Discrimination is an unfortunate reality for many of our nation’s LGBT workers. Recent research and data show us that 42 percent of LGB workers and an astonishing 90 percent of transgender workers have experienced some form of discrimination on the job. Congress must pass the Employment Non-Discrimination Act (ENDA) to give these workers uniform and comprehensive protections against unfair and unjust workplace discrimination.
Until then, far too many gay and transgender workers will be forced into the ranks of the unemployed at a time when all families are struggling to stay afloat. But discrimination is not only a problem for gay and transgender workers. Workplace discrimination also imposes significant financial harm on businesses, introducing inefficiencies and costs that cut into profits and undermine the bottom line.
The Center for American Progress (CAP) documents these inefficiencies and costs in its groundbreaking new report entitled, “The Costly Business of Discrimination: The Economic Costs of Discrimination and the Financial Benefits of LGBT Equality in the workplace.” This report examines five core ways in which discrimination imposes significant financial harm on businesses:
- RECRUITMENT: When employers hire individuals based on job-irrelevant characteristics such as sexual orientation and gender identity, businesses are left with a substandard workforce that diminishes their ability to generate healthy profits.
- RETENTION: Discrimination forces otherwise qualified gay and transgender employees out of a job and into the ranks of the unemployed and introduces numerous turnover-related costs. According to a recent study, to replace a departing employee costs somewhere between $5,000 and $10,000 for an hourly worker, and between $75,000 and $211,000 for an executive making $100,000 a year.
- JOB PERFORMANCE AND PRODUCTIVITY: Sexual orientation and gender identity discrimination in the workplace needlessly compromise maximum labor productivity and workforce output. Moreover, it introduces unnecessary costs by increasing absenteeism, lowering productivity, and fostering a less motivated, less entrepreneurial, and less committed workforce.
- MARKETING TO CONSUMERS: When companies discriminate and allow unfairness to go unchecked in the workplace, consumers increasingly react by actively choosing to do business elsewhere.
- LITIGATION: Businesses are increasingly liable for discrimination lawsuits even in states that have not outlawed gay and transgender discrimination, making discrimination economically unwise for companies in all 50 states. In 2010 the top 10 private plaintiff employment discrimination lawsuits cost firms more than $346 million.
Alternatively, the report unearths how policies that level the playing field for LGBT workers can bring a substantial amount of cash into company coffers. This is why America’s largest and most successful companies have implemented a range of policies that ensure the fair and equal treatment of LGBT workers. Of Fortune 100 companies, 93 percent have nondiscrimination policies that include sexual orientation, 74 percent for gender identity, and 86 percent provide equal partner health insurance benefits.