The Affinity Group Dilemma

Affinity Groups[i] are a popular way for companies to enhance diversity and inclusion goals. These groups provide an opportunity for employees to gather socially, share ideas, and network. They may increase productivity, boost employee morale, enhance marketing, and attract and retain employees—all objectives beneficial to corporate America.  However, Affinity Groups come with various legal and business risks for corporations, including potential employment discrimination and wage claims, unfair labor practice charges, and dissention among employees. 

However, management should decide to encourage or sponsor company Affinity Groups only after considering and taking steps to minimize possible risks.  This paper explores the creation of Affinity Groups and the potential benefits they may provide to employers; the business and legal risks that may result from implementing affinity groups; and the best practices companies should follow when implementing an Affinity Group program or deciding to sponsor Affinity Groups.

A.        History of Affinity Groups

Workplace Affinity Groups, as that term is understood today, arose out of the mid-1960’s racial tension, when Xerox CEO Joseph Wilson created a group to address discrimination in the corporate environment.[ii]  Despite good intentions, in practice management felt threatened by Affinity Groups in their initial phase and the employees for whose benefit the groups were created were reluctant to participate in the groups for fear of management retaliation.[iii]  Management’s and employees’ willingness to embrace Affinity Groups has evolved, much like the focus of corporate diversity efforts generally (by the 1980s, diversity training increasingly focused on how groups such as women and people of color were impacting the workforce, and by the 1990s the training sought to create an inclusive workplace).[iv] Despite the reluctant start, Affinity Groups today are typically seen by both corporations and their employees as a way to promote diversity and inclusion, and are often initiated by management.[v]  It is telling that ninety percent of Fortune 500 companies have some form of Affinity Group program.[vi] 

B.        The Benefits of Company-Sponsored Affinity Groups

Affinity Groups can be a “win-win” situation for the company and its employees.  From the employees’ perspective, these groups serve as a resource to network and improve their careers, to exchange ideas, and to recommend suggestions to improve their work with the company.  Employees also view Affinity Groups as a support system or network for those with similar interest.  These groups may also boost employee morale by showing that the company supports the employees’ interests. 

Many companies recognize that Affinity Groups provide an avenue to allow employees to feel more “a part” of the company.  An Affinity Group program may help attract top-level employees to the company from a recruiting perspective, and help the company retain the company’s best and brightest employees.  Federal agencies such as the Equal Employment Opportunity Commission and Office of Personnel Management view Affinity Groups as tools to promote a culture of equal opportunity, diversity, and inclusion, as well as remedy past issues, increase employee effectiveness and promote the exchange of information.[vii] 

C.        Potential Issues that Often Arise In the Context of Affinity Groups

The benefits gained by Affinity Groups are quickly negated, however, if management and employees haphazardly develop and implement the groups.  Legal risks must be analyzed when deciding whether Affinity Groups are the right choice for a company and how to successfully implement an Affinity Group program.

            1.         Corporate Legal Risks Relating to Affinity Groups

                        a.         Employers Should Treat All Like Affinity Groups Consistently.

Workplace Affinity Groups often correlate to the groups protected by the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq., commonly known as Title VII, which prohibits discrimination based upon race, color, religion, sex and national origin in employment.[viii]  Management should take caution to treat Affinity Groups within a general category consistently.  Thus, where an employer promotes an Affinity Group for Christians, it—as a general matter—should be expected to similarly sponsor other religious Affinity Groups.  

Courts, however, have found that employers have discretion to exclude entire categories of employer-sponsored Affinity Groups.  In Moranski v. General Motors Corp.,[ix] the plaintiff-employee sought to form an interdenominational Affinity Group for Christians.[x]  General Motors (“GM”) had Affinity Group guidelines in place providing that it would not support an Affinity Group that sought to promote or advocate any religious position.[xi]  GM rejected the Affinity Group application for Christians and the plaintiff filed a lawsuit alleging religious discrimination.[xii]  The District Court granted GM’s motion to dismiss for failure to state a claim, and the Seventh Circuit upheld that decision noting that GM’s “Guidelines treat employees with all religious positions identically . . . . This is not discrimination ‘because of’ religion[.]”[xiii]  

In addition to supporting an employer’s decision to exclude an entire category of Affinity Groups (as opposed to specific Affinity Groups within a category), Moranski is instructive for companies contemplating forming Affinity Groups by showing the importance of having clearly defined written guidelines on Affinity Groups programs.

b.         Employers Should Not Turn a Blind Eye to Complaints of Discrimination Raised in Affinity Groups.

