8 Ways Employers Can Discriminate Against Workers -- Legally

I talk lots about illegal discrimination, but there are many forms of employment discrimination that are perfectly legal. Here are some of the types of discrimination that may be legal if they happen to you:

1. Bankruptcy
The Bankruptcy Code says: "No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or bankrupt under the Bankruptcy Act, or an individual associated with such debtor or bankrupt . . . ." Yet several courts have decided that this provision does not apply to potential employers. The 3rd, 5th and 11th Circuit Courts of appeal say you may be denied employment due to your bankruptcy.

2. Political Views
Some, but not all states have laws prohibiting discrimination based upon political affiliation. But in most situations you can be fired because you exercise your right to free speech and express political opinions. Only government employees have First Amendment rights. The one big exception is that the National Labor Relations Act says you can't be fired for discussing working conditions, including discussing which candidates would be best for working conditions. For more information about political discrimination, you can check out my blog post on the topic.

3. Favoritism
Many Americans think favoritism at work is illegal. It isn't. Discrimination against you because you're you is legal. If you're being subjected to favoritism because of your race, age, sex, religion, national origin, disability, pregnancy, color or genetic information, that is unlawful discrimination. If you have to complain, make sure you complain about something illegal. Your employer can retaliate against you legally for complaining about favoritism, but they can't legally retaliate for reporting discrimination.

4. Nepotism
I get emails all the time complaining about employers who favor family members and friends. Playing favorites is not illegal. Hiring relatives is not illegal -- not if you're in the private sector. If you work for government, every state has some law about conflict of interest or hiring relatives at a certain level. Under Sarbanes-Oxley, management has to disclose potential conflicts of interest. So hiring of relatives, while probably legal even for publicly-held companies, can't be hidden from shareholders. If the favored few are all of the same race, religion, national origin or other protected category, the company could be engaging in illegal discrimination. If the boss favors only individuals who have engaged in sexual relations with her, and you've turned her down, you might have a sexual harassment claim (although sexual favoritism is mostly legal).

5. Appearance
Very few states or municipalities have prohibitions against appearance discrimination, and there are no federal laws against it. Sometimes, women are subjected to appearance standards when men are not (or vice versa) and that would probably be illegal discrimination. But hating someone because they're beautiful? Probably legal.

6. Credit History
If your state is like most, an employer can refuse to hire you due to bad credit. Some states finally got wise and passed laws against using poor credit history as the basis for employment decisions. If your potential employer is going to run a credit check, then they must comply with the Fair Credit Reporting Act. The EEOC is looking closely at the use of credit reports in employment decisions because they frequently have a disparate impact on women and minorities.

7. Weight
As I wrote in my article on weight discrimination, it's mostly legal. A very few states and municipalities have limitations on appearance or weight discrimination. Otherwise, if you're morbidly obese you are likely protected under disability discrimination laws. If you need medical treatment for a condition relating to your weight, you may be protected for the days you miss work under the Family and Medical Leave Act. If you're held to different standards than members of the opposite sex, it might be sex discrimination.

8. Unemployment
Discrimination against the unemployed is indeed legal. Many companies consider unemployment to be a factor that automatically disqualifies applicants. Unemployment discrimination is rampant. While a handful of states (New Jersey, Oregon, D.C.) have passed laws against unemployment discrimination, it's legal almost everywhere in the United States. Other states have tried to pass laws and failed or been vetoed. President Obama has proposed the American Jobs Act, which has many provisions that will help put Americans back to work. Included in that law is a prohibition against discriminating against the unemployed, but it hasn't passed yet. Unemployment is having a disparate impact on older workers and minorities, so you might be able to pursue a discrimination claim if you've been subjected to unemployment discrimination and a less qualified younger employee or person of a different race, sex or national origin was hired.


So there you have it. Lots of types of discrimination are illegal. (Hopefully employers won't use this as a primer on legal discrimination.) However, some of these "legal" kinds of discrimination may also have an illegal effect. Try to look around and see if what's happening at work is really about sex, race, age, disability, pregnancy, national origin, or some other type of illegal discrimination.


If you need legal advice, it's best to talk to an employment lawyer in your state, but if you have general legal issues you want me to discuss publicly here, whether about discrimination, working conditions, employment contracts, medical leave, or other employment law issues, you can ask me at AOL Jobs. Please note: Anything you write to me can be featured in one of my columns.

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