Yesterday the Nashville Area Chamber of Commerce sent a letter to the Metropolitan Council about BL2011-838, the Contract Accountability Non-Discrimination Ordinance, in which they called for deferral and listed some of their questions and concerns about the bill.
Deferral: The question of deferral is a matter for the judgment of the bill sponsors. It appears, however, that the window for that opportunity is closing fast if it hasn't already. We are also working against the clock on advancing the legislation ahead of Rep. Glen Casada's bills that would prevent cities from enacting such ordinances. Regardless, it is worth noting that there would be over a month between second and third reading of the bill (if the bill advances) in which to get answers under the current calendar. So I hope we can continue the education process throughout the bill's discussion.
Members of the Chamber board can get the answers the Chamber requests: It should be pointed out that regardless of when or whether the bill moves forward, there are ample resources for answering the Chamber's questions. Since there are members of the Chamber's board from AT&T, Loews Vanderbilt Plaza Hotel, Deloitte, Bank of America, and Vanderbilt University (employers that already have inclusive job protections), the Chamber can consult their human resources departments. If the issues that the Chamber raises are difficult or insurmountable issues for business, it seems that their own leadership would be able to address them.
Looking at the questions: The Chamber asks 9 broad questions about the bill. But one thing that should be pointed out is that many cities and many Fortune 500 employers have already adopted these policies. Metro Councilman Jamie Hollin notes this in his open letter to the Chamber. For those unfamiliar with the ordinance, the Chamber's letter might lead some readers to believe we are, to use an overwrought phrase, reinventing the wheel with this legislation, but we have abundant experience with this legislation across the United States to know that it does not have a negative impact on business. As an addendum, I would like to see the Chamber ask some questions about the potential benefits for attracting talent to our city that the legislation provides. The work of Richard Florida is a touchstone on this point. But here are the Chamber's questions and observations.
1. The first question deals with complaints of discrimination in the procurement process. The question seems to be that since sexual orientation and gender identity are not federally protected classes (they are in hate crimes legislation in federal government employment, but not in private employment) that some new structure would be needed. And then they ask whether there would be safeguards from frivolous complaints. Our answer is that the existing process would work just fine. The legislation only adds two categories. It doesn't alter the process for assessing procurement. If a vendor is found to have discriminated, then the question is whether the contract with Metro continues, not whether the employee of the vendor needs a new structure to address a complaint. The ordinance is not blanket non-discrimination ordinance for the entire city and all its private employers; it is only another set of factors in determining which ones may bid for Metro contracts.
2. The Chamber observes that sexual orientation and gender identity are not defined in the ordinance. Race, sex, religion, etc. are also not defined in many Metro ordinances. Sexual orientation means whether one is heterosexual, homosexual, or bisexual. Gender identity means the gender with which you identity. Some people identity as male and some identity as female, regardless of the gender they were assigned at birth. Again, I would note that this is how the companies that make up the Chamber's leadership would use the terms. The answers are readily at hand. What ought to be important is that people are sometimes discriminated against on these grounds and that vendors doing business with Metro tax dollars should not be using these categories as a basis to discriminate.
3. The Chamber addresses the issue of communication about the ordinance and the need for community education. They request data about other cities and what resources exist in Nashville. First, I would say that community education can continue if the ordinance passes. Some community education has been going on for quite some time now. The city had a vigorous discussion of some of these issues in 2009 when the non-discrimination ordinance was passed. And since the Belmont University story broke in December, these issues have been in the media every week. And finally I would say that gathering the information for this education is not difficult. As we have noted, the Chamber has the resources of its board members whose companies have these policies and do business in jurisdictions where such ordinances exist. Furthermore, one can look at the experience of Metro Louisville, a city that has a comprehensive non-discrimination ordinance that applies to the private sector. That city's most recent Human Relations Commission (the entity that helps certify city vendors) report indicates that there were few complaints based on sexual orientation and gender and almost no complaints in any category including race, religion, etc. that escalated to litigation. The research burden is not difficult given so much experience across the country.
4. The next question deals with "disruption" in the workplace and costs, although no specific instances from any other jurisdiction that has the policy are cited. Again we would say that the Chamber can ask its board members whether there is a cost and whether disruptions result. And again, we would ask whether small disruptions and costs are worse than the practice of discrimination? Then further down in this section they ask some more specific questions related to implementation:
*What do smaller companies do that have fewer than 25 employees but no dedicated HR person? I believe there is willingness among the sponsors to look at an exemption for smaller companies. But even if the bill is not amended to exempt smaller companies, the bill does not require companies to change their written policies. It only asks them to sign an affidavit saying they don't and won't discriminate based on sexual orientation and gender identity. It doesn't require a "sophisticated human resource staff" to comply.