Employers should consider how they will process and respond to individual concerns by employees in Affinity Groups that could be considered discrimination complaints.  In the interest of encouraging open communications and sharing of information and ideas, Affinity Groups may be tempted to set “ground rules” for meetings calling for confidentiality, i.e., “what’s said here, stays here.”  Such interests, however, conflict with management’s obligations to investigate and properly address complaints of discrimination, and with employees’ right to discuss the terms and conditions of their employment with others.

In some circumstances the law imputes knowledge of complaints to management and compels management to respond to such complaints.  Companies thus should avoid business practices or policies that hinder the expeditious communication of complaints.  The following hypothetical is illustrative: an employee participating in a Native American Resource Group meeting employee vents about her Caucasian manager who the employee claims avoids interacting with Native American employees and promotes only Caucasian, Hispanic, and African-American employees.  A manager from a different department attends the Native American Resource Group meeting, but given the group’s “ground rules” on confidentiality, fails to report the employee’s concerns to human resources notwithstanding an anti-discrimination policy’s mandate to report any and all claims of discrimination.  Subsequently, the employee who vented is terminated for performance reasons and files a charge of discrimination against the company for retaliation, claiming she put the company on notice at the Affinity Group meeting and nothing was done about her discrimination claim, which was the basis for her termination.[xiv]

Moreover, company rules requiring confidentiality may be found to infringe upon employees’ so called “Section 7” rights under the National Labor Relations Act (“NLRA”) to “engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”[xv]  The key question is whether a confidentiality policy would reasonably tend to chill employees in the exercise of their Section 7 rights (e.g., to discuss and compare wages and benefits), notwithstanding the actual good intentions or motivations for promulgating a policy.[xvi] 

To minimize possible exposure to liability, employers should remain protective of their legal interests—and the policies and practices in place to protect such interests—when implementing an Affinity Group program.

c.         Employers Should Ensure Affinity Groups Are Not Considered “Labor Unions” Under the National Labor Relations Act.

A company that supports Affinity Groups must also take steps to avoid running afoul of Section 8(a)(2) of the NLRA, which makes it an unfair labor practice for an employer “to dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to it.”[xvii] As the National Labor Relations Board states, “employees have the right to be represented by a union of their choice – not their employer’s.”[xviii]

Because the NLRA prohibits employers from dominating or interfering with labor unions, management should ensure its employees’ Affinity Groups are not considered labor unions under the law. The NLRA broadly defines a “labor organization” as “any organization . . . in which employees participate and which exists for the purpose . . . of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work.”[xix]  In turn, “dealing with” an employer “denotes a bilateral mechanism through which an employee entity and management reciprocally interact.”[xx]  Under this framework, both the manner in which an Affinity Group operates and the subject matter of an Affinity Group’s focus will determine whether management’s support of such groups are lawful.

With regard to the manner of operation, employers should be wary of Affinity Groups that work bilaterally with management by representing employee interests. In contrast, unilateral mechanisms such as “suggestion boxes,” “brainstorming” groups or meetings, or “analogous information exchanges”[xxi] are not considered to “deal with” an employer and would not run afoul of the NLRA.  With regard to subject manner, Affinity Groups that concern themselves with human resources-type issues relating to the terms and conditions of employment (as opposed to broader issues such as marketing, community outreach, and the like) expose themselves to unfair labor practice charges (and the accompanying expense of defending a charge and complaint or subjecting themselves to the onerous terms of a NLRB settlement agreement).  

