The Economic Implications of Gender Based Discrimination at the Workplace - Term Paper Example

THE ECONOMIC IMPLICATIONS OF GENDER BASED DISCRIMINATION AT THE WORKPLACE INTRODUCTION All the actions of economists have been geared towards achieving the economic goals. They have developed different theories and principles to examine the issues encountered in the economy and worked on policies addressing the problems. Unfortunately, some of the economic goals may conflict with each other and may hinder the attainment of these goals. Economic efficiency, economic equity and economic freedom are the central concerns of every society. Collectively, people seek to get as much output as possible from the resources they use. But they also care about how that output is distributed. They want some sort of fairness in the distribution of goods and services. They want to have the equal share in the opportunities of participating in any economic activity present in their society. As our modern society has made the issue on equality clearer, women and men are believed to have the ability to perform with equal skills and success in everything they do including athletics, academics, politics and employment. Basically, this is how the conflicts may arise because of the issues on discrimination in the workplace. Generally, we categorize five types of discrimination taking place at the workplace. This includes: race, sex or gender, religion, age, and disability. This paper will focus on gender or also known as sexual discrimination, its causes and its effects on the economy. BODY At the workplace, gender discrimination happens when we practice letting a person's gender unfairly become a factor when deciding who receives a job, promotion, or other employment benefits. Most of the time, it affects women because they feel they have been unfairly discriminated against in favor of their male counterpart. But there are also cases when the male feels discriminated against their female counterpart. These are the instances when women are favored over them. There are four ways in which gender based discrimination can take place at the workplace. It could be direct, indirect, harassment or victimization. Direct gender based discrimination happens when salary is based on gender of the employees although both are given the same job. The rule “equal job, equal pay” is violated. Indirect gender based discrimination is when certain set of rules or policies are made to indirectly imply that employee of a certain gender cannot qualify those rules or policies. Harassment at the workplace causes emotional as well as psychological trauma for the discriminated employee. Employees could be harassed either sexually or verbally or at times treated inferior because of their gender. Victimization or intimidation often occurs in the form of verbal abuse. The intimidated employee may be threatened, feeling inadequate, unsure of themselves, and fearful. The feeling of being uncomfortable and scared to go to workplace brought about by the actions of the abusers can give the intimidated employee significant emotional stress up to the extent of physical damage in the form of illness, mental breakdowns and severe depression. Gender based discrimination at the workplace has a long history in our societies. It stems from the gender roles assumed in a traditional society. It is where jobs are classified as to male and female jobs. Placing of men or women into specific job categories is explained by the human capital theories. These refer to the qualifications of a person such as education, knowledge, training, experience or skill which makes them potentially valuable to an employer or fit for the position. The story from Excerpts from 'Justice Brennan: Liberal Champion' by Seth Stern and Stephen Wermiel, can speak for this. Chapter 16 entitled “Pedestals and Cages” narrates the story of a recent law school graduate named Alison Grey having a different view of Justice Brennan’s attitude toward women. Alison Grey was one of the top recent graduates from the University of California at Berkeley's Boalt Hall Law School when Stephen Barnett and Robert O'Neil, two of Brennan’s clerks turned professors there, called in late 1970 to tell her of their intention to recommend her for a clerkship in Brennan's chambers. This opportunity made Grey excited, who is then working as an associate at a prestigious Washington, D.C., law firm, Covington & Burling, but instead of accepting it promptly, she asked for a couple of days to think it over. Although she had been first in her class, Grey had given up on the idea of being a clerk at the Supreme Court because a professor told her that the faculty would not waste a nomination on a woman. After contemplating on the matter, she decided to call Barnett back and accepted the nomination. But when one of the professors called Brennan to offer their recommendation, he did not get much beyond saying Grey's first name, which is Alison, before Brennan cut him off. Brennan said, "Send me someone else", making it perfectly clear that he meant a male clerk. Occupations become segregated based on the amount of femininity or masculinity required by the occupation. Service sector jobs such as teachers, nurses, secretaries and librarians are dominated by women while occupations such as architects, engineers and airplane pilots are predominately occupied by men. But this is only true in past because it is understood now that as women and men enters a certain occupation, they should have similar education levels or qualifications that is required by their jobs. But the residual effects of this gender based discrimination still operate in the workplace today to keep women's salaries lower and opportunities fewer than those available to men. One of these effects creating issues is the wage gap or disparity in earnings causing income inequality between the two genders. The published report of Stock in the Wall Street Journal dated September 20, 2010 entitled “Ranks of Women on Wall Street Thin” is a proof to this. There is a fall in the number of women in the U.S. finance industry especially at brokerage firms, investment banks and asset-management companies like insurance companies as