Employment discrimination law exposures for international employers: A risk assessment model

The purpose of this paper is to use a risk management perspective to identify the risks of employment discrimination law liability for multinational employers.

Data from 101 US Federal Court cases that involved multinational employers operating both inside and outside of the USA were content coded and then used to identify factors that predict the frequency that foreign employers operating inside the USA – and US employers operating outside the USA – were subject to lawsuits under US employment discrimination laws.

This study found that employment lawsuits based on sex discrimination against females was the most significant risk exposure. Employers whose home country was from a Western culture were at comparatively greater risk for charges of both age and religious discrimination. Employers whose home country was from an Asian culture were at comparatively greater risk for charges of both race and national origin discrimination.

This study demonstrates the viability and usefulness of a risk management framework for examination of issues related to law and management.

This study enables the identification of risk factors that multinational employers can use to strategically target their loss prevention efforts in order to more effectively and efficiently avoid or reduce potential liability for employment discrimination.

The risk factors identified in this study can help employers to take efforts to reduce employment discrimination in their multinational operations, thereby reducing the frequency and likelihood that such discrimination may occur.

This is the first study to use a risk management framework to empirically identify employment law risk exposures for multinational employers.