Even the best-intentioned practices may be found to violate the NLRA.  Management may have very good intentions in wanting to address employee concerns that are raised at Affinity Group meetings, but management may struggle to distinguish between concerns raised by the Affinity Group that address the group’s purposes and general employee concerns that just happen to be raised by members of the Affinity Group.  Consider the following hypothetical: a company decides to sponsor the Arabic Employee Resource Group to foster better relations with its Arabic employees.  To encourage participation, the company pays Affinity Group participants for the time spent in meetings, gives the participants access to the company’s email servers and lunch room, and provides lunch to the group when they meet.  Affinity Group members raise several issues, including modifying work schedules of the participating employees to accommodate those in the group that need to fast and pray during Ramadan, as well as having the company provide “bonuses” to employees who successfully recruit new employees to the company.  In an effort to address the Affinity Group participant’s concerns, company management and Affinity Group leaders engage in a series of meetings to discuss the concerns, how the company will address those concerns and the parties come to a “meeting of the minds.”  The Affinity Group members document their understanding and provide it to management for their comment.  After managements’ review, the Affinity Group leadership publishes the final document to the members of the group.  Here, despite management’s best interests, because of the manner in which the Affinity Group engaged with the employer and the subject matter of the engagement, the company opens itself to an unfair labor practice charge alleging unlawful interference with a labor union.[xxii] 

d.         Affinity Groups May Bring About or Hasten Communications About Perceived Workplace Inequalities, Including Perceived Differences in Pay.

Management should also take into account the consequences of opening channels of communication by promoting Affinity Groups.  One of the greatest benefits of Affinity Groups is to allow employees to discuss both internal and external issues to improve the company.  Although, as previously discussed, the company should avoid directly “dealing” with the Affinity Group on a pay equity issues, Affinity Groups may foster discussions about perceived inequalities or even lead to potential class action.  

Consider the following: a Women’s Affinity Group formed to promote the recruitment and retention of women in business and to address issues unique to women in the workplace.  One of the first topics discussed is pay inequity and the glass ceiling, and after a series of discussions and research, the group discovers that women at the company are being paid approximately eighty percent of the pay for men who do the same work.  The New York Women’s Affinity Group contacts the Chicago Women’s Affinity Group to discuss the pay inequity concern, and learns that the inequity exists for women at the company in both of these markets. The women bring their concerns to management and want it corrected or they threaten to bring an Equal Pay Act (“EPA”) class action suit under the FLSA.

This scenario is almost identical to that in Schengrund,[xxiii] where a group of Penn State professors formed a “Women’s Faculty Group . . . to address the specific concerns of female faculty[.]”[xxiv]  One of the first issues identified by the group was pay inequality, and after research uncovered the pay inequality, the group brought the issue before the Dean who promised to make salary corrections.[xxv]  When the pay increases failed to meet the group’s expectations, they filed an EPA[xxvi] class action suit under the FLSA.[xxvii]  While the parties ultimately settled the lawsuit,[xxviii] Schengrund highlights the potential FLSA threats companies may face by creating Affinity Groups.  We should note that an EPA lawsuit could be brought by employees at any time against the company, but the development of Affinity Groups may be the impetus for such a claim.

e.         Compensation for Participation in Affinity Groups.

Companies may run afoul of the FLSA when they allow both exempt and non-exempt employees to participate in Affinity Groups, but do not pay non-exempt employees for time spent on Affinity Groups.  The FLSA requires that:

Time spent in work for public or charitable purposes at the employer’s request, or under his direction or control, or while the employee is required to be on the premises, is working time.  However, time spent voluntarily in such activities outside the employee’s normal working hours is not hours worked.[xxix]

If the company does not plan to pay non-exempt employees for their time spent with the Affinity Groups, the company should clearly provide in its guidelines that participation in Affinity Groups is entirely voluntary, and activities associated with such groups should take place outside the employee’s normal working hours. 

            2.         Additional Risks

Companies face additional risks when sponsoring Affinity Groups, including (but not limited to): Affinity Group members who attend meetings just to complain about the company, which may negatively affect the company and employee morale;[xxx] or overaggressive management who dominate the Affinity Group meetings, which stifles employee participation and defeats the corporate objective for forming the group.

Because the potential risks of implementing Affinity Group programs may outweigh the benefit, companies should not light-heartedly decide to sponsor Affinity Groups.  We provide the following best practices for consideration when deciding whether to implement Affinity Groups.

