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When The Parachute Color Relates to Workers of Color

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A pink slip is never a welcome sight. But is a firing related to color? And how would we know?

Headlines abound for recent severance plans for fired CEOs as many corporations are now choosing to lighten their “golden parachutes.” Given that CEOs in the U.S. make on average $16.3 million per year, it is high time that their severance was reduced.

However, what corporations should be paying more attention to is the firings of those workers down in the ranks. Many of these employees can barely afford to stay afloat after a perfunctory severance plan and state-regulated unemployment is paid out.

And what if these firings are not justified, but are the result of discrimination or bias?

The latest Bureau of Labor Statistics data shows Black unemployment rates continue to be the highest in the country at 9.1 percent, compared to 4.6 percent for whites. Unemployment rates are 4 percent for Asians, and 6.8 percent for Hispanics.

To increase transparency, companies should either through voluntary self-regulation, or external, legislative regulation, make public the demographics of workers who are laid off.  That way, if there is any gender, race, or other, bias in “downsizing,” it would be more readily apparent.

But right now, corporations do not typically release publicly the demographics of workers who are fired or downsized.

Many in my personal network are African-Americans who work in corporations, and I’ve heard several tales of “Saturday Night Massacres” during the decession of 2008. People would come to work on Monday, and suddenly almost all the Black mid-level managers were gone.

But without real data connected to these firings, the activists pushing for inclusive workplaces, where discriminatory behavior is lessened or eradicated, are unable to definitively prove the connection.

Studies have shown that  “like prefers like,” meaning there’s a tendency for people to hire others who are similar to themselves on social status. Research also indicates discriminatory patterns regarding employment termination of Black people.

Several years ago, I was laid off from my job in marketing research. What I believe happened is that the boss, knowing that a layoff was coming, rated me lower than I deserved on my performance evaluation.

As a recent graduate, I’d done OK the first year in the job and my rating reflected that. The second year, I performed at a higher level as I made significant contributions to our clients. Yet, I received a slightly lower rating.

I was the only Black person in the group. My belief is that my boss and her boss wanted to save the jobs of the department members who were more similar to them (i.e., white), and manipulated a comparatively low score for me so that I’d be pushed out and my colleagues could stay.

It may be adding to human resource departments’ workload to create such standardized reports. But what is more important is ensuring that people are not unfairly cut off from the lifeline of a salary.

A powerful precedent exists in the movement to make pay transparent by gender as a way to close pay disparities. This movement has been justified by quantitative evidence that women, as a whole, make less than similarly-situated men.

Similarly, unemployment statistics point to the over-representation of Black workers on the unemployment roll. In particular, Blacks have been shown to suffer inordinately from the decession of 2008.

Either business organizations should voluntarily police themselves by releasing these statistics, or legislators and the Bureau of Labor must require corporations to release these data.  It is too easy to get away with getting rid of those who are not part of “in” groups during mass layoffs.

Without this accountability, a major segment of the workforce will continue to be disadvantaged and the country as a whole will suffer from lost talent.

And that is just not fair.

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Katherine Giscombe is a social scientist working on issues of women of color for more than 15 years. She holds a Ph.D. in Organizational Psychology from the University of Michigan and is a participant in The OpEd Project’s Greenhouse at the Center for Global Policy Solutions.