Jobs Bill Would Outlaw Discrimination Against The Unemployed

Over the last couple weeks, President Obama has been traveling the country promoting his proposal meant to reduce unemployment and jumpstart a stalled economy. It generally focuses on targeted tax cuts, extending unemployment benefits, tax credits for businesses that hire new workers, and spending on projects that, in any other time, would probably be pretty uncontroversial, such as funding to repair and upgrade public school buildings, infrastructure repairs, etc.

Today, however, we seem to be in “can’t do” mode when it comes to any ambitious projects, so these will probably be dismissed by many members of Congress as more “wasteful spending” despite the fact that much of it is desperately needed.

Anyway, besides targeted tax cuts and spending to spur job growth, the bill has another interesting feature: it would make it unlawful under federal law for private employers with more than 15 employees to discriminate against job applicants based on their current employment status. Effectively, it bans discrimination against job applicants who are currently unemployed.

This would hardly be America’s first anti-discrimination law. Under the landmark Civil Rights Act of 1964, it’s illegal for private employers to discriminate on the basis of race, color, religion, national origin, or gender. Later on, laws were passed that also outlawed discrimination based on physical disabilities.

This provision in the bill is a response to the perception that simply being unemployed makes it more difficult to get a new job than somebody who is already employed. There’s a strong perception that many employers will simply presume that there must be something “wrong” with an applicant if they’re currently unemployed. Some job ads have even explicitly stated that the currently unemployed need not apply.

This seems particularly unfair in the current economic climate, when a huge number of people are out of work through no direct fault of their own. In the mid-late 1990s, when the United States was nearly at full employment, it might have been understandable for employers to assume that unemployed applicants are somehow undesirable. However, with the job market the way it is, it’s a pretty big stretch to assume that every job applicant who happens to be unemployed was fired, or is unemployed due to a lack of ability on their part.

If the goal of this bill is to reduce the rate of unemployment as quickly as possible, it obviously makes sense to give employers every incentive to hire people who are currently unemployed. With this bill, the administration seems to be taking a “carrot” (tax credits for hiring people who are currently out of work) and “stick” (the anti-discrimination law) approach.

As with all anti-discrimination laws, however, it’s essential to make sure that it doesn’t prevent employers from hiring the most qualified employees, even if that means passing over an applicant who’s in a protected class.

This necessarily makes a discrimination claim difficult to prove, and successful lawsuits under the law would probably be fairly scarce. However, I think a law like this could have some symbolic value, as a gesture to show that the country hasn’t given up on people who have been out of work since the recession began.

Furthermore, it might serve as a morale-booster to the unemployed, encouraging them to increase their efforts to find a job, secure in the knowledge that employers will not be able to take their current employment status into account when making a decision, instead (theoretically, at least) focusing only on relevant factors such as education, skills, and experience.

Ironically, because of the way unemployment figures are calculated (people not actively looking for work aren’t counted towards the unemployment rate), by getting more people back into the job hunt, this bill might actually increase the number of unemployed, albeit only on paper. However, with more people actively looking for work, employers will have a bigger pool of employees to choose from, potentially giving them access to more qualified, and potentially more productive, workers. In the long run, increasing productivity is probably the best way to improve the economy and reduce unemployment.

Ultimately, I doubt that a law like this could do much to reduce unemployment, but I also doubt that it will hurt. I’m sure the bill’s opponents will reflexively label it a “job killer” that puts yet another undue burden on “job creators.” However, during the 1990s, we saw massive economic growth and low unemployment. This was during a period when many antidiscrimination laws were already on the books, and under an administration that was eager to enforce them. I doubt that adding one more category to anti-discrimination laws will place any significant burden on employers.