D.        Best Practices when Considering and Implementing Affinity Groups

            1.         Set Forth Clear, Written Guidelines

The company should develop written guidelines prior to the formal creation of company-sponsored Affinity Groups.[xxxi]  Those guidelines should provide uniform criteria for determining when the company will recognize (or not to recognize) Affinity Groups, whether recognition must be renewed and the process, reason an Affinity Group may lose company recognition, the support provided by the company to the Affinity Group, and whether the company will support the group financially.  Setting bright line policies in advance for employees and management to follow will help prevent confusion for the Affinity Groups and potential lawsuits. 

2.         Require Affinity Group Applications to Reflect the Company’s Values, Goals and Objectives

Affinity Groups should align with the company’s business values, goals, and objectives as provided in the group’s application to the company for recognition.  Although the application will be individualized for each company, as a general practice, the application should require the group to provide a mission statement or charter that explains how the group’s objectives align with the company’s business goals; how the Affinity Group will be structured and organized; list the group’s leaders, how they were selected and when and how they will be replaced; and, if required by the guidelines, the name of the  upper-level executive who sponsors the group. 

The application allows the company to recognize groups with objectives, consistent with corporate values and also serves as a guide for future employees responsible for ensuring that the Affinity Group adheres to its objective.    

            3.         Promote Openness and Ensure Participation is Voluntary

A primary objective of the Affinity Groups is to promote diversity and inclusion and, as such, the group must be open to all employees who share the group’s objectives and wish to join.  Excluding an employee because of their race, gender, religion, or other protected status will likely subject the company to discrimination lawsuits and create division.  Requiring Affinity Groups to be open to all interested employees should not alter the group’s objectives.  For example, men may dominate the membership in the Women’s Affinity Group, but the group’s objective—to recruit and retain business women – will not change just because there are more men attending the group meetings.    

Affinity Group participation and/or membership should also be voluntary.  Forcing Affinity Group participation has no benefit and would likely decrease employee morale.

4.         Do Not “Deal With” Participants, Particularly With Regard to Human Resources-Type Concerns

The company guidelines for Affinity Groups should make clear that the group’s purpose is not to raise individual employee concerns or human resources-type concerns generally, but rather to promote the group’s objective.  If an employee raises a concern in the meeting that potentially could be a violation of the law and/or company policy, the guidelines should clearly reflect that Affinity Group leadership will follow the company’s applicable policies for reporting the employee’s concern.  The guideline should also require Affinity Group leadership to make such reports of employee complaint to human resources. The guidelines should also clearly spell out that any manager attending the Affinity Group meeting must immediately report employee complaints to the proper company channels. 

To the extent an Affinity Group wishes to propose a change or raise an issue with management, such issues should be framed as suggestions or comments with the understanding that management may or may not address the concern. Management should make clear that its review of comments is not a negotiation and that it will address issues in the company’s best interests.

E.        Conclusion

            If properly implemented, Affinity Groups provide a variety of benefit to corporate America and will serve as a goal to enhancing the company’s overall diversity and inclusion efforts. If done in a haphazard or inappropriate manner, Affinity Groups may do more harm than good and can result in unintended lawsuits.

 

[i] Affinity Groups have been called a variety of different names including: Employee Network Groups, Social Identity Groups, Advocacy Groups, Focus Groups, Support Groups, and Resource Groups.  This paper will use the term “Affinity Group” to collectively refer to these various names.  Companies support Affinity Groups in a variety of ways, including allowing access to the company’s facilities and email servers; permitting participants to have time away from normal work duties to attend Affinity Group functions; and providing funds for Affinity Groups use.

[ii] Priscilla H. Douglas, Affinity Groups: Catalyst for Inclusive Organizations, Employment Relations Today, Winter 2008, at 11-18.

[iii] Maureen A. Scully, A Rainbow Coalition or Separate Wavelengths?  Negotiations Among Employee Network Groups, Negotiation and Conflict Management Research, February 2009, at 74-91.

