Dispute Resolution and the Glass Ceiling:
Ending Sexual Discrimination at the Top
by Linda Stamato
In the following article, Linda Stamato uses two recent highprofile cases involving women executives who attempt to "raise the ceiling" in the workplace--one positive and one negative--and shows how the implementation of ADR programs can encourage positive employment practices and eliminate bad ones--especially when it comes to issues involving women. This article has been adapted with permission from the October 1999 issue of Alternatives published by the CPR Institute.*
Carleton (Carly) S. Fiorina, an executive at Lucent Technologies, was selected by Hewlett-Packard as its president and chief executive in July 1999. A major rival for the post was another woman, one of the many women managers at Hewlett-Packard, of which their numbers are reported at over 2 5 % and climbing.
Andrea Jung, a marketing whiz, in November 1999, became the CEO of Avon Products, the second-largest U.S. company to be run by a woman; she joined Jill E. Barad, then CEO at Mattel (she resigned on Feb. 3, 2000) and Marion Sandler at Golden West Financial Corporation.
Cracks are occurring in the glass ceiling. But, fissures they're not. Consider also the following: Allison K. Schieffelin, a principal in Morgan Stanley Dean Witter & Company's equity division, contends that she was passed over for managing director because of her gender. She filed her complaint against the firm with the U.S. Equal Employment Opportunity Commission--a necessary first step to filing a suit. In July, the EEOC took Morgan Stanley to court to force the firm to release data on its employment practices for senior female employees.
The contrast in the experience of the recently selected CEOs and that of Ms. Schieffelin is so striking that it invites comparison and analysis.1
The stories of these women have generated a good deal of national coverage; contemplating the connection, in counterpoint, though, is a more productive endeavor, even compelling, because doing so provides insights into practices that corporations in America might usefully consider both in terms of (a) internal policies and practices that attract, retain, and reward productive employees and (b) mechanisms and practices that provide for informal handling of potential discrimination cases within the corporation and external methods that reduce the time, cost, and damage of litigating those that become formal claims and complaints.
These possibilities and their relation to the world of alternative dispute resolution inspire this article.
In what still remains a male-dominated corporate world, women are increasing their representation in high-status occupations. The Bureau of Labor Statistics (1997) reports that women make up 44% of managers, 56% of accountants, 30% of attorneys, and 27% of doctors. An annual study by the University of Chicago, measuring research degrees, reported an increase in degrees by women by more than 50% in the same year.2 Women are contenders for positions at the top.
There are critical layers to fill, however. While the number of women who are chief executives at Fortune 500 companies doubled in the last five months with the ascension of Fiorina and Jung, that number started from the meager base of two. Catalyst, the New York-based nonprofit group that studies women in the workplace, reported in November 19993 that women are seriously under-represented in the "line officer" jobs that lead to promotions. About 11.9% of the 11,681 corporate officers in America's top five companies are women (up from 8.7% five years ago, however), but only 6.8% of line jobs are held by women.
Whether women will attain positions at executive levels in American corporations, in significant numbers, is no longer the question, but rather, what will it take for them to get there, and at what cost. Think of it this way: do corporations attract, reward, and retain the best employees? And, what do they do to protect employees--and the corporation--against discrimination?
Lack of Opportunity
In the extensive coverage of the Schieffelin case, there was a significant amount of discussion about how rare it is to find a woman willing to stay and fight when "most women who think they are encountering the glass ceiling simply quit."4 Confirmation of this view is offered by Catalyst: A recent initiative, exit interviews with more than 500 women managers who left more than 20 companies in the 1990s, found nearly three-quarters reporting that "they were greatly influenced by their belief that there was a lack of opportunity for advancement." There was still further confirmation at Deloitte and Touche, where a committee of senior partners, in 1992, who were asked to investigate why so many women were leaving the firm, found that both those who left as well as those who stayed expressed concerns about opportunities for moving up. (Evidently, Deloitte took this and related findings seriously, altering policies and taking actions that have produced a drop in the percentage of women who leave each year from 29% in 1991 to 18% in 1999).5
According to Catalyst: "There's absolutely no doubt that more and more smart companies recognize the importance of the female talent pool."6 By promoting gender diversity, and by raising the issue's visibility by spotlighting companies that create a corporate culture in which women can advance, as Catalyst and the Working Woman's survey do, doesn't hurt.7 Indeed,such features as "The 50 Most Powerful Women in American Business," in Fortune magazine8 can keep the issue of advancing women at the top on the front burner, but, they can also create the impression that "the problem is solved." Given the paltry numbers of women in the executive suite and in the positions that feed the top, there is a long way to go before that happens.
