Workplace Gender Compensation Discrimination – Dollar General Corp

Subject: Sociology
Pages: 9
Words: 2520
Reading time:
10 min
Study level: PhD

Introduction

For several decades, the urge to provide a sustainable working environment with enhanced corporate social accountability has been the greatest challenge for corporate managers; however, workplace discrimination has steadily been augmenting (Grey-Bowen & McFarlane, 2010). While modern managers seem to impose corporate policies that curb social discrimination at workplaces and are struggling to reinforce ethical leadership, gender, racial, and social injustices are still prevalent (Chou & Choi, 2011).

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Although the efforts to ensure equitable access to social amenities in organizations have heightened, women managers have increasingly faced compensation and benefit unfairness in various organizations. A tremendous number of women have persistently complained about workplace compensation and benefit bigotry despite possessing equal competence abilities (Chou & Choi, 2011). As gender compensation discrimination continues to affect the motivation of female workers, the need to provide a sustainable solution to the menace is rising. Therefore, this essay seeks to investigate the plight of the alleged workplace gender discrimination in the compensation and benefits aspect of Dollar General Corporation as part of the literature review and examines implications with a view of providing appropriate recommendations.

Literature Review

Brief Historical View of Dollar General Corp

Dollar General Corporation is an American company that came into existence fully in 1955, as a discount retailer firm that dealt with retail consumer goods within Eastern, Southwestern, Southern and Midwestern parts of the United States (Redden, 2014). Turner and Cal Turner are two exemplary American family entrepreneurs, who initiated a wholesale that they initially named Turner and Son Wholesale in 1939 around Scottsville town. After managing to accommodate merchandise worth thousands of dollars, the company management renamed its enterprise to Dollar General in the year 1955, when demand for consumer goods and apparel intensified (Redden, 2014).

In the fiscal year that ended in February 2012, the company renovated 625 stores and relocated 575 stores. Towards March of 2012, years after overcoming global financial predicaments, the company managed to expand and establish 9,961 stores within 39 American States (Redden, 2014). According to Redden (2014), Dollar offers a continuum of consumer commodities ranging from seasonal home products, consumables, and different forms of apparel.

Consumable goods are cleaning products, stationery, laundry products, food, beverages, and snacks among others. The company has a reputation for purchasing and dealing with renowned national brands such as Coca-Cola, PepsiCo, Procter & Gamble, and Kimberly Clerk among others (Redden, 2014). For its consumers, the company believes in offering quality goods, while for employees, the company considers respect and opportunity as integral values to all stakeholders.

Redden (2014) explains that despite having an overwhelming market reputation regarding its service delivery to its esteemed consumers, Dollar General Corporation recorded a series of corporate scandals concerning workplace gender compensation discrimination. An official assessment of its corporate practices regarding workplace issues conducted from the beginning of the year 2000, provided shocking revelations to the Americans (Redden, 2014).

Several women employees lamented about workplace pay discrimination practices against women and revealed that the company management used compensation strategies that disproportionately harmed female employees despite having or proving to have equal workplace competencies.

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Assessment of Current Challenge

Perhaps, Dollar General is the biggest and most respected employer in America, but the recent spate of cases regarding its involvement in gender bias significantly tarnished its name (Redden, 2014). The 2006 investigative report of the Equal Employment Opportunity Commission (EEOC) disclosed that female store managers earned relatively low compensation packages compared to their male counterparts with similar working competencies.

According to Redden (2014), regardless of the 2008 case of Patty Eberle creating national and political discourses that denounced the practice of gender pay discrimination, several other cases arose from over 2000 former and current women employees. Some women claimed that Dollar General was insensitive to women’s payment claims because on several occasions hired men at considerably higher pay rates than those offered to women employees in the same job ranks (Redden, 2014). The case of Patty Eberle prompted reactions from retired and serving female store managers, who sought to file a class-action lawsuit against Dollar General for its biased payments.

Following a court order in 2006, Dollar General successfully managed to compensate all women, who presented their sentiments to the court regarding the discriminatory payment practices with a sum exceeding $15 million (Redden, 2014). Subsequently, Janet Calvert, another former manager, sued the company on similar allegations and 2100 more women with similar claims joined Calvert in suing the company. The EEOC supported the lawsuit and issued notes of suing rights against the leadership of Perdue for discriminatory payment practices (Redden, 2014).

In the early part of the year 2011, the federal court made informed judgments and slummed Dollar General $15.5 million for compensation of plaintiffs, about $2.8 million for paying claims administrator, and $3.25 million as attorney’s fees. Such unintended compensation payments depict massive losses that the company incurred simply due to unethical and illegal business practices (Redden, 2014). Dollar General suffered a corporate blow by incurring unintended losses, losing communal respect from its surrounding environment, and damaging its labour market reputation.

Standard labor practices and American labor laws advocate for non-discriminatory workplaces, where employees are free to enjoy employment benefits that the organizations they serve are capable of offering (Grey-Bowen & McFarlane, 2010). Companies with virtuous leadership are normally keen on understanding and upholding the rules and regulations governing a nation or the environment in which they are operating their businesses. The incidences of gender compensation biases were a breach of the American employment laws and general rule of law. The EEOC is a central law enforcement bureau that has the mandate to enforce regulations against workplace intolerance.