*How do companies balance religious beliefs with the issue of sexual orientation and gender identity? First, there is an exemption for religious organizations in the text of the ordinance. Second, employees have first amendment rights to express their religious beliefs as long as they don't disrupt the workplace, and reasonable accommodations must still be made for them. They just can't take sexual orientation and gender identity into account when they hire, fire, promote, or discipline while they're using taxpayer money to do work for Metro.
*What physical workplace changes are needed for transgender employees? None. Transgender people use the bathroom just like everyone else. Metro government did not add or alter restrooms when the 2009 non-discrimination ordinance was adopted.
*Will employers need to offer partner benefits? No, Metro doesn't do that now and there is nothing in the ordinance requiring partner benefits.
5. The proposed ordinance will continue to expand Metro policies beyond what is currently required under state and federal law which could introduce many situations where the effect of the policy will overlap with actionable claims, albeit under different legal causes of action. The point is not clear. The ordinance does go beyond the state and federal procurement process and beyond state and federal law in terms of defining protected classes in employment. But the ordinance does not create a new cause of action. The issue for the employer and Metro (if the employer discriminates) is whether the contract continues. Furthermore, it is possible to have overlap with actionable claims under state and federal law and Metro law now since all three include sex, race, religion, etc.
6. Is there a minimum number of employees a vendor must have in order to fall within the scope of the ordinance? The ordinance can be amended to set a minimum, but even if that doesn't happen, an employer doesn't have to change his or her written policies. All that is required is signing an affidavit saying that the employer will not discriminate in hiring, firing, etc. based on sexual orientation and gender identity.
7. It's not "readily apparent" that someone is gay, lesbian, bisexual, or transgender so it could be disputed whether an employer knew or suspected someone is "homosexual." That's true. It's also true for religion and national origin and in some cases race. The question is not what characteristics a victim of discrimination has. The question is whether the employer made hiring, firing, promotion, or discipline decisions based on sexual orientation or gender identity. In other words, I may not know someone's sexual orientation, but if I believe someone is a lesbian and I use that as the basis for firing her, then there's a problem. But the upside for employers on this point is that if they don't know someone's sexual orientation or gender identity, it may give them an additional defense in a dispute.
8. "It will be difficult for employers to determine whether it [sic] is meeting Metro's standard of providing equal employment opportunities for all sexual preferences [sic]. The ordinance covers sexual orientation, not sexual preferences. Furthermore, the ordinance is not a quota system. A company, particularly a small one, could end up not having any gay employees and still be in compliance as long as hiring decisions were not based on sexual orientation. Nothing in the text of the ordinance even hints at affirmative action benchmarks for gay, lesbian, bisexual, or transgender employees.
9. "Vague or impractical legislation could increases [sic] the cost of litigation. What is the exposure of business?" Fortunately, the legislation is neither vague nor impractical since many other cities have adopted such policies and thousands of companies have complied with such ordinances. As we have noted, the experience of Metro Louisville shows that the exposure of business to such lawsuits in all protected classes is minimal. Councilman Hollin's blog post cited earlier also demonstrates this point.
Finally, the Chamber adds points that it lists as "input from business." Here they are:
*"The legislation will inhibit the free flow of instrastate commerce of Tennessee. Metro does not need to dictate personnel policies to businesses from outside counties or encourage others to leave Nashville." First, many existing vendors already prohibit discrimination based on sexual orientation and gender identity. Second, given the size of Metro contracts, businesses will adapt to ensure their profitability. That is the experience of Louisville, Austin and many other cities that have these policies. There is no empirical indication that such policies drive businesses away. Furthermore, our city has the right to determine how its taxpayer dollars are used, regardless of where the vendor is headquartered.
*"At a time when Metro needs to get the best price for taxpayers in the provision of goods and services by its vendors and contractors, the new requirement will reduce the number of companies willing to bid, thus increasing costs to taxpayers." The answer is the same as above. Many vendors already have inclusive non-discrimination policies. Profit is a strong motivator and vendors will certainly continue to step up and bid for Metro contracts. And the experience of other cities shows that you can demand that your tax dollars not fund discrimination and still get a good deal for the taxpayers.
I hope that these answers are helpful in the ongoing discussions of this legislation.
-Chris Sanders
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