July 19, 2011
Balance View
Who would have thought an employer’s organization (org) chart can be used to support a claim of race, or other illegal employment discrimination?
An org chart may be a useful device for an employer, as it shows reporting relationships among the various levels and departments throughout an organization. Even this long-used and seemingly benign instrument must be constructed carefully as it may be alleged to provide support to a discrimination claim. In a suit fi led in federal District Court in 2007, a minority department head in an organization claimed she should have had the same title—viz., Vice President—and been paid within the same salary range as all of the corporate vice presidents, with whom she shared the same horizontal line of the company’s org chart.
In fact, the company had never intended its organization chart to reflect salary relationships or the comparability of salaries among its employees. Similarly, it had not intended the chart would suggest that an individual’s position in the vertical chain of command in, for example a department, could be compared with the positions of any other employees on a horizontal basis. In addition, the company regularly retained outside wage consultants to determine both the appropriate title and the appropriate pay grade for each position on the org chart, based upon a job description for each position that had also been regularly reviewed and updated.
Nevertheless, the employee pointed to the fact she had never been given the title of Vice President and had not been paid within the range of vice presidential pay. She alleged this was discriminatory, because all of the other positions in the same senior level horizontal line on the org chart were Vice Presidents and were fi lled with non-minorities. She pointed to the org chart as establishing her claim that while her role was recognized as having the same importance the organization as that of every Vice President—she headed a department, as did each of the VPs, and thus was designated on the same horizontal line as they—she, alone, was denied the title and pay of a Vice President.
Two Methods for Avoiding Discrimination Claims
It is unlikely such a claim, in the absence of any more evidence of discrimination, would result in judgment for the employee. This case instructs, however, that an organization must take care in developing an org chart. We suggest two alternative methods for avoiding discrimination claims on this basis. First, construct the chart so as to show both relationships among those in comparable pay grades and reporting relationships. This would, however, require a great deal of careful consideration and could also generate an org chart with an unusual configuration. Second, perhaps more simply, an org chart may have a caveat noted on it that states the chart’s sole purpose is to show reporting relationships and further, that it is not intended to reflect comparative positions within the organization with respect to pay, pay grades, difficulty or comprehensiveness of job duties, or any other factor.
For more information on these issues and on how to avoid “org chart issues,” contact author Rick Vernon at (301) 907-2818 or rgvernon@lerchearly.com.
Rick Vernon, an att orney who founded and co-chairs Lerch, Early & Brewer’s Employment & Labor group in Bethesda, Maryland, defends employers against all workplace claims, including discrimination claims and wage and hour (overtime) disputes. His practice also involves extensive counseling and advice to reduce the risk of litigation on issues relating to compliance with employment statutes and regulations and with judicial and administrative rulings.
This article originally appeared in the 2011 Quarter 2 edition of Balance View, the newsletter of news and information on HR and affirmative action issues published by Berkshire Associates, Inc.
