HOUSTON, Texas. According to the New York Times, California has become the first state to require publicly-held companies to have women on their boards. The new law may have an impact on hundreds of companies, with companies that do not comply facing violations of up to $300,000. The New York Times reports that as many as 25% of companies do not have women on their boards. California is home to many major tech companies, so the immediate impact of the law might be to encourage technology companies to increase diversity at their highest levels. The tech industry has faced major criticism in recent years for its lack of diversity.
Some hope that by promoting more women to company boards, these companies might be able to remake their cultures and prevent the kind of toxic cultures that lead to sexual assault, harassment, unequal pay, and workplace discrimination against women. California’s requirement is the first of its kind in the U.S., but the law is common in Europe, where companies are required to have women on their boards.
Yet, there are some concerns that the California law could create legal concerns and that it could face pushback from organizations. Companies that have no women on their boards may ultimately find themselves making board member decisions based on gender, which goes against anti-discrimination laws. Others believe that there are better ways to achieve gender diversity on boards, either by providing companies with tax breaks or other incentives.
While the boardroom law has received much publicity, California has also passed other laws to protect women from sexual harassment and discrimination. Time reports that in California, smaller companies must also provide sexual harassment training to their workers and companies are no longer permitted to use private settlements to silence women who have been sexually harassed on the job.
Will similar measures ever protect workers in Texas? The California boardroom law is likely to face lawsuits in the coming months. Some companies claim that the law requires them to show preference to people of one gender over another. Other critics of the law claim that it doesn’t promote enough diversity. Some companies have already spoken out, saying that they would have to promote gender diversity over racial and ethnic diversity. Others believe companies should have the autonomy to choose their boards as they wish. The law requires boardrooms to promote members based on gender, but doesn’t address race discrimination, or the lack of ethnically diverse boards.
Moore & Associates are Houston employment law attorneys who work closely with individuals who may have suffered harassment or discrimination on the job. Our firm understands how devastating harassment and discrimination can be. We also are aware of the financial toll that harassment causes. If you believe you have been compensated unequally to male employees, or if you have been sexually harassed or assaulted on the job, you may have certain rights under the law. Reach out to Moore & Associates today to learn more about your rights.
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