Recession woes hurt anti-bias enforcementThe recession's...


October 09, 1992|By Kim Clark

Recession woes hurt anti-bias enforcement

The recession's ripples are causing turbulence in anti-discrimination enforcement.

Attorneys for the Maryland Human Relations Commission say an unprecedented number of their cases now involve businesses under bankruptcy court protection.

That means employees who have been treated unfairly because of their gender, race or physical handicap must wait longer for justice and collect less in reparations, says HRC attorney Lee Hoshall.

Marylanders who've been fired for illegal reasons -- such as racial discrimination -- can collect back pay.

But when a company files for bankruptcy, claims by discrimination victims are placed among those of other other unsecured creditors -- most of whom collect only a tiny percentage of what they are owed, Mr. Hoshall says.

Consider the case of Raymond L. Stanton, a black man who was an assistant manager of the now-closed White Marsh Channel Home Center. In 1987 he was fired for allegedly "fraternizing" with a white saleswoman.

But HRC investigators found that the two were just friends, and that other Channel executives -- including the man who fired Mr. Stanton -- had been involved in same-race relationships with subordinates without penalty.

In 1989, the state filed discrimination charges against Channel and demanded an apology and two years in back wages -- nearly $43,000 -- for Mr. Stanton.

But as the case made its way through the courts, Channel filed for bankruptcy court protection. New Jersey-based Channel negotiated a settlement for $30,000.

Mr. Stanton got his check this summer -- five years after he was fired.

Channel paid unsecured creditors only 10 cents on the dollar. So, after taxes, Mr. Stanton's two years' worth of back pay was worth $2,600.

"I looked at the check and smiled. I was in shock . . . It was ridiculous," Mr. Stanton says.

More full-time workers have flexible schedules

The number of full-time workers with flexible work schedules has risen by a third since 1985.

A U.S. Department of Labor survey found that 12.1 million workers -- more than 15 percent of the work force -- could change their work hours somewhat to fit personal needs by 1991.

The benefit wasn't distributed equally, though.

White-collar workers were twice as likely to have flexible hours as blue-collar workers.

Why? Because many blue-collar jobs require crews, while white-collar jobs can be done individually, Maryland employers say.

Kathy Fowler, office manager of Finishes Inc. in Eldersburg, says all six workers in the construction firm's office have fairly flexible work schedules, though the small company has no written policy on the matter.

"It is very informal," she says, adding that workers must "stay until their work is done."

But the company's 30 construction workers have to work at the job sites at the same time as the rest of the crews -- from 7 a.m. to 3:30 p.m.

Employers turn to self-insurance

As health insurance costs soar, some companies find the best way to cut costs is to take more risks.

The Employee Benefit Research Institute says employer spending on health insurance nearly tripled from 1980 to 1990, reaching $174.2 billion -- or $3,605 per employee at the end of the decade.

In 1990, health care made up 6.6 percent of total compensation costs, up from 4.4 percent a decade before.

To fight back, an increasing number of firms are cutting out the insurance company middleman and self-insuring their employees. Self-insuring cuts out the insurers' profits and thus can save companies money.

EBRI reported a doubling of the share of medium-sized and large firms that were paying their employees' health-care bills


But there's a dark side.

Insurance is based on the idea of spreading out risks of catastrophes over a large number of people. EBRI warns that it is dangerous for small companies. A single catastrophic illness can cost half a million dollars and ruin an unprepared company.

Some companies are trying to balance the risk and savings.

Environmental Elements Corp., which makes air-pollution equipment, pays most small claims and uses Blue Cross and Blue Shield of Maryland as an administrator and insurance backstop for catastrophic claims.

Mary Shiplet, supervisor of benefits and compensation for the 250-employee company, says her bosses are afraid to take the big insurance risks. It's too soon to say whether the 2-year-old program is saving the Baltimore company any money, Ms. Shiplet says. But the program does give the company "more of an idea of what is happening" with claims, she says.

Idea to save U.S. jobs could win you $1,000

Got an idea about how to save American jobs? It could win you $1,000.

Two Philadelphia authors preparing a book on how to keep Americans working are holding a contest for the best idea.

They promise a $1,000 prize to the winner, and credit in their book.

Mail a one-page description of your idea, including your name and address, to "Help Save American Jobs," P.O. Box 365, Narberth, Pa. 19072.

The deadline is Oct. 31.

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