The confidential nature of mediation
can make it an attractive option for women who
allege sexual discrimination in the workplace.
There are significant barriers to overcome. Discrimination against women remains a persistent pattern. Consider two examples:
- The first of six regions studied with respect to gender discrimination--Washington State--found that one of every four workplaces discriminates against women. By industry and by job category, women in Washington face a 17% chance of being discriminated against each time they seek employment or promotion;9 and
- American women seeking to climb the corporate ladder via overseas positions face steep odds. While females account for some 30% of students in MBA programs, they're only 14% of those chosen by corporate America for foreign postings. Why? According to studies by Loyola University in Chicago and Loyola Marymount College in Los Angeles in 1999, male bosses in multinational corporations "express unfounded bias against American women in overseas positions," exaggerating the problems women executives may face that results in "hampering females' selection for such assignments."10
If globalization is a primary driving force in shaping the economy, and few doubt that it is, then the direct and indirect discrimination against women in overseas assignments could be very significant indeed.
Perceptions about discrimination are as critical as they are problematic. If a woman is not promoted and believes she is qualified, how does she account for not making it? Discrimination is one possible explanation but not necessarily one that many women wish to assert even if they suspect it. Women hesitate to speak up because they are not sure that they are being discriminated against or they don't like the choices for challenging decisions that are present in their firms (or the potential negative impact, in their firms, and beyond, in the industry at large). Promotions are not assured by any means; people may be bypassed for a variety of reasons, including that their talents go unrecognized. Looking elsewhere may seem the least onerous (and the more promising) avenue.
Unquestionably, for the corporation, retention is an important part of the picture. If there is a perception that opportunities for advancement are not available, women will look elsewhere. And good managers will be lost.
Policies and Practices to Raise the Ceiling
Consider, in this regard, the employment pattern at Hewlett-Packard. The company reports that it loses fewer than 5% of its employees each year, compared with an industry average that the consulting firm William M. Mercer puts at 17%.11 It wasn't this way in the early 1990s, however. Then, the turnover for women was twice that of men. Now that the gap has been eliminated and the rates are almost identical, the question is why? In short, the introduction of a new CEO in 1992--Lewis E. Platt--and a serious commitment to workplace strategies that encouraged diversity. The key thing is that Platt's policies were not seen as simply the right thing to do but the smart thing. "Anything you can do to attract and retain the best talent is really critical," Platt is quoted as saying in the New York Times.12 As if to confirm his point, the Dow lent a sweet note. For example, when Fiorina's appointment was announced, Lucent's stock fell and HewlettPackard's gained. (Similarly, the announcement of Jung's ascension to CEO brought an increase in Avon's share price, by two-and-a-half-an especially significant move since it had been falling in recent months).
So, policies that promote (and practices and commitments that encourage) retention of the best employees may well raise the ceiling for women at the same time that these policies, in retaining the best employees, return benefits to the corporations where they work. Second, frequent communications about job performance and expectations is essential. Executive-level employees, as others, need to know where they stand and what they need to do to improve prospects for promotion. And, standards for promotion and expectations of performance need to be understood and followed in order to minimize the ambiguities and uncertainties that can lead to disappointments and, ultimately, either to the loss of good managers or to the retention of dissatisfied--perhaps unproductive--executives, or to legal contests for damages.
Policies and practices along these lines are important dimensions; so are those that provide opportunities for executive-level employees to sort out their reactions to potential discriminatory behavior and decide how to deal with their perceptions and unfulfilled expectations.
Conflict Management on the Inside
Much has been written about employee grievance procedures and the need for integrating informal, problem-solving opportunities at early stages. This observation is no less vital to those at executive management levels, but special considerations are warranted, given the needs and interests--and difficulties--that are more likely to surface at this level.
The organizational ombuds model offers an attractive means to satisfy these concerns, not only because individuals may benefit from the assistance that an ombuds office can provide, but because institutional change, where warranted, is more likely to result.13
In cases of imagined or actual discrimination, what can an ombuds do? The ombuds can serve as (a) a counselor, to listen and identify options for dealing with, for instance, a denial of promotion; (b) a negotiator, to mentor and coach and guide a person through to an acceptable result; (c) a mediator, to help create integrative solutions among the parties; and a mediator can serve too as (d) a "risk manager," an essential link in the corporation, to bring attention to issues that might present serious liabilities or, less grave, might warrant policy or procedural changes to improve conditions generally. These activities can be taken without any formal filing of a grievance, a step, as noted above, many women managers are loath to take.
