Quality, Equality in Hiring: How 1 Firm Manages : Workplace: In the debate about pending civil rights legislation, a look at Archive Corp. in Costa Mesa illustrates the problems that a private employer faces day to day.

The debate in Congress about proposed civil rights legislation reflects a wide-ranging struggle--between Republicans and Democrats, minorities and whites, liberals and conservatives, and women and men.

On an abstract level, the question is whether businesses should be colorblind in their hiring or attempt to remedy past injustices by hiring and promoting women and minorities at the expense of white males who may not be guilty of discrimination.

Impassioned arguments fly both ways. Conservatives argue that the proposed amendments would force employers to defend against discrimination lawsuits by adopting quotas. Liberals say the U.S. Supreme Court’s conservative shift has eroded the civil rights gains of the past three decades.

But little scrutiny has been given to how affirmative action and anti-discrimination policies actually work in corporate America. A look at Archive Corp., a manufacturer of computer storage backup systems in Costa Mesa with 2,800 employees in several U.S. states and abroad, illustrates how a private employer approaches civil rights issues day to day.

Affirmative action experts outside the computer components company say its representation of minorities and women is good: Nearly half of the Archive work force consists of women or minorities. But, as with much of corporate America, there is room for improvement, particularly in its management circles.

Company officials and outside observers doubt that the pending civil rights legislation--which would amend Title VII of the Civil Rights Act of 1964--would force any dramatic changes at Archive, but they still express concern that it could eventually result in quotas.

“I’m not certain exactly what effect the law could have on us,” said Tag Merrick, general counsel at Archive. “It could create a burden on the company by putting pressure on us to make sure the minority representation is on the level of the general population.”

To ensure that the company complies with existing law, Archive’s watchdogs are its human resources managers, legal counsel and several outside professional consultants and attorneys. The civil rights policies they make can succeed or fail, depending on how well they are adopted by individual managers and communicated to employees.

For some of these enforcers, making sure the company is fair to all employees is simply a matter of good business, or of making the most of a diverse work force. For others, carrying out the task is a matter of conscience. And a few may do it reluctantly because it keeps them out of legal trouble.

Dwight Smith, an associate counsel for Archive who is black, said that he is glad he has the responsibility over legal matters involving equal employment. He does not consider the record-keeping required under affirmative action to be burdensome or unnecessary.

“I take an extra hard look at things to make sure the right thing is being done,” said the corporate attorney, who also handles securities law matters for Archive. “I’m trained as a lawyer, not a black lawyer. But I may be in a unique position to see we are sensitive and that past injustices are not being perpetuated.”

Smith believes that subtle discrimination exists--once, at a former employer, he was mistaken for a Xerox repairman--but he and other employees interviewed for this story say they have never encountered intentional discrimination at Archive.

The Archive workplace, however, is not free of trouble.

The task of carrying out affirmative action became more complicated after Archive gained more workers with the acquisition of Cipher Data Products in San Diego and its out-of-state subsidiaries a year ago. The recession, which has made jobs scarce, has added strain to the task as affirmative action is applied to layoffs as well.

And as the company contracts with the recession, fairness in choosing which employees to lay off has become a more immediate issue than hiring.

“When things get worse in a recession and there are layoffs, there is more stress in the workplace and the (civil rights) issues can become more evident,” said Steve Shoda, a human resources manager. His job is to analyze salaries and make sure no one is trying to manipulate the system to achieve a personal and discriminatory agenda based on race, sex or personal preference.

President Bush’s stance on the civil rights legislation has raised the temperature another notch by reviving questions about whether affirmative action results in reverse discrimination against whites.

Congress is trying to overturn five Supreme Court rulings issued in 1989 that limited an employee’s right to sue an employer for alleged discrimination and to recover damages against employers found guilty.

“There is no doubt in my mind the debate in Congress is meant to obfuscate the whole issue of affirmative action,” said Richard Rosenberg, a Los Angeles labor attorney who counsels Archive on personnel issues. “In terms of reverse discrimination, people feel more comfortable raising the issue when it’s being spearheaded by the President of the United States.”

In a recent Times survey of the nation’s 10 largest employers, most respondents said the proposed amendments would not force their companies to adopt rigid numerical formulas for hiring and promoting women and minorities.

Rosenberg says that even the stricter, Democrat-sponsored bill would not force any major policy changes at Archive. Each of the bill’s major tenets is already a part of California’s Fair Employment and Housing law.

