital adequacy and holding company liquidity remain strong. Medical membership n increased by 169,000 to 17.7 million. Guidance: n Full-year 2008 operating earnings per share were projected to be $3.90 to $3.95, a decrease from prior guidance due primarily to lower fourth quarter net investment income. Preliminary 2009 guidance: n Operating earnings per share were projected to increase 3 to 5 percent over full-year 2008 operating earnings-per-share guidance. This includes a projected $0.30 to $0.40 per share increase in the company’s 2009 pension expense, driven by 2008 equity-market performance. Commenting on these results, Aetna’s chairman and CEO said, “Despite the significant weakening of the U.S. economy as well as the unprecedented turmoil in the financial markets around the world, our core business performance remains solid. We continue to win in the marketplace by offering a broad range of products and providing excellent customer service. Aetna also continues to be proactive at the national and state levels in promoting the important issues of increased accessibility and affordability of health care and improved quality for more Americans. Our national presence, strong competitive position and well-conceived strategy have continued to produce solid results even in this difficult economy.” In a related comment, Aetna’s executive vice president and CFO said, “While we did incur investment losses this quarter due to the turmoil in the capital markets, Aetna is well-capitalized, with a strong balance sheet and excellent cash flows and liquidity. We expect to generate over $1 billion of excess capital in 2008 and currently have no need to raise additional capital. Our underwriting results were strong, demonstrating our continued ability to manage costs and price with discipline.”5 tHe BusINess case for dIversIty At Aetna, celebrating diversity means appreciating and valuing individual differences. In general, managing diversity means establishing a heterogeneous workforce (including white men) that can perform to its potential in an equitable work environment where no member or group of members has an advantage or a disadvantage.6 This is a pragmatic business strategy that focuses on maximizing productivity, creativity and commitment of the workforce while meeting the needs of diverse consumer groups. Aetna pursues a more nuanced definition of diversity, namely, that it is more than just gender and racial or ethnic diversity. It is also diversity of background, training, functional experience, generational identity, etc. To be sure, a mature view of diversity in corporate America requires a legitimate and sellable business case of diversity for the organization and its bottom line. An internal business case for diversity must extend beyond compliance (and the pain of fines and bad PR that non-compliance can bring) to a true strategic contribution to business growth and bottom-line results, employing the resources and market view of a diverse employee population. © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. 5 Aetna’s Employee Resource Groups (ERGs) are good examples of such contributions. Here are just a few of them: Aetna’s African American ERG served on focus groups to contribute ideas for n greater penetration of urban markets, from product design to distribution and advertising. The Telework, Caregivers and Aetnabilities ERGs serve as invaluable resources to n Aetna and strong contributors to creating a work environment that is welcoming to their particular segment while identifying external business opportunities. The Hispanic and Asian ERGs provide translation support. Documents translated n by firms that specialize in that work may get the literal word-for-word match from English, but that translation may not have the same overall message as was intended. The Hispanic and Asian ERGs know Aetna’s terms and the messages it wants to convey, so they help develop high-quality translations of the English text into similar-meaning texts in non-English languages. Gen Y ERG is helping Aetna develop a recruitment and retention strategy that n resonates with this employee segment. The Gen Y ERG also assists with marketing efforts to this younger population. Broadly speaking, there are two key drivers of Aetna’s corporate strategy to pursue diversity: (1) growth opportunities in non-traditional and other targeted growth markets (e.g., gay/lesbian/bisexual/transgender (GLBT), Asian-American business owners); and (2) the need for an organization that reflects and understands the customer base it serves. To accomplish these objectives, Aetna is taking the following steps: Creating innovative and tailored product and service solutions that will meet » customers’ unique needs. Developing a diverse supplier base that reflects the company’s multicultural » marketplace. Building a workforce that understands the communities where Aetna does » business. Fostering a culture of inclusion that attracts a diverse talent pool and recognizes » and rewards the contributions of every employee while allowing employees to do their best work. According to Aetna’s mission and values statement (www.aetna.com/about/aetna /ms/), Aetna appreciates effort but recognizes and rewards employees for achieving business results. Toward this end, Aetna uses the following metrics to assess the business impact of its diversity initiatives. 