Having a high-ranking person to talk with, one who, is knowledgeable about the organization (and is thus in a position to assess possible "interventions" in light of that knowledge), and who is also neutral, independent, and committed to confidentiality may be an attractive prospect to a woman. This is important for a woman who wants to assess her situation, weigh her options, decide, with advice and counsel, whether and how to proceed, and generally craft an informed and secure decision about what to do, whatever it may be. Moreover, the ombuds model allows this process to take place in a safe way, affording an avenue for individuals who, according to authors Ellen Waxman and Howard Gadlin, "for reasons of organizational politics, personal animosity or past history, might be worried about the prospect of reprisal if they pursue their concerns through the formal administrative hierarchy." With the ombuds, they have a way to raise sensitive concerns, such as suspicions of sex discrimination, and because it is clearly in the corporation's interest to encourage such concerns to be raised, the independence, confidentiality, and informality offered by the ombuds office has primary (and protected) status and importance.14
The ombuds has the flexibility to construct approaches to situations that take into account the nature of the problem, the circumstances in which it occurs, and the underlying needs and interests of the parties involved. At the same time, the ombuds understands that he or she intervenes not merely to address individual conflicts and problems but also to take account of the corporation so that if systemic problems--patterns of abuse or discriminatory practice-are identified, the ombuds has the responsibility and the authority to bring these matters to the appropriate level of management and to recommend changes in policy or practice (or personnel) to rectify them.
The strength of the ombuds as an alternative to leaving the job, bringing a formal grievance, or filing a lawsuit, rests with the status and the creative and effective functioning of the individual serving as ombuds. It is a critical role in which the ombuds is "in" but not "of' the corporation, is neutral and independent, but who networks and collaborates to establish good working relationships throughout the corporation. A well-designed and executed ombuds program can go a long way to providing a meaningful outlet--producing an end or an informed next step in the process--for a woman who believes she may be experiencing discrimination. For the corporation, the benefit is clearly in providing a means to uncover practices that its policies do not condone and to retain employees that add value to its bottom line.
Mediation: An Alternative to Litigation
Statistics do suggest that effective internal processes do reduce the incidence of litigation, and that ombuds programs have a good record in this regard.15 However, some cases will proceed to formal, adversarial processes, and here too, dispute resolution offers promise. Many women reject bringing lawsuits that allege discrimination, even if they believe they have grounds, because they question whether the result is worth it. Litigation can make life even more difficult for women by making the workplace even less friendly. Janet Hanson, who spent 14 years at Goldman, Sachs before founding her own investment firm, told The New York Times that "it was hard enough to be part of the inner sanctum," but "I think it is going to be much, much harder" if women turn increasingly to the courts for relief.'16 And, companies are making it increasingly difficult to get there; some require employees, as a condition of employment, to mediate and/or arbitrate their grievances before proceeding to court. In view of the negatives associated with litigation, and the reluctance of women to go there, this limitation can also be seen as a potential benefit.
Why mediation? Paradoxically, the attractiveness of alternatives to formal litigation grows in proportion to the seriousness accorded an offense by law. Congress and the federal courts raised the ante with respect to discrimination, both by the Civil Rights Act of 1991, and subsequent decisions allowing workers the right to a jury trial and punitive as well as compensatory damages; and plaintiffs have recovered significant damages for acts of discrimination.17 The stage is firmly set to advance the proposition that mediation is a viable means to satisfy interests with respect to potential discriminatory practices. With discrimination accorded serious attention by courts, meeting interests through informal mechanisms is more likely to be achieved.
It is worth noting in this regard the EEOC's use of mediation, not only its impact on cutting its backlog of pending cases, from a high of 111,451 in June 1995 to slightly more than 52,000 in 1999 as a result of a pilot program inaugurated in 1997,18 but, at the same time, the agency has vigorously pursued a series of high-profile class-action discrimination lawsuits. It negotiated a $34 million settlement in a sexual harassment suit against Mitsubishi Motor Corporation's American subsidiary last year, and a $183 million settlement in 1997 in an age-discrimination complaint that had been filed against Lockheed Martin's predecessor, Martin Marietta. And, in September of 1999, the Ford Motor Company agreed to pay $7.75 million to as many as 900 women to settle complaints alleging sex harassment and, at the same time, to pay for training by outside consultants at Ford plants across the nation at a cost estimated by the EEOC at $10 million. The Ford settlement is the fourth largest sex-harassment settlement in the history of the EEOC. Moreover, the settlement provides that more women will get management positions, and that supervisors who see sex harassment and do nothing about it will be ineligible for promotions and bonuses.