provided by the data from the Bureau of Labor Statistics. The figures suggest the fall is due to the impact of recent recession but there are other forces that caused this. But the ranks of women thinned even during the stock and real-estate run up from 2001 to 2006. As a Rutgers University professor and former chief economist at the Labor Department, William Rodgers III, said technology likely accounts for some of the shift. This is because across the economy, jobs that were largely occupied by women like junior and back-office workers are replaced by computers. Ms. Grace Tsiang, an economics professor at the University of Chicago, thinks the shift is attributed to the scrutiny on compensation. She theorized that these women are having and raising children rather than staying on the job. As large portion of this decrease are the younger women ages between 20 and 35 or those just out of college. In addition to these reasons, the stress and scandal that saddled the career discourage women from staying in work. They reported that they get small bonuses because they don’t golf or pal around their male managing directors. More women are also leaving the workplace to go on their own businesses. As Ms. Murphy, became an entrepreneur after leaving Goldman Sachs Group Inc. in early 2008 to start SoleMates LLC, which makes protective covers for high-heel shoes said, her female co-workers were more open to a broader definition of success than her male contemporaries. On the same report posted by Stock in The Wall Street Journal in September 20, 2010, sexual discrimination charges by women at finance companies dropped 28% from 2000 to 2009 according to data from the Equal Employment Opportunity Commission .But the number of charges per woman in the industry climbed during the recession in 2008 and 2009. Related to this is the report of Associated Press last September 15, 2010. The case of the three former female employees, who were a vice president, a managing director and an associate of Goldman Sachs&Co, suing the big Wall Street firm for what they is rampant gender discrimination that unfairly favors men in pay and promotions. In their lawsuit, they alleges that Goldman has the federal and New York City laws because of engaging in a systematic “pattern and practice” of discrimination against female professionals at firm. They are also seeking damages for their emotional distress and for their lost income. One possible explanation for this wage gap as a result of gender based discrimination is the presence of cultural stereotypes. Because women are traditionally viewed as caring and nurturing individuals, they are likely to be designated to jobs that require such qualifications. These qualifications, however, are culturally valued and typically associated with domesticity. Occupations requiring these same qualifications are not economically valued. On the other hand, the men are traditionally viewed as the breadwinner or the provider. This means that occupations dominated by them are historically economically valued, thus, they continue to be economically valued and are paid higher wages. In connection to the cultural stereotyping in our society, a lawsuit was filed in U.S. District Court in Manhattan, as reported by the Associated Press in October 13, 2010. The company, Citigroup, was accused of using companywide layoffs during the recent financial turmoil to terminate its female employees to save the jobs of less-qualified men. The accusations of the female employees include the company’s acceptance of bailout money from the government even as it continued a pattern of “pervasive discrimination and retaliation” against its female employees during the November 2008 layoffs, lesser pay goes to women and women lose out on promotions, raises, and good assignments over their male employees. Also, according to this law suit, Citigroup has long been plagued by a “boys club”. This means that middle and senior management positions will be populated by men. As a matter of fact, its Senior Leadership Committee is composed of 39 men and 5 women, while its Executive Committee is composed of 19 men and no women. Another proof to this is the lawsuit filed against Anheuser-Busch Companies, Inc., the largest brewing company in U.S. As reported by Kesmodel last October 27, 2009, Francine Katz, a former Anheuser-Busch vice president of communications and consumer affairs, has filed a lawsuit in a state court in St. Louis against her former employer for discrimination. Her accusations were that she was paid less than males executives and that the company encouraged a ‘”frat party” atmosphere as it maintains a corporate culture that “adversely impacts women” resulting in their lower salaries and bonuses and fewer opportunities. Lawsuits will be filed as long as there is discrimination at workplace. Some still waits for court orders but some has already received what is due to them. Just like the story Bray in his July 14, 2010 report about Novartis Units settling gender suit for about $175 million. The settlement, which is subject to court approval, resolves a long-running case that a lawyer for a group of women suing Novartis Pharmaceuticals Corp. said could have cost the company as much as $1 billion in damages (Bray, par.2). Gender based discrimination at the workplace does not only affect the market but also the economy as a whole. It indirectly discourages women in particular their freedom to participate in economic activities. It can also cause income inequality between the two genders causing the possible delay in growth and development in an economy. Brennan's reaction to their recommendation of Alison Grey surprised Barnett and O'Neil. When O'Neil had recommended Tigar four years earlier, he knew in advance that the nominee's leftist affiliations might prove problematic. This time it had not even occurred to O'Neil that Brennan would veto a woman out of hand. They did not try to argue with him. His vehemence left them both too surprised and perhaps skittish about doing anything that might cause him to cross off Berkeley permanently from the list of schools that supplied his clerks. They agreed instead to approach their second choice, Paul Hoeber, who had graduated