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Weekly UpdatesThe number and costs of employment discrimination legal claims have skyrocketed in the last 20 years (e.g., Goldman, 2001). These claims can have an enormous impact on both the employee (e.g., financial, emotional/motivational, work/family issues) and the organization (e.g., financial, poor climate (Smither et al., 1993)). For instance, in 2006 there were approximately 76,000 charges filed with the Equal Employment Opportunity Commission (EEOC, 2007) and such charges can be quite costly to the organization in terms of legal fees, lawsuits, reputation, and costs associated with correcting an illegal organizational policy or practice. For example, Texaco, which was found guilty in a racial discrimination lawsuit, paid $176 million in a settlement and then spent millions more creating and implementing a plan to diversify their workforce (Walsh, 1996). It is not surprising then, that this topic has increasingly attracted the attention of organizational researchers (e.g., Bauer et al., 2001; Bies and Tyler, 1993; Goldman, 2001; Groth et al., 2002; Wallace et al., 2006).
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Although this area of investigation has blossomed recently, the vast majority of such studies rely on litigation intentions (e.g., Bies and Tyler, 1993; Lind et al., 2000; Wallace et al., 2006) or self-reported complaints to authorities such as the EEOC (Goldman, 2001, 2003; Lind et al., 2000) as the primary criterion. However, intentions do not always lead to intended behaviors (e.g., Ajzen and Fishbein, 1980) and studies relying on litigation intentions as the criterion may not have painted a very clear picture of the litigation process. Furthermore, the vast majority of studies have been based at the individual level of analysis and this area of research can benefit from studying such variables at the higher organizational levels of analysis due to the strong social aspect of litigation (Goldman, 2001). More specifically, because employee-initiated litigation rests heavily on the social aspects of the work unit, a climate of fairness might buffer against employee discrimination claims, leading to fewer lawsuits. Thus, the primary objective of the present study was to investigate the relationship between rates of employee discrimination claims and rates of actual lawsuits filed. Furthermore, we believe that this relationship can be explained by perceptions of organizational procedures in place to handle formal discrimination claims and the climate that such procedures create (i.e., procedural justice climate). Figure I displays our theoretical model.
Employee-initiated Litigation
One of the criticisms (e.g., Goldman et al., 2004) of litigation research is the reliance on intentions to file a legal claim instead of actual lawsuits as a criterion. Furthermore, rather than explaining the process leading to employee-initiated litigation, the majority of studies have relied on simply predicting litigation intentions. This is problematic because intentions do not always lead to litigation and it is important to investigate why and when complaints do lead to lawsuits. In addition, legal claiming follows a process through a series of decision rules from the initial perceptions of rights violations to actually filing the lawsuit (Goldman, 2001). This process is largely dependent on the social context within which the person perceives the injustice. That is, the decision to file suit against an employer is not solely determined by the perceiver, but rather is determined in conjunction with input from co-workers, supervisors, and other organizational members as well as family members and friends outside of the workplace. For instance, within the transformational perspective of disputing (Felstiner et al., 1980-1981), Goldman et al. (2004) specified a model of legal claiming in which self-categorization theory, attribution theory, justice theory, and social information processing theory explain various steps of the legal claiming process. Following this model, claiming, (1) in which a person seeks a remedy to the problem within the organization, leads to disputing, in which a person seeks a remedy outside the organization, only when an intra-organizational remedy is not identified or is unacceptable (via claiming). Goldman et al. (2004) contend that this could be attributable, at least partially, to the violation of procedural fairness norms, which operate within a social context (cf. Salancik and Pfeffer, 1978) and, in turn, push the employee to file suit.
Theoretical models posit (e.g., Goldman et al., 2004) and empirical research indicates (e.g., Goldman, 2003; Lind et al., 2000; Wallace et al., 2006) that justice perceptions predict intentions. For example, Bies and Tyler (1993), Goldman (2003), and Lind et al. (2000) provided empirical evidence that procedural justice was a significant predictor of litigation intentions. In addition, Goldman (2001) reported that distributive and procedural justice were significant predictors of written and verbal complaints to the EEOC, but did not examine lawsuits filed. In a follow-up study, Goldman et al. (2004) found that procedural justice was more important than distributive justice for a majority of respondents when deciding whether to file suit. Furthermore, Wallace et al. (2006) found that procedural justice moderated the relationship between illegal selection procedures and litigation intentions in such a manner that when procedural justice was high, litigation intentions were low, regardless of the legality of the selection procedure.
