California sets quotas for females on boards of directors [UPDATED]

In response to the #MeToo movement, California has enacted several laws regarding sexual harassment claims. You can read about them in this report by the law firm of Mayer Brown LLP. Some provisions make sense, others not so much.

What really caught my eye, though, was a new law not about sexual harassment, but about female representation on boards of directors. The bill is SB 826. Here is how Mayer Brown describes it:

SB 826 provides that, beginning December 31, 2019, publicly held companies with their principal executive offices in California must have a certain minimum number of women serving on their boards of directors. Such corporations must. . .have at least one female on their board by December 1, 2019. Thereafter, boards with five directors must have at least two women on the board, and boards with six directors must have at least three female members by December 31, 2021. Corporations failing to comply with this mandate face significant monetary penalties.

According to this report, the penalties would amount to at least $100,000 for a single violation and $300,000 for each subsequent violation. California is the first state to set such a quota.

There may be a loophole, though. The new law defines female as “an individual who self-identifies her gender as a woman, without regard to the individual’s designated sex at birth.”

Is SB 826 constitutional? I doubt it.

The law unabashedly classifies people by gender for purposes of membership on company boards. The justification is past discrimination and differences in opportunity.

But this is a shaky ground for discriminating in the present, as SB 826 does. Even when we’re talking about African-Americans, a group that has endured more severe discrimination than women, the Supreme Court has, to my knowledge, not adopted past discrimination as a basis for approving quotas.

The Supreme Court prefers the “diversity” rationale. But, assuming for the moments