6 © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. Initiative Metric Business Impact Area Affected Local Market Initiative and Targeted Growth Markets • Number of new markets • Membership growth • Profitable growth in local markets • Local markets • Small and middle markets Supplier Diversity • Number of suppliers and amount in expenditures • Promote strong company brand • Profitable growth • Small and middle markets • Individual markets AARP • Number of new members 50 years of age and older • Profitable growth • Enterprise-wide • 50+ demographics Multicultural Investments • Money invested with minority- and woman- owned funds • Promote strong company brand • Competitive returns • Enterprise-wide Cultural Competency Training • Percentage of employees who have completed training • Promote strong company brand by understanding different population segments • Enterprise-wide Multilingual Capability • Percentage of employees who speak languages in addition to English • Percentage of materials available in languages other than English • Promote strong company brand by understanding different population segments • Increased market share • Enterprise-wide Multicultural Customer Satisfaction Index • Percentage of customers satisfied with our products and services • Promote strong company brand • Increased market share from the multicultural market • Enterprise-wide Diversity Index Gaps • Differences among employee demographic segments • Increased employee engagement and productivity • Enterprise-wide HR Recruiting/ Retention • Differences among employee demographic segments • Hiring and turnover savings • Employee satisfaction • Employer reputation and brand • Enterprise-wide Miami Advisory Council • Miami market share • Increased market share and brand recognition • Miami-Dade County Diversity Annual Report • Reports printed and distributed • Languages used • Promote strong company brand as an industry leader • Increased market share • Enterprise-wide © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. 7 Aetna’s diversity strategy is closely related to its broader HR strategy, as reflected in the overall statement of that strategy: “HR will be accountable for the advancement of a diverse, high-performing workforce to sustain industry leadership.” To operationalize that strategy from 2009 through 2011, HR at Aetna identified three key initiatives linked to business priorities and goals and tied to measurable outcomes that reflect success. An executive summary of the overall HR strategy is shown below. executive summary: 2009–2011 Human resources strategy Enterprise Strategy Statement 2009–2011 Human Resources Strategy Statement Aetna will lead the industry in providing high- quality, cost-effective health and related solutions that leverage information to meet the needs of targeted customers. HR will be accountable for the advancement of a diverse, high-performing workforce to sustain industry leadership. aetna’s Integrated Workforce-management strategy Business Priorities and Goals Key Strategic Goals Success Measures • Forecast and plan for a superior workforce to meet changing business needs, including local and targeted growth markets • Attract innovative, results- focused, diverse workforce goal #1: Workforce management Supply a qualified workforce to support near- and long-term business objectives • Effectiveness of workforce plans (e.g., timely delivery of right resources to meet business needs) • Diverse employee base that understands and reflects our constituents • Aligned systems and practices to support delivery of strategy (e.g., utilization of Talent Manager information) • Develop bench strength and career growth in critical job functions, succession plans and enterprise leadership to ensure our ability to meet challenges of our growth strategy goal #2: Leadership and key talent capabilities Identify, develop, utilize and retain talent with leadership and functional capabilities • Internal talent placement into new and expanded roles • Talent retention • Middle management and functional talent development • Diverse pipeline of internal and external talent for leadership • Career progression • Retain, engage and optimize performance of innovative, results-focused, diverse workforce • Drive profitable growth goal #3: High-Performance organization Drive employee, team and organizational performance and advance Aetna’s growth strategy • Pay-for-performance results • Diversity scorecard results • Improved employee survey results • Employee health dashboard results • Contribution to growth/sales 8 © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. aetNa’s vaLues-Based aPProacH to ruNNINg Its BusINess aNd Its Broad-Based aPProacH to dIversIty Aetna employees live by a set of core values, known as the Aetna Way, which put the people who use the company’s services at the core of everything it does. While business results are important, Aetna’s senior managers believe that how the company achieves those results—how it makes a difference for the people it serves— is every bit as important. Exhibit 5 (located in the appendix) shows the company’s four core values: integrity, employee engagement, excellence and accountability, and quality service and value. Raymond focuses on the customer-centric nature of these values—that they all revolve around Aetna’s customers. He also notes how each value is defined operationally in terms of how employees are expected to behave. Integrity: n Do the right thing for the right reason, honor commitments and behave ethically. Employee engagement: n Lead people to success, value diversity, and build confidence and pride in our company. Excellence and accountability: n Make a fair profit, innovate, anticipate the future—look, listen and learn. Quality service and value: n Make it easy. Eliminate hassles; make Aetna the standard by which others are judged; build trusting, valued relationships with all constituents. The “ICE” Strategy Aetna’s diversity strategy is a unique marriage of values and business strategy with roots from more than 35 years ago.7 Its core components are integration, communication and education (ICE). Exhibit 6 is a graphic representation of this overall diversity strategy. Integration means that all diversity components are working together across the enterprise (marketing, HR, Aetna’s philanthropic foundation, investments, procurement, sales, etc.) and that they are fully integrated into the short- and long- term business-planning process. Communication is the creation and dissemination of information to all employees and customers. Finally, education means deepening the understanding of what the diversity strategy is, its components, how it is manifested in Aetna’s business strategy, who is included, and the creation of development tools to increase individual and organizational competencies. The outcome of this strategy is twofold: (1) to serve customers in current markets more effectively while (2) identifying opportunities in new markets. It recognizes that Aetna’s future success depends on a deep knowledge of all employee segments; clear and consistent communication to disseminate information to employees, customers and other key constituents; and an increased focus on developing the cultural awareness and competency necessary to sustain its business success. To be sure, Aetna’s ICE strategy extends well beyond diversity awareness to that of a strategic advantage. © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. 