According to Correll, Benard, and Paik (2011), the agency is majorly responsible for enforcing the employment Title VII regulations stipulated under the Civil Rights Act of 1964, which prohibits workplace discrimination, including employment, promotion, retrenchment, payments, fringe benefits, remunerations, and job training. The EEOC urges employers to provide equal employment opportunities to all eligible persons regardless of race, gender, national origin, color, or religious affiliation.

Other Organizations with a Similar Situation

Pay bias at Bank of America

The incidences of workplace compensation discrimination have been eminent in America and Dollar General Corporation is just among other several giant companies and business organizations that have experienced similar scandals. Despite the presence of the EEOC, giant companies have practiced payment discrimination and other compensation biases against women employees (Chou & Choi, 2011). One of the latest corporate scandals that prompted public reactions and government investigations is the case of Bank of America that paid millions to settle discrimination lawsuits (Zurich, 2010).

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In September 2013, the federal court concluded on a class lawsuit of 4,800 former female employees of Bank of America, who alleged that the organization discriminated against them against equal compensation and investment advice divisions (Zurich, 2010). The federal court charged the bank a colossal amount of $ 39 million for breaching anti-bias stipulations of the United States Civil Rights Law. Such cases marred a subsidiary corporate organization Merrill Lynch that paid huge amounts of money approximately $250million to compensate formally biased women.

Incidence 2: Pay bias at the Wal-Mart Company

Wal-Mart is another mega-company in the United States that attracted public and legal attentions following the revelation of gender discrimination practices in terms of compensation. Sometime before the 2000 new millennium, over 2,000 female employees from 48 American States merged together to seek justice on a claim that Wal-Mart deliberately discriminated against women against promotions and payments (Zurich, 2010). Through the Equal Employment Opportunity Commission, about 1,975 Wal-Mart female employees managed to file a class-action lawsuit on the slated deadline against the company.

After the United States Supreme Court dismissed the class-action lawsuits, women re-emerged and filed new class-action lawsuits on similar grounds. Zurich (2010) reveals that the plaintiffs argued that managers had the sovereign authority to design wages, promote employees, and arrange salaries, and thus, their gender discrimination was deliberate regardless of corporate regulations. Wal-Mart obeyed the court command and paid over $11.7 million compensation and wage damages to the complainants, before paying $973,000 to another recent female pharmacist on the same claims.

Incidence 3: Pay bias at Novartis Pharmaceuticals

Numerous giant companies have persistently ignored the Title IIV anti-discriminatory regulations of the United States Civil Rights Law. Novartis Pharmaceutical is among the American giant companies that faced allegations of discriminatory pay gap involving the gender of employees after about 5,600 female employees launched a class-action lawsuit against the company (Zurich, 2010). After evidence of the female employee, complainants revealed that Novartis Company practiced discriminatory salary and promotion strategies that favored the male workforce, adjudicators of a New York federal court charged the company (Zurich, 2010).

The court decided to award $250 million as damages to the 5,600 female complainants, following judgments on the class-action lawsuit. Economic experts argued that the company is liable to pay up to $1billion if more women co-workers merge for more class-action lawsuits (Zurich, 2010). Novartis violated Title VII provisions of the Civil Rights Act (1964) and the Equal Pay Act (1963) by discriminating against women employees on compensations.

Theories and Strategies that Would Resolve the Situation

Managers know very well that workplace pay discrimination based on gender considerations has foreseeable harm to the job satisfaction of the affected gender and company reputation (Correll et al., 2011). Several theories of ethical leadership and ethical business practices have advocated for a moral decision-making process regarding workplace promotions, employment, compensation, and recognition of employees. Gender compensation discrimination is an unethical or immoral business practice that goes against the ethics business theory of justice (Elms, Brammer, Harris, & Philips, 2010).

The justice theory of business ethics stipulates that companies must uphold and enact policies that promote justice in all forms of business practices, including employee hiring, compensation, or promotion. The justice theory believes that the negative consequences of intended actions are merely the results of ignorance regarding the regulations that promote workplace fairness (Furlong, 2008). When managers and human resource personnel consider following the rule of law effectively, all employees and other stakeholders would be able to enjoy equal rights towards payments, promotions, and related compensations.

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Practicing ethical leadership and maintaining moral business practices are critical issues that modern human resource managers and employers should understand given the rising demand for gender impartiality within organizations. According to Furlong (2008), corporate leaders have the moral obligation of ensuring that they provide a sustainable workplace environment to all employees, regardless of their creed, political affiliation, social background, cultural values, nationality, or physical condition.

Furlong (2008) further states that doing the right thing means being considerate to the welfare of others, respecting their individual dignity, upholding the norms governing a business practice, and working in accordance with rules and regulations governing business operations. In management, the theories of utilitarianism and rights theory are crucial in ensuring equitable access to resources, opportunities, and compensations in corporate organizations (Furlong, 2008). The utilitarianism theory postulates that individuals should practice their actions righteously since there is normally an association between the actions of individuals and the consequences. Violation of employment norms such as regulations constitutes unethical practices.