Although these studies have furthered our understanding of the litigation process, we believe that justice theory also can be used to explain the relationship between formal intra-organizational employee discrimination claims (i.e., claiming) and actual litigation (i.e., disputing) via the social mechanisms of an organizational procedural justice climate. As such, the hypothesized model in Figure I builds upon that described by Goldman et al. (2004) in that procedural justice has been incorporated within a social network to help explain the link between claiming and disputing.
Procedural Justice Climate and Litigation
Climate is a group- or organizational-level concept referring to the shared perceptions among members of a group or an organization with regard to policies, procedures, and practices. Ostroff, Kinicki, and Tamkins defined climate as an "experientially-based description of what people see and report happening to them in an organizational situation" (2003: 566). Schneider and colleagues (e.g., Schneider et al., 2000; Schneider and Bowen, 1993) have partitioned climate into two forms based on the concept of bandwidth-fidelity: foundation climates (i.e., larger and more encompassing environments) and specific climates (i.e., specific to a given area of interest such as safety, service, creativity). Procedural justice climate can be conceptualized as a specific climate as it is specific to shared perceptions of procedural fairness.
Building off of the justice literature (Gilson et al., 2005; Henle, 2005; Wallace et al., 2006), procedural justice climate has been touted as an important organizational variable (Colquitt et al., 2002) and past research has highlighted the importance of procedural justice climate (Naumann and Bennett, 2000; Dietz et al., 2003). For example, Colquitt et al. (2002) found that procedural justice climate positively predicted team performance and negatively predicted team absenteeism. Dietz et al. (2003) found that organizational procedural justice climate was negatively related to workplace aggression and Naumann and Bennett (2002) found that procedural justice climate positively predicted team performance and helping behavior in teams. Thus, from the limited, yet promising, work that has been conducted on procedural justice climate as a predictor of work unit effectiveness, it appears that a high and strong procedural justice climate has positive effects. As such, further empirical investigations of the influence of procedural justice climate on other organizational outcomes seems warranted, especially as an explanation for employee-employer discrimination litigation.
In the present study, organizational procedural justice climate can be defined as a distinct district-level aggregate perception regarding the fairness of procedures perceived by members of the district (Dietz et al., 2003). It is posited that the creation of norms for procedural fairness ultimately stem from leadership (e.g., management) interpreting formal policies, procedures, and practices into in-action policies, procedures, and practices (Bowen and Ostroff, 2004; Zohar, 2000). That is, we believe that district-level management initially creates the procedural norms by acting as a semi-permeable mechanism that translates formal procedural policy into a working procedural policy, thus putting into action the creation and maintenance of the organizational procedural justice climate. Procedural norms operate in the background as ambient stimuli and help direct district operational functioning by reinforcing appropriate behaviors and punishing inappropriate behaviors (Hackman, 1992). Thus, an organization's procedural justice climate is reinforced by repeated interaction among members of a given work unit (i.e., district) rather than how a specific employee treats another employee. Such repeated interactions lead to the strengthening of procedural norms put in place by management, giving rise to a climate of procedural justice (cf. Feldman, 1984; Hackman, 1992).
Goldman et al. (2004) use justice perceptions to explain the link between blaming (i.e., assigning attributions of causation) and claiming, and use social information processing theory to help explain the transition process from claiming to disputing (i.e., lawsuit filing). However, organizational procedural justice climate also might act as a mechanism that influences the relationship between claiming and disputing. Goldman et al. (2004) contend that because legal disputes are cosily, stressful, risky, and require sacrifice, even employees that see merit in their claims are often hesitant to file a charge due to the possibility of incurring further costs and harm in seeking a remedy. However, if the problem or grievance is not treated appropriately by the organization after being internally claimed (cf. Glasl, 1982), then employees will move beyond the initial "in-house" claim and file a formal charge (i.e., lawsuit). Filing a lawsuit is highly dependent on the individual's interactions with multiple others and the organizational procedural norms that are perceived (i.e., procedural justice climate). That is, if there are norms to the effect that fairness is perceived as high, then it is likely that an individual will believe that the internal review of the claim was conducted fairly and will be less likely to continue to the disputing phase of litigation. However, if procedural justice climate is low, then the employee will probably deduce that the review process was unjust and more likely continue to the disputing phase of litigation. Based on this logic, it is expected that a procedurally fair climate will mitigate the negative effects of employee discrimination claims by actually reducing the number of lawsuits filed due to shared perceptions of procedural fairness.
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