9 As he examines Exhibit 6, Raymond notes that under the column heading “Integration,” Aetna’s diversity strategy supports its business goals. To illustrate this linkage in greater detail, he consults Exhibit 7, which shows the interplay between the company’s strategic business goals and the diversity implications associated with them. As for the ICE components of communication and education (of new hires, current employees and senior managers), Raymond considers some of Aetna’s major initiatives: New-hire orientation includes an overview of the diversity strategy. » The internal diversity web site includes information and resources related to » diversity, including Aetna’s mission, strategy and other resources. Aetna’s robust performance management process includes diversity-related » behaviors and competencies for all levels of employees. Aetna regularly publishes articles on different diversity topics on its intranet. » Since 2005, the company has published an annual diversity report. » Aetna sponsors a speaker series through its “Diversity in Action Lecture Series,” » available to all employees via live webcast. The Aetna Diversity Board, chaired by the company’s chief executive officers, is » comprised of Aetna executives, including its president. The Aetna Diversity Alliance, a multi-level cross-organizational group that » leverages and integrates each other’s resources to maximize Aetna’s diversity- related presence and reach, internally and externally. The Aetna Diversity Scorecard. » An annual report for Aetna’s board of directors, which captures the company’s » accomplishments related to its diversity strategy. Aetna’s chairman reports the results of diversity initiatives at quarterly managers’ » meetings and at all-employee meetings. Reporting results of key external diversity assessments and surveys such as the » DiversityInc’s “Top 50 Employers for Diversity.” Raymond identifies four diversity focus areas in Exhibit 7—namely, workforce and workplace, suppliers, marketplace, and community and professional alliances. In thinking about the best way to integrate this material into his presentation, Raymond considers how the company measures several of these important outcomes. Workforce In its 2008 and 2009 workforce, Aetna measured the representation of people of color in management, noting where it has under-representation relative to its best practice corporate and industry peers. 10 © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. Workplace Through an annual employee survey for all employees, Aetna measures the work experiences and perceptions among employees of different backgrounds. Specifically, it measures the difference in responses to two questions on the employee survey, collectively referred to as the diversity index. Any difference in responses between groups is referred to as the diversity index gap, and the company works to understand its drivers and make improvements as necessary. Examples of segments measured include: employees with and without disabilities; gay/lesbian and heterosexual employees; men and women; white employees and employees of color; and employees who work at home or in the office. These two questions ask employees how strongly they agree or disagree with the following statements about Aetna: Aetna deals with all employees fairly [an indicator of how a good manager should 1. behave]. Aetna enables people from diverse backgrounds (e.g., ethnicity, race, gender, 2. religion, age, disability, sexual orientation, gender identity) to contribute to their fullest. Suppliers Through its supplier-diversity program, Aetna actively seeks out minority- and women-owned businesses and invites them to compete for the company’s business. By tapping into different backgrounds, perspectives and experiences, Aetna enjoys several advantages. First, it gains access to high-quality goods and services. Second, it gains valuable insight into multicultural markets. And finally, it serves more effectively the communities in which its own employees live and work. Community and Professional Alliances With respect to community involvement, Aetna works diligently to build relationships with local community leaders, chambers of commerce and nonprofit organizations to gain an understanding of the health care needs in the community. It then works with those same groups to help address the identified needs. Sometimes that means reaching out to minority brokers and jointly developing community outreach strategies, as Aetna did in Chicago. Sometimes it means creating a council of business and community leaders to provide Aetna with insight and perspectives on the Hispanic community, as it did in Miami. Sometimes it means working with Chinese health care providers to ensure that Aetna’s members have access to culturally appropriate care, as Aetna did in New York. It always means working on a local level to develop an understanding of the needs of a range of communities, including African-Americans, Latinos, Asian Americans, Native Americans, the GLBT community and women-led businesses. © 2009 Society for Human resource Management. Wayne Cascio, Ph.D. 11 Incremental Costs A question that members of Aetna’s board of directors might reasonably ask is, “What additional costs does a company incur by pursuing a diversity strategy that is as aggressive and broad as Aetna’s?” The honest answer is that Aetna’s diversity initiatives are not all free, but Raymond wants to emphasize that the additional costs are really investments in the company’s long-term sustainability. Aetna has historically adopted this perspective, but given the current economic conditions, he can certainly understand why the board might question such expenditures. Additional costs include: Investments in training and education, people resources, marketing and » advertising. Funding of targeted program efforts and initiatives, such as travel budget to allow » company recruiters to visit historically black colleges and universities and Hispanic- serving institutions or gay and lesbian …