[iv] Mona M. Stone, Workplace Diversity: Employee Resource Groups, The Catalyst, March 2009, vol. 14, no. 3 (http://www.isba.org/committees/women/newsletter/2009/03/workplacediversityemployeeresourceg) (last visited September 21, 2015).

[v] Id.

[vi] Eric V. Hall, Know the Risks Before Developing an Affinity for Affinity Groups, Martindale.com, July 9, 2007 (http://www.martindale.com/business-law/article_Rothergerber-Johnson-Lyons-LLP_311158.htm) (last accessed September 22, 2015).

[vii] 5 C.F.R. § 251 (2013); Office of Personnel Management, Guidelines for Establishing Employee Groups (Employee Resource and Employee Networking Groups), Sept. 19, 2013.

[viii] See 42 U.S.C. § 2000e, et seq. The Age Discrimination in Employment Act (“ADEA”) prohibits discrimination based upon age for employees over age 40. (29 U.S.C. § 626, et seq.).  There are also various state statutes that prohibit discrimination based on sexual orientation, transgender and sexual identification. (CITE).

[ix] Moranski v. General Motors Corp., 433 F.3d 537 (7th Cir. 2005).

[x] Id. at 539.

[xi] Id.

[xii] Id.

[xiii] Id. at 541-42.

[xiv] See, e.g., George v. Honeywell Intern. Inc., 136 F. App’x 680, 681 (5th Cir. 2005) (holding Plaintiff’s earlier complaints could be imputed to decision maker); Morris v. CNY Centro, Inc., 99 F. Supp. 2d 241, 249 (N.D.N.Y. 2000)(holding verbal complaints to Vice President who was not Plaintiff’s immediate supervisor, but had authority to hire and fire employees, could reasonably be imputed to the employer).

[xv] 29 U.S.C. § 157. Cf. Banner Health System, 358 NLRB No. 93 (2012) (holding that a policy requiring employee-witnesses to maintain confidentiality of investigations interfered with employees’ Section 7 rights).

[xvi] See Costco, 358 NLRB No. 106 (2012).

[xvii] 29 U.S.C. § 158(a)(2).

[xviii] https://www.nlrb.gov/rights-we-protect/whats-law/employers/interfering-or-dominating-union-section-8a2

[xix] 29 U.S.C. § 152(5) (emphasis added).

[xx] Waugh Chapel South, LLC v. United Food and Commercial Workers Union Local 27, 728 F.3d 354, 361 (4th Cir. 2013); see also Electromation, Inc., 309 N.L.R.B. 990 (1992) (finding that “dealing with” means a bilateral mechanism involving proposals from an employee committee concerning terms and conditions of employment, coupled with real or apparent consideration of those proposals by management”); E.I. du Pont de Nemours & Co., 311 N.L.R.B. 893 (1993) (the “bilateral mechanism” associated with “dealing” “ordinarily entails a pattern or practice in which a group of employees, over time, makes proposals to management, management responds to those proposals by acceptance or rejection by word or deed, and compromise is not required”).

[xxi] Electromation, 309 N.L.R.B. at 995 n.21.

[xxii] Although such situation could certainly result in an unfair labor practice charge, this paper does not imply that such charge would result in a complaint issuing or a finding that the company violated the NLRA. This paper also does not address the company’s defenses to such a charge.

[xxiii] Schengrund v. Pa. State Univ., 705 F. Supp. 2d 425 (M.D. Pa. 2009).

[xxiv] Id. at 429.

[xxv] Id. at 429-30.

[xxvi] The professors also filed under Title VII, Title IX, Pennsylvania Human Relations Act, and the Pennsylvania Equal Rights Amendment.

[xxvii] Id. at 430.

[xxviii] See Stip. of Dismissal, Schengrund v. Pa. State Univ., Civil Action No. 4:07-CV-718 (M.D. Pa. June 4, 2011), Doc. No. 90.

[xxix] 29 C.F.R. §785.44. Moreover, “volunteer activities” must be voluntary and not the result of any coercion or pressure.  Stone, supra note 4

[xxx] Hall, supra note 6.

[xxxi] It should be noted that Affinity Groups often form prior to management initiation, or even prior to management’s knowledge.  

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