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HR can never know for sure exactly what’s going on in other parts of the organization. That means it’s easy to be blindsided by a sudden lawsuit.

For example, co-workers sometimes spread unfounded rumors about who is up for promotion and who will be bypassed. Such gossip may dissuade some employees who wanted the promotion from applying for it and give them an excuse to find a reason to sue—such as race discrimination or retaliation.

While there isn’t much you can do about water-cooler talk, there is something you can do to protect the organization from its fallout. Simply put, make sure you have a solid, objectively based promotion process that promotes the most qualified person.

Recent case: Sheldon Hall, who is black, worked for the Michigan State Police and filed an EEOC complaint, which he eventually dropped. Then, several years later, he applied for a promotion.

The state police used a standardized test to rank those who would be interviewed and then picked the highest-scoring candidate—a black woman. But she declined the promotion, and the department reopened the promotion process.

This time, Hall didn’t bother applying because he heard from a co-worker that management was still mad about his earlier complaint. Others told him that management had already selected the candidate, and it wasn’t Hall. He sued for retaliation and discrimination.

But the department showed the court the objective process it used and pointed out that Hall hadn’t even put his hat in the ring the second time. The court sided with the state police, noting that rumors aren’t the same as direct evidence of discrimination. Plus, it was clear that there was no discrimination during the first round, since a black female had been chosen. The court tossed out Hall’s case. (Hall v. Michigan State Police, No. 06-2116, 6th Cir., 2008)

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