Recent events have brought the issue of racism to the forefront. Regardless of your race, religion, gender, sexual orientation or political affiliation, you've likely felt a range of emotions — anger, frustration, fear, helplessness — over the recent deaths of unarmed African Americans and the violence that has ensued during protests across the country.
Fortunately, business owners are in a unique position to make a real, tangible difference in the fight against racial inequities, harassment and discrimination. The following best practices — organized in an easy-to-remember A-E-I-O-U acronym — can help your organization become more intentional in its approach to promoting diversity in the workplace.
The first step to solving a problem is admitting that a problem exists. That's why management needs to open the lines of communication in your workplace to discuss racism.
For example, your president or CEO might send out an email or conduct a company-wide meeting that explains his or her commitment to workplace diversity. Likewise, formal training can help educate workers about diversity-and-inclusion issues and how diversity can be a valuable asset. Consider creating a diversity-and-inclusion task force that will meet on a regular basis to build on the momentum gained from meetings and training programs.
Reporting hotlines can also help create awareness. In some cases, management may be blind to harassment and discrimination that's happening on the frontlines by co-workers, suppliers and customers. Remember, some forms of harassment and discrimination can be subtle. Frank insights from rank-and-file employees, customers and suppliers can be eye-opening — and discussions about real-life incidents can lead to awareness and change.
Organize your project teams to include people from a broad range of backgrounds so they all have a voice. Diversity is a strength that leads to better-informed decisions and team members who feel valued and respected. If your company has a board of directors, consider bringing on new members who can offer fresh perspectives.
Your business can also update human resource practices to focus on diversity when hiring and promoting workers. This may require you to recruit job candidates from outside your immediate geographic area. Or you might provide job training and tuition reimbursement opportunities to existing workers to bridge any skills gaps that are holding them back from advancing to higher level positions. Mentoring programs can also help younger, less experienced workers gain confidence and insights from successful people with similar backgrounds who have encountered similar challenges.
Today, there are many successful people of color who serve as role models for the next generation. But African Americans and other people of color still make up a disproportionate percentage of economically distressed communities in the United States. People who are born in distressed communities often have limited educational and vocational opportunities that enable upward economic mobility. Your business can help combat this situation by investing in these communities and the people who live there.
For example, have you considered moving to or opening a location in an economically distressed community? This may help lower your monthly operating costs, provide a pool of eligible workers, and offer tax-saving opportunities if the community is considered a qualified opportunity zone (QOZ). There are currently more than 8,700 communities in all 50 states, five U.S. territories and Washington, D.C., that have been designated as QOZs. The zones are designed to spur economic development and job creation in distressed communities.
Investors can form private investment vehicles, known as qualified opportunity funds (QOFs), for funding development and redevelopment projects in QOZs. The tax code provides temporary deferral of inclusion in gross income for capital gains reinvested in a QOF and the permanent exclusion of capital gains from the sale or exchange of an investment in the QOF.
Likewise, hiring workers from certain target groups may qualify your business for the Work Opportunity Tax Credit (WOTC). This tax break was extended through 2020 by the Taxpayer Certainty and Disaster Tax Relief Act.
Unfortunately, people of color also tend to be disproportionately represented by the target groups designated for the WOTC. Groups targeted by this credit include:
- Long-term family assistance recipients,
- Qualified recipients of Temporary Assistance for Needy Families (TANF),
- Qualified veterans,
- Qualified ex-felons,
- Designated community residents who live in empowerment zones or rural renewal counties,
- Vocational rehabilitation referrals for individuals who suffer from an employment handicap resulting from a physical or mental handicap,
- Supplemental Nutrition Assistance Program (food stamp) benefits recipients,
- Supplemental Security Income benefits recipients, and
- Summer youth employees.
To qualify for the WOTC, a summer youth employee must be 16 or 17 and reside in an empowerment zone or enterprise community. This credit is equal to 40% of the first-year wages of $3,000 earned from May 1 through September 15, up to a maximum of $1,200 for someone working at least 400 hours.
Your business also can consider working with local high schools and community colleges to offer internships and apprenticeships to youth from economically distressed communities. These programs can expose highly motivated young people to job experience and training to help them succeed as adults.
Have you conducted a formal compensation study to look for racial pay gaps in your workplace? Workers should generally be paid the same amount for performing the same (or similar) job functions, though some differences may be due to seniority, exceptional performance, job experience or education level. If you discover pay gaps based solely on race, create a plan to shore them up.
Also look at the benefits your company offers its workers. Providing all employees with access to health care and retirement benefits — and encouraging them to participate in those programs with matching provisions and educational workshops — can help combat racial disparities.
Above all, your company should strive to be a place where people of all backgrounds feel welcome, safe and valued. Celebrate success stories in your company's internal communications and social media posts. This can have a snowball effect by engendering employee loyalty, reducing turnover and building long-term value.
Your organization's tone starts at the top and filters down the ranks. Consider revising your company's mission statement and goals to cover diversity-and-inclusion issues. Choose supply chain partners — suppliers, contractors and customers — who share your vision. Boast about your diversity-and-inclusion practices at industry workshops, trade shows and community events and in your sustainability report, if your company publishes one.
Encourage workers to follow your lead. Support volunteerism and other charitable activities among workers that will help reduce racial inequalities and discrimination. Match your employees' charitable contributions.
We're in this Together
Confronting racism is part of corporate social responsibility. Though change won't happen overnight, it's a good time to make positive changes in your workplace. Small changes will make a difference over time.