For instance, state law already requires trial by jury instead of judge in discrimination cases. It also allows victims to pursue damages for emotional suffering, and assessment of punitive damages against employers. And California places the burden of proof in discrimination cases on the employer if there is a statistical imbalance, Rosenberg said.

Attorneys who disagree with Rosenberg say that one of the 1989 Supreme Court decisions weakened the state statute and shifted the burden of proof to the employee. As a result, they say, proposed changes in federal statutes represent a threat to employers since they could shift the burden of proof back to the employer and eventually lead to quotas.

Ralph Neas, executive director of the Leadership Conference on Civil Rights, a coalition of 185 civil rights groups in Washington, says the proposed Democratic legislation would only return the country to the law that prevailed for more than two decades, and that law, he adds, did not result in widespread quotas by employers.

Regardless of the revised law’s final form, Archive’s enforcers say they must remain vigilant when it comes to compliance. The company keeps careful tabs on the company’s ever-changing work force. Archive’s record on hiring minorities and women is typical of non-defense employers in the state, consultants say.

The company disclosed that minorities account for 30% of its professional work force--including engineers, accountants, salespeople and other support staff--at the company’s corporate headquarters in Costa Mesa.

Among 148 professionals, Asians constitute 23%, white women 17%, Latinos 4.1% and blacks 2.1%. In management, women account for 19% of 137 managers and executives, and minorities for 8%.

While this isn’t a record that reflects an aggressive social agenda to increase minorities at the expense of white employees, the numbers of minorities and women within Archive suggests no hidden agenda holding back their progress, officials say.

“It never dawns on us to hire any way except by capability,” said Patricia Bratton, vice president of human resources and the highest-ranking woman at Archive. “From a human resources point of view, the rule is to keep the dignity of the employee highest in your mind, whether you are hiring, supervising, or letting them go. The culture of Archive makes us different. We are a small company with big ideas, and being colorblind is one of them.”

To prepare managers to deal with civil rights issues, ranging from how to conduct non-discriminatory job interviews to dealing with sexual harassment, Bratton brings in attorney Rosenberg to hold seminars on the subject every six to nine months. In the seminars, managers and supervisors are trained to handle sensitive matters involving race, gender or age issues.

To avoid harassment suits, Rosenberg says, the law requires that managers know more than just common sense when it comes to treating employees fairly. For instance, racist or sexist jokes made by managers, even in after-hours social settings, can expose the company to a lawsuit, Rosenberg said.

Ideally, a seminar should not make the managers paranoid about offending employees. Rather, it should awaken them to the possibilities of how they can make the most of an increasingly diverse work force, Rosenberg said.

Instead of leaving potential resources in a multicultural work force untapped, managers are encouraged to think of ways to use diversity to the company’s advantage. For instance, having a sales force that is fluent in foreign languages and customs can often clinch an otherwise difficult sale. Using workers to their fullest makes them satisfied and productive.

“When you’re being addressed by lawyers, there is a sense of paranoia,” said Debra Hartman, manager of a sales support unit. “But in everyday business, you realize the training makes you do a better job and it makes the company more competitive because it is getting more out of everyone.”

The company has had few legal tangles with employees in past years. Over the course of a decade in business, five complaints were filed against the company with the state Department of Fair Employment and Housing. Those cases were either settled out of court or dropped due to insufficient evidence.

“Archive has far fewer contested matters than you would expect for a company that size,” Rosenberg said.

To achieve its balanced work force, Archive did not adopt rigid quotas, said Bratton, who has been with Archive since 1981, a year after the firm was founded by D. Howard Lewis. It launched broad recruitment efforts in Southern California, but it generally did not go out of its way to target minorities in its advertising.

The company credits its success to an increasingly diverse labor pool in the area and its equal opportunity policies. Also, unlike many large companies that have been around for decades, Archive recruited its work force during the late 1980s, when much of the technical labor pool was more diverse.

Although it is not required by law, Bratton has a consultant prepare an affirmative action plan every year for Archive to give the company data about its progress and where it could use improvement.

The plan establishes a goal, which is the difference between the percentage of minority groups in the relevant labor pool--such as the population of engineers in Southern California--and the actual percentage of minority groups within the company.

But the plan does not spell out a specific number of minorities or women that must be hired within a certain timetable, Bratton said. The plan helps keep the goals in the forefront of the minds of managers, but it also allows them flexibility to hire the best person for the job, she said.

As a result of the plan’s flexibility, Bratton said she has no fear of a state or federal affirmative action audit.