Empirical evidence from American labor organizations reveals that women have remained overrepresented in underpaying jobs, while underrepresented in overpaying occupations (Correll et al., 2007). The professional code of business ethics, human rights stipulations, and leadership ethics require managers to act morally and professionally in their lines of duty. Marks (2012, p. 263) states that “professionals and professional organizations are respectively essential individuals and organs of society in local, national, and global endeavors to respect, protect, and fulfill human rights.” Dollar General Corporation, Bank of America, Novartis Pharmaceuticals, and Wal-Mart are giant companies, whose managers have knowledge about American laws and principles of professional practices.

Rule of law should act as a conveyor belt towards the decisions that ensure that workplaces are free from payment conflicts, gender discrimination, workplace abuse, and unethical practices (Furlong, 2008). The leadership of corporate organizations must understand that business competition is intensifying and only companies that provide a sustainable environment, will attract, employ, and retain the competent workforce.

Implications and Possible Recommendations

Nothing ruins corporate image like legal scandals against effective employees, especially on payment issues, considering that compensation package is the interest of most employees (Marks, 2012). To alleviate gender pay discrimination, the four aforementioned companies should consider a number of human resource solutions. To start with, the companies should conduct the statistical pay-equity assessment, which would allow them to provide the employees with justifiable reasons behind pay differences between male and female employees (Goodstein & Wick, 2007). Secondly, laws and norms make up corporate culture, and hence, formulating anti-discrimination policies within the framework of company policies would assist to merge with national laws that shun workplace bigotry (Goodstein & Wick, 2007).

Thirdly, the companies should consider designing and implementing open employee forums and programs that discuss issues regarding workplace challenges, employment impartiality laws, individual workplace obligations, and equal employment opportunity discussions (Goodstein & Wick, 2007). The above three approaches will be a gateway towards building sustainable and democratic organizations that foster equity, discern workplace discrimination, and embrace mutual corporate growth.

In addition, conflicts will always arise if managers consistently consider designing payments that seem to favor certain individuals in a workplace. As an option towards ensuring reasonable pay rates for each occupation within an organization, the four companies should consider formulating salaries and remuneration committee as an independent agency mandated to design payments, compensations, and fridge benefits (Correll et al., 2007). Another significant approach that would reduce gender pay bias is the change in the hiring techniques where work skills and competence would act as prerequisites consideration when negotiating payments before any job placement.

To commence, effective compliance with the rule of law would require hiring legal advisors such as lawyers and advocates within the human resource department to preside and expound on legal stipulations of the state and federal laws in which any of the companies operate (Correll et al., 2007). The four companies can consider formulating independent bureau to assess, advise, and conduct performance appraisals, which would act as a source of employee retention strategies.

Conclusion

Companies have failed to understand that America is facing an influx of economic downsize and women have nowadays combined efforts with their husbands to act as primary breadwinners of their respective families. The reason why women are frequently joining fellow coworkers and friends to file class-action lawsuits against their employers regarding payment and compensation biases is socially, economically, legally, and ethically justifiable. The employment laws as stipulated under Title VII of the Civil Rights Act of 1964 and the 1963 Equal Pay Act require managers and organizations to cease practicing gender-based discrimination.

Most importantly, companies such as Wal-Mart, Novartis Pharmaceuticals, Dollar General Corporation, and Bank of America, which have violated compensation provisions, have recorded poor legal defenses. This means that they have not only lost corporate reputation, but also colossal amounts of money as punitive damages as per the decisions of the court. To eliminate all forms of discrimination in the workplace, organizations should abide by the rules and regulations of the EEOC and refrain from gender discrimination.

References

Chou, R., & Choi, N. (2011). Prevalence and correlates of perceived workplace discrimination among older workers in the United States of America. Ageing & Society, 31(1), 1051-1070. Web.

Correll, S., Benard, S., & Paik, I. (2011). Getting a Job: Is There a Motherhood Penalty? American Journal of Sociology, 112(5), 1297-1339.

Elms, H., Brammer, S., Harris, J., & Phillips, R. (2010). New directions in strategic management and business ethics. Business Ethics Quarterly, 20(3), 401-425.

Furlong, E. (2008). Right or Wrong: Legal and ethical issues and decision making. London: Jones and Bartlett Publishers.

Goodstein, J., & Wicks, A. (2007). Corporate and stakeholder responsibility: Making business ethics a two-way conversation. Business Ethics Quarterly, 17(3), 375-398.

Grey-Bowen, J., & McFarlane, D. (2010). Gender compensation discrimination: an exploration of gender compensation gap and the higher education connection. Journal of Business Studies Quarterly, 2(1), 65-82.

Marks, J. (2012). Toward a unified theory of professional ethics and human rights. Michigan Journal of International Law, 33(215), 216-263.

Redden, M. (2014). GOP Senate Candidate Led Company Slammed for Gender Pay Discrimination. Web.

Zurich. (2010). Gender-based discrimination in pay: Why you should care and what you can do to prevent litigation. Web.