first in his class at Boalt and was then clerking for a Ninth Circuit judge. They called Grey and rescinded the offer. Barnett tried to explain that Brennan did not feel he could have a woman in his chambers (U.S. News, par.11). As in the situation cited above, the potential contributions of women to the society’s economic growth and development are not realized and we rely on the contributions of men instead. Just like Grey, there are more women who are still experiencing the same dilemma. In addition, during times of economic crisis, the women in the labor force are the first to receive the impact. In New York, Citigroup was accused in a lawsuit Wednesday of using companywide layoffs during the recent financial turmoil to purge its work force of scores of female employees to save the jobs of less-qualified men (Associated Press, par.1). Companies tend to fire their female employees first and prioritize the retention of their male employees. Gender discrimination taking place at the workplace has already created several types of barriers for women to advance themselves and join the higher positions in an organization. "As a result of this companywide discrimination, there is a glass ceiling adversely affecting female employees, especially those female employees who become pregnant, take a maternity leave, or have childcare obligations, at Citigroup in all facets of their employment," the lawsuit said (Associated Press, par.12). The effects of the pay gap between genders resulting from gender discrimination at workplace are expected to extend to their future lives. As Rachel highlighted this week, women hold fewer management jobs and are already paid less than their male counterparts.  (Full-time female managers earn just 81 cents to every dollar male managers make.) But that pay gap has an impact beyond today’s paycheck—it can wreak havoc on women’s retirement savings (Hill, par.1). The fact that women live longer than men and women will receive lesser pay will make them suffer in their retirement years. As they double their efforts to serve their families at home and at the same time go to office to work, they still have smaller amount to put in their bank deposits as their savings. To make things worse, because of this gender based discrimination, some products and service providers are intending to charge differently between the two genders. In Brussels, a legal adviser to the European Union's highest court said Thursday that insurers shouldn't be able to charge men and women different rates for products, flabbergasting an industry that frequently takes account of sex to write health, life and auto policies (Forelle, par 1). Of course we all know that this act is not compatible to the principle of equal treatment for women and men. That is why we have to find solutions to prevent, if not to stop, the gender based discrimination from taking place at workplace. Because of the gender discrimination taking place at the workplace, the government and private sector is exerting their efforts to promote women and to educate them about the workplace and its opportunities and pitfalls. To the part of the government, policies and laws are their main concern in dealing with gender discrimination. They enforce laws, such as the International Violence Against Women Act, to solve the problem. Policy change is also applicable in some cities. It takes in the form of lobbying, grassroots political organizing and the most famous one is the class action lawsuit. However, when these direct policy solutions are not possible, the private sectors use many other tactics. They use direct mass actions such as marches, rallies, pickets and civil disobedience. These actions, however, will affect the performance of the local economy as they may interrupt the economic activities going on. The situation can also make the business environment unfavorable to business. Investors are discouraged when they see that the peace and order condition in an economy is disturbed. In the end, this will result to poor business operations and loss income opportunity. CONCLUSION Gender based discrimination at workplace is still a wide spread problem. And whether we accept it or not, women are still the victims. From the differences in their wages and income up to their opportunities in advancement in their chosen careers and possibility of climbing up the hierarchy in their organization, the effects of this gender based discrimination are felt by the women sector. These effects are reflected not only in our societies but also to the performance of our economy as they may delay possible growth and development. The government and private sector can do ways to solve the problems brought about by the gender based discrimination at workplace. Policies matter, and government and private sector convergence on a problem can lead to change (Brown, par.1). And whether this change will lead us to a better or worse economy, we have to face it. BIBLIOGRAPHY Associated Press. "3 Female Ex-employees Allege Bias at Goldman Sachs ." 15 September 2010. Wall Street Journal. 7 November 2010. . Associated Press. "NY lawsuit: Citigroup used recession to fire women." 13 October 2010. Wall Street Journal. 7 November 2010 . Bray, Chad. "Novartis Unit Sttles Gender suit for About $175 Million." 14 July 2010. Wall Street Journal. 7 November 2010. . Brown, Peter. "Public Policy Side Effect: Girls Rule, Boys Drool?" 7 September 2010. wall Street Journal. 7 November 2010. . Forelle, Charles. "Battle of Sexes roils European Insurance." 1 October 2010. Wall Street Journal . 7 November 2010. . Hill, Catey. "For Women, Pay Gap Means Retirement Shortfall." 1 October 2010. Wall Street Journal. 7 November 2010 . Kesmodel, David. "Anheuser Is Sued for Alleged Sex Discrimination." 27 October 2010. Wall Street Journal. 7 November 2010. . Koppel, Nathan. "Claims Alleging Job Bias Rise With Layoffs." 24 September 2010. Wall Street Journal. 7 November 2010. . Stock, Kyle. "Ranks of Women On Wall Street Thin." 20 September 2010. Wall Street Journal. 7 November 2010 . U.S. News. "Excerpt From 'Justice Brennan:Liberal Champion' by Seth Stern and Stephen Wermiel ." 26 September 2010. 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