Quantifying progress on ID&E

The next two parts of my series on talent innovation relate to the legal and operational considerations involved in using metrics to track inclusion, diversity and equity (ID&E) initiatives. (Read part one of the series here, and part two here.)

I acknowledge up front that collecting ID&E metrics is not that “innovative.” For years, if not decades, companies have used data to hold themselves accountable for diversity initiatives under the adage, “what gets measured gets done.”

But a lot has changed in recent years. Companies can more easily collect and access ID&E data through Human Capital Management (HCM) software and other digital tools. Employees are increasingly demanding more individualized experiences. And laws relating to equity and human rights are increasing regulatory requirements relating to ID&E metrics, such as pay transparency legislation in British Columbia; Statistics Canada consultation on the appropriate terminology and categories to replace the language of “visible minorities” with appropriate identification of specific ethnic, Indigenous and racialized populations; and the BC government’s consultation on anti-racism data legislation.

With all this change, and the pressure to collect and use ID&E data, it’s important for companies to proceed carefully and thoughtfully. I’ve divided this particular topic in two because there is a lot to get through—including the basic legal concepts to data privacy to building trust with employees.

What do we mean by ID&E metrics?
Generally speaking, these can include:

• Aggregated demographic information used to determine whether processes to encourage diverse hiring and promotion are effective. By comparing demographic data within compensation bands or by role, leaders can determine where to prioritize inclusion and diversity and develop targeted programs.
• Individualized, self-identification metrics used for targeted hiring or promotion of individuals in a particular group in order to increase diversity within senior leadership or on a particular team.

HCM reporting and analytic tools enable HR teams to collect this data. But even with these tools, collecting and using ID&E metrics is not a simple exercise. HR teams are often hesitant to collect this information owing to potential liability and compliance issues. And individual employees and job applicants are often hesitant to disclose the information out of concern for how it will be used or based on past experiences of discriminatory hiring practices.

What can ID&E data be used for?
ID&E data enables companies to measure progress and success (or lack of it), which can then be used to set priorities, develop programs and improve HR processes. The data can identify and verify perceptions about equitable treatment and opportunity, pay gaps, barriers to recruitment, accessibility and diversity in leadership.

Aren’t we not supposed to ask about these kinds of things?
It’s true that many HR teams have been trained not to ask questions relating to protected grounds. This practice is consistent with human rights tribunal recommendations that employers “take care to make sure that interviews are only to get information about qualifications and job requirements needed for the hiring decision.” Applicants and employees are protected from discrimination under human rights laws.

But . . . Canadian human rights laws include an exception for programs intended to improve the hiring and employment experience for equity-deserving groups. In other words, ID&E metrics cannot be used to discriminate against an employee based on a protected ground—but can be used to improve access to opportunities at the workplace.

Isn’t this all just reverse discrimination?
“Reverse discrimination” is not a recognized legal claim in Canada. Canadian human rights laws expressly protect programs intended to address systemic discrimination.

In this respect, Canada is very different from, say, the US. I could write an entire paper on this topic (and I’m sure others have!) but here’s the abridged reason. Our constitutional equality protections, which are set out in the Canadian Charter of Rights and Freedoms, came into effect in 1982, after a US Supreme Court decision that struck down an affirmative action program designed to enable “economically and/or educationally disadvantaged and minority applicants" to apply for admission to a particular post-secondary education program. As the Ontario Court of Appeal would later note, protections of ameliorative programs, as set out in Section 15(2) of the Charter “was undoubtedly included [. . .] to silence this debate in Canada and to avoid” similar litigation.

The Supreme Court of Canada has consistently stated that identical treatment can perpetuate disadvantage and that achieving equality may sometimes require different treatment.

Are we increasing our legal risk by collecting this information?
When companies start to gather ID&E data, there are many unknowns. What if someone leaks the information? What if the data reveals discriminatory practices? Will it open the door to class action lawsuits and human rights investigations?

Getting advice on legal risk is an important initial step to addressing these unknowns. A few considerations to highlight:

• Companies need to protect the integrity and confidentiality of ID&E data, just as they protect other sensitive business and employee data. ID&E information is highly confidential. Even aggregated data could identify the personal characteristics of your employees.
• If the data reveals discriminatory practices, the company will need to take mitigating steps to avoid litigation or regulatory action.
• Unless the information is privileged—for example, gathered for the purpose of litigation or to obtain legal advice—it may be subject to disclosure in litigation or regulatory proceedings.

So, yes, there are legal risks involved in gathering data. But these risks can and should be balanced against the risks of failing to track progress and encourage transparency about ID&E initiatives.

Shouldn’t we just focus on getting the most qualified candidate?
Using ID&E metrics often attracts criticism that hiring or promotions should be based on “merit,” and not on individual characteristics (as an example, see this article).

This question shouldn’t be avoided or ignored. Having a clear answer protects current and prospective employees: no one should have to prove that they deserve to be appointed to their role. But, yes, of course it’s in the organization’s best interest to hire qualified candidates. The goal is not to “fill seats” with a diverse group of employees. It should be obvious that nothing is achieved by hiring an individual who cannot succeed.

But questions about “qualified candidates” and “merit” assume that the company’s hiring processes are equitable, inclusive and accessible. It suggests that only the majority group is qualified to perform the job—without ever taking steps to ensure this is in fact the case. Designing a more equitable program involves scrutinizing the hiring and promotions process. Here are some ways to think about that:

• Are you measuring qualifications objectively or relying on vague references to “fit” or “culture”? What does “qualified” mean? How are qualifications measured? Is there a consensus on the skills required to succeed in the role?
• Are you taking active steps to ensure a diverse candidate pool? Are you, for example, reaching out to community organizations or recruiting agencies that focus on recruiting women, racialized employees, the 2SLGBTQIA+ community, neurodiversity or persons with disabilities?
• Is your company demonstrating in its day-to-day actions, operational decision and messaging that it is an inclusive, equitable and accessible workplace?

By collecting ID&E metrics, the company is in a better position to measure the effectiveness of these programs and identify where more work is needed to attract and retain diverse candidates.

Recap so far: Collecting and using ID&E metrics
To summarize what we’ve covered in this post:

Identify your purpose. Have a plan. Get legal advice.

Gathering ID&E data is critical to moving forward and making progress, but you need to be thoughtful in addressing the talent and legal risk that comes along with gathering information.

In my next post, I’ll address privacy legislation and data protection—and how to respond when employees refuse to provide this data.