Title: The Balance of Power:
Lithograph by Honoré Daumier(1808-1879).
Difficulties can occur for women in the
workplace when power is abused.
And, now, the EEOC is taking on Morgan Stanley on behalf of Ms. Schieffelin. The agency's director, Ida Castro, says that by diverting cases into mediation, "we can invest our resources to go after the really bad actors, those companies that simply refuse to adhere to the law,"19 And, by going after "these companies," and thus clarifying and establishing precedents in Federal employment discrimination law, the agency makes the argument for mediation all the more compelling.
Mediation doesn't exist solely to offer quicker, easier resolutions and to relieve the burden on individuals, institutions, agencies, and courts, but also with respect to potential discrimination cases, to help individuals achieve better and more lasting resolutions of value to themselves, and to assist corporations in meeting and protecting their interests as well.
In this light, consider the process qualities and the remedies or outcomes that are likely to be sought in a situation of potential sex discrimination. Why might a woman choose mediation? She may want to: avoid a protracted investigatory process and obtain immediate relief; preserve her privacy and avoid the stress of formal, adversarial proceedings; confront the situation, and possibly the person or persons involved, in a way that provides both an opportunity to relate directly what she feels and why--so as to educate rather than to accuse--and to preserve future working relationships should they continue.
Given that subjectivity and ambiguity may enter the picture, raising doubt about whether discrimination did take place, a woman may wish to avoid being twice victimized, both by "the discriminator" and by the process, and choose the informality and confidentiality that mediation affords. Moreover, establishing blame is seldom high on the list of outcomes sought by the person who suspects discrimination. Why use a system, litigation or variations on the fact-finding or arbitration theme, that seek to find fault and levy costs or impose sanctions?
Discrimination, much like harassment, is often clouded by different perceptions of what took place and of what was expected or intended. Ordinarily, one would anticipate that parties holding different--even clashing--perceptions of a pattern, an occurrence, a problem, a conflict, or a complaint, would draw different conclusions as to how to deal with it; agreement would seem unlikely. Discrimination situations often fall into this category. Different perceptions may be genuine; in those situations, mediation affords an opportunity for the alleged discriminator to put his intentions aside and see what the woman who alleges that discrimination occurred believes she experienced. Often, however, the question is not a difference in perception, but denial or intentional misrepresentation of what occurred. In both cases, though, mediation affords each party an opportunity to see the other's perspective without having to agree with it, and presumably, to reach an agreement that satisfies future needs and interests without having to share the same view of what took place (or didn't).
Sex discrimination is also often about power. Thus a process that allows a woman to enter as an equal, that encourages dealing with discrimination and violations of trust, is essential. Mediation allows for respectful communication, and because solutions and remedies are voluntarily and mutually arrived at, compliance rests on--and makes responsible and accountable-- both parties. Thus, mediation can be empowering. And, unlike formal systems, the way a problem is defined, interpreted, or "framed" in mediation, rests with the parties; so does control over the process and crafting remedies or solutions.20
There are many "external mediation providers" who offer services to individuals and corporations--the American Arbitration Association and the Center for Public Relations prominent among them. Many smaller firms and individual mediators provide this service. Availability is not a problem.21
The critical thing, in making mediation an attractive option, is the context in which it occurs. Commitment by the corporation to a discrimination--free workplace is essential, requiring both policies and practices that sensitize managers--indeed all employees--to what may constitute discrimination; that provide for services for employees (counseling, education, training); that encourage employees to surface concerns with respect to advancement opportunities, among other things, and that include appropriate sanctions for failure to comply with core corporate values in this regard. Mediation can only be effective in a corporation (or external to it) if the workplace in which the dispute arises values freedom from discrimination as a serious objective.
The corporation of the future enhances its competitive position by attracting and retaining the best talent, and, for women, opportunities for advancement are critical among the factors likely to make a difference in this regard. On the way to "this future" are many obstacles, not the least of which are continuing, pervasive patterns of discrimination against women. As women attempt to shatter glass ceilings, corporations should minimize the collateral damage by putting effective dispute resolution mechanisms in place. Organizational ombuds programs and external mediation options can aid the effective management of individual cases but also assist the corporation in identifying policies or practices (or people) that are producing discriminatory results. Thus can the way to the future be made a little less hazardous; at the same time, perhaps, we might get there faster.
