LGBTQ Policy Implementation: It’s Cheaper than a Lawsuit

Integrity is doing the right thing when no one is watching, and when the law is involved, doing the right thing is much cheaper than a lawsuit. The majority of Fortune 500 companies agree with this statement when it comes to protecting LGBTQ people from workplace discrimination. Given that nearly 52 percent of LGBTQ Americans live in states that allow employment discrimination on the basis of an individual’s actual or perceived sexual orientation or gender identity, employer non-discrimination policies, trainings and leadership development programs explicitly protecting LGBTQ employees are critical for both the financial well-being of LGBTQ employees, and the long-term profitability of businesses.

While the majority of fortune 500 companies understand the value of investing in proactive workplace practices, research underscores that unfairness in the workplace is tragically still a common and expensive occurrence costing employers $64 billion every year. This amount represents the annual estimated cost of more than 2 million workers in the US who leave their jobs due to bias and discrimination in the workplace. A significant number of these workers are LGBTQ, and have been treated unfairly simply because of who they are, or who they love.

Businesses that evaluate their employees solely on the qualifications and performance of their employees have a competitive advantage as compared to those employers that allow employment discrimination on the basis of job-irrelevant characteristics such as race, ethnicity, age, disability, gender identity and sexual orientation. Such businesses are vulnerable to expensive lawsuits and lose out on appealing to diverse markets, jeopardizing their long-term profitability. In 2014 alone, the combined purchasing power of LGBTQ adults was estimated at $884 billion.

My firm, Rhodes Perry Consulting, works with those proactive companies looking to attract LGBTQ consumers and gain a competitive advantage in their industry. The firm equips leaders with the confidence and tools to build a more diverse and inclusive workplace for LGBTQ employees, which leads to improved products and services attracting LGBTQ consumers. Many businesses come to RPC with requests related to developing LGBTQ inclusive policies, and designing training curriculum to develop the workforce. While these are generally important first steps to managing change in any organization, RPC first encourages an overall assessment, connecting with key stakeholders to better understand the organization’s culture and climate as it relates to welcoming and including LGBTQ employees and consumers.

Part of my firm’s assessment examines the following strategies any business can employ to build a more inclusive workforce and develop products and services that appeal to target markets. These strategies are critical and should be considered when managing any type of organization change initiative:

  • Recruiting the Best & Brightest. Securing financial stability and growth for most businesses relies on the long-game of attracting the best and brightest people. In order to attract new talent, it is essential for employers to draw from many different sources including LGBTQ professional associations and work hard at hiring those candidates most qualified for the position. During the hiring process, businesses must equip their human resources staff with the knowledge and expertise to answer specific questions related to LGBTQ non-discrimination policies, family and healthcare benefits, and employee resource groups. Prospective LGBTQ employees will strongly consider opportunities with employers who have taken the time to empower their HR staff with information relevant to welcoming prospective LGBTQ employees, and having a sense of the frequently asked questions they may have about the employer.

  • Retaining Talent. Clear non-discrimination policies are likely to offset the significant costs of replacing a departing employee who may leave a position because of a hostile workplace. According to a recent study, replacing a departing employee costs between $5,000 to $10,000 for an hourly worker, and between $75,000 to $211,000 for an executive making $100,000 annually. Due to such high costs, most businesses spend a great deal of time focusing on how to retain existing talent. When it comes to retaining LGBTQ employees, employer sponsored healthcare benefits are essential. One strategy to retain LGBTQ employees is by offering healthcare benefits for LGBTQ headed families and their dependents, and by insuring that existing healthcare plans offer inclusive of transgender healthcare benefits. Such investments are likely to offset high costs associated with departing employees.

  • Enhancing Productivity. LGBTQ employees who feel valued in the workplace and have a high level of job security are more likely to have higher levels of productivity and job satisfaction. Employees who feel secure about their job are more likely to have higher attendance rates and a stronger commitment to their career as compared to those who fear discrimination in the workplace. LGBTQ employees are more likely to have a strong sense of job security when leadership reinforces the importance of a diverse and inclusive workforce, policy and practices are inclusive of LGBTQ people, and when employee benefits explicitly include LGBTQ people and their dependents. When employees can bring their authentic selves to work, businesses are more likely to realize the full potential of all employees.

  • Marketing to LGBTQ Consumers. The combined annual purchasing power of LGBTQ adults is estimated at almost $1 trillion dollars. Thus, attracting LGBTQ consumers is a high priority for motivated companies that wish to realize significant profits and the brand-loyalty of LGBTQ consumers. Studies have shown that LGBTQ people are 25 percent more likely to stick with a brand, even when its prices increase. To appeal to this profitable market, businesses must work to have LGBTQ employees present at all levels of the organization, amplify their commitment to protecting LGBTQ staff and give charitable contributions to LGBTQ related causes. By employing these strategies, businesses are more likely to attract LGBTQ consumers and the brand loyalty that comes along with it.

  • Limiting Litigation Risks. Proactively putting in place an inclusive employee non-discrimination policy, distributing this policy in human resources materials and vigilantly enforcing it when necessary will insulate businesses from the threat of discrimination litigation translating into significant savings. Most of these implementation actions come at negligible costs relative to the overall operating budget, and enable employers to get the very most out of their staff. The important factor in enforcing such non-discrimination policies is to immediately respond to any allegations of workplace discrimination and harassment by empowering select staff to conduct internal investigations when necessary, and promptly taking action when necessary.

Rhodes Perry Consulting is ready to collaborate with businesses interested in assessing the inclusivity of a business, developing and implementing LGBTQ workplace policies. Taking these actions will enable more businesses to compete for the most diverse and inclusive talent, and will increase long-term profits. Employing the strategies above, especially for organizations in states that currently lack LGBTQ workplace protections, are actions of integrity, they are the right thing to do, and working together we will realize infinite potential.

Written by Rhodes Perry



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Rhodes Perry

Rhodes Perry is a nationally recognized expert on LGBTQ and social justice public policy matters, with two decades of leadership experience innovating strategy management, policy and program solutions for corporations, government agencies, and non-profit organizations. At his core, Rhodes is an entrepreneur, where he most recently established Rhodes Perry Consulting, LLC, a national diversity and inclusion consulting firm that uses an intersectional approach to collaborate with leaders on creating solutions in the practice areas of strategy management, issue advocacy, and stakeholder engagement. Previously, Rhodes founded the Office of LGBTQ Policy & Practice at the New York City Administration for Children’s Services, and prior to this assignment he served as the founding Director of Policy at PFLAG National where he led the policy strategy and advocacy efforts for the organization’s 350 chapters. He cut his teeth serving as a Program Examiner at the White House Office of Management & Budget, where he improved upon federal benefit programs designed to provide assistance to low-income communities. Rhodes earned a Bachelor of Arts in Economics and Gender Studies from the University of Notre Dame, and obtained a Master of Public Administration from New York University.