“An affirmative action plan doesn’t mean you’re picking a number,” said Bruce May, a Newport Beach attorney who counsels Archive. “Nobody is telling a manager that you have to set a hard number to increase your staff, and you certainly don’t need to compromise your standards to meet goals.”

The Archive plan stops short of using aggressive enforcement measures. For instance, the company does not link a manager’s pay to whether a department has met its affirmative action goals, nor does it include affirmative action progress as a factor in performance appraisals.

Bratton said the system works well without such enforcement measures. Human resources officials scrutinize departments and act as overseers, but anything more strict could mean constant intervention in day-to-day management.

Layoffs can create a civil rights minefield. Archive has had its share of them lately with more than 460 people laid off since October. Instead of simple seniority, the company considers its needs and individual performance when deciding which employees to cut.

In the layoff process, affirmative action isn’t tossed out the window, Bratton said, but the fairness of the system is put to the test. The company must sidestep discriminatory actions against minorities or older workers, and it focuses instead on cutting unnecessary functions and unproductive performers.

Within Archive, there are different opinions on the civil rights issue and whether the existing system is doing the job. While employees and managers support the company’s policies, their own private opinions reflect the division within society as a whole.

Kenneth Gerstner, a controller at the company who is white, said he supports equal opportunity action as it was intended several decades ago. But he is wary of any pressures that would lead to the adoption of rigid quotas.

“I have a problem with quotas,” he said. “I think things have to evolve, and I want the system to be fair to all employees under my supervision.”

Anne Niese, a technical project manager, said she believes some kind of enforcement tool should be used by companies to make sure everyone complies with the law. At the same time, she says she believes in working extra hard to set a good example and that she would be upset if she received a promotion simply because she was a woman.

Jess Kendrick, one of the few black engineering managers at Archive, said he believes Archive has made progress on affirmative action and it does not need to implement policy changes such as quotas to achieve fairness.

But he adds that improving race relations in the workplace should be a daily concern. Despite clear policies, he says that some individuals will grudgingly abide by the rules and do little more to ensure that fairness and harmony prevail. That has left him somewhat “disenchanted,” and he is at a loss as to how to deal with subtle discrimination.

“As a black, I do feel resentment among people who don’t know me and don’t know what I can do,” he said. “The issue is always there, and I’m made aware of it several times a day. It is sometimes harder to deal with because it is subtle and it can get in the way of work.”

He would like to see more blacks and Latinos at the company be promoted to high-ranking positions, but he acknowledges that changing the company’s ratios is an “overwhelming” social engineering task that he would be foolish to undertake himself.

“To be oversensitive about it is counterproductive,” Kendrick said. “But to ignore it is naive.”

Archive’s Record on Hiring

Over the past decade, Archive Corp. has diversified its workplace. Although the percentage of minorities at the company has not reached parity with the various groups’ proportions in the general population, the firm has a higher level of minority representation relative to the number of black and Asian managers and engineers in the Orange County labor pool.

(figures are in %)

Blacks Latinos Asians Minorities Women ARCHIVE CORP.,1990 Management 1.4 0.7 5.8 7.9 19.0 Professionals 2.7 4.1 23.0 29.8 25.0 ORANGE COUNTY, 1980 Management 1.3 5.3 4.2 10.8 Engineers 0.8 3.6 7.9 12.3 LOS ANGELES COUNTY, 1980 Management 5.3 10.4 6.4 22.1 Engineers 3.5 6.2 12.1 21.8 GENERAL POPULATION IN 1990 Orange County 2.0 23.0 10.0 35.0 Southern California 8.1 31.2 8.9 48.2 49.9

Note: Figures based on 1980 census results, since 1990 breakouts are not yet available. Current law compares a company’s minority representation to 1980 census results.

Figures for women include both minorities and whites

Engineer category is engineers, architects and surveyors

Source: Archive Corp., Employment Development Department, U.S. Census

Discrimination Cases Filed in California

The number of employment discrimination cases filed in California has risen 24.6% since 1987.

1990 1989 1988 1987 Total cases filed 10,201 7,206 8,325 8,182 SELECTED REASONS Race 2,593 1,740 1,974 1,853 National origin/ancestry 1,332 724 850 1,009 Religious discrimination 245 160 179 155 Physical disability 1,869 1,101 1,365 1,221 Sex discrimination 4,902 3,924 4,107 3,736 Age discrimination 1,680 1,008 1,324 1,365

Source: California Department of Fair Employment and Housing