* The CPR Institute is a nonprofit initiative of 500 general counsel of major corporations, leading law firms, and prominent legal academics, whose mission is to install alternative dispute resolution (ADR) into the mainstream of legal practice.
1 And, Ms. Jung's case adds a dimension here as well: her selection comes less than two years from the date that a high-profile executive search passed her by, along with three other women on the inside, in favor of a male outsider with no experience in direct selling or cosmetics: Dana Canedy, "Opportunity Re-Knocks at Avon," The New York Times C1, 18 (Nov. 5, 1999).
2 The New York Times Al 7 (11/4/99).
3 USA Today Al (11/12/99); Eileen Alt Powell, AP, (11/12/99); and "Trends: Executive Women at the Top: Still a Very Lonely Club," The New York Times G1 (Nov. 17, 1999).
4 Reed Abelson, "If Wall Street is a Dead End, Do Women Stay to Fight or Go Quietly?" The New York Times Al, C6 (Aug. 3, 1999).
6 "Twenty five Top Companies for Executive Women," Working Woman 52-64 (Sept. 1998).
7 Working Mother magazine produces the Top 10 Best Companies to work for, an annual survey that rates companies in the following categories: parental leave, flexibility in work schedules, child care, pay scales, and opportunities for women to advance.
8 October 25, 1999.
9 Alfred Blumrosen, interim report to the Ford Foundation, 1999.
10 Business Week 28 (Sept. 13, 1999).
11 Reed Abelson, "A Push From the Top Shatters a Glass Ceiling," The New York Times Al, 33 (Aug. 22, 1999).
13 For a succinct and solid account of the evolution of the organizational variation on the ombuds model that began in Sweden and what it can offer to a corporation, see Ellen Waxman and Howard Gadlin's article, "A Breed Apart: Ombudsmen as Buffer Between Institutions, Individuals," in the ABA Section of Dispute Resolution's special issue of Dispute Resolution Magazine on Innovations in Process: New Applications for ADR (Summer, 1998).
14 Op.Cit., 23.
15 For example, an ombuds program at Texaco, launched in February 1998, yields the following data: EEO allegations at Texaco declined from 83 in 1997 to 34 in 1998 and litigation activity shows a similar finding: new cases opened in 1997, 110; new cases opened in 1998, 56. There were no adverse determinations by the EEOC or state agencies against Texaco in 1998. Cases that were resolved in court decreased to 10 in 1998, which is less than half the level of the previous two years. Ninety-three court matters remained unresolved at the end of 1998 versus 125 matters at the end of 1997. "Texaco Task Force on Equality and Fairness Issues Second Annual Report to U.S. District Court," Business Wire (Aug. 2, 1999).
16 Abelson, Op.Cit., Aug. 3, 1999, C6.
17 Recent decisions, however, provide companies with greater protection against punitive damages if they have solid policies against discrimination and act in good faith. See, for example, the Supreme Court's decision in Kolstad v. American Dental Association, 98-208 (June 22, 1999).
18 Steven A. Holmes, "Jobs Discrimination Agency Lightening Its Load," The New York Times Al, 15 (Feb. 22, 1999).
20 There are additional values to mediating employment disputes, many of which are particularly well described by Jean R. Sternlight in her article, "Lawyers' Representation of Clients in Mediation," Ohio State Journal on Dispute Resolution, vol. 14, no 2, 1999, pp. 269-366. See, especially in this regard, pages 332-345.
21 Indeed, a National Employment Dispute Resolution Act of 1999, NEDRA, has been proposed by Professor Lamont E. Stallworth of Illinois and Larry Rute, Esq. of Kansas, to establish a national program of directed mediation for certain employment disputes, "a process of structured negotiation, assisted by a qualified mediator, designed to achieve a full, fair and voluntary resolution," distributed at the ABA Conference in Boston, April 30, May 1, 1999.
The author is deputy director at the Center for Negotiation and Conflict Resolution at Rutgers University's Bloustein School of Planning and Public Policy n New Brunswick, N.J., a teaching and research institute that also provides technical assistance. She had a mediation practice that specializes in complex matters, and she does training and writing in academic, corporate, and legal contexts.
This article was originally published in Dispute Resolution Journal, February 2000. The Dispute Resolution Journal is the journal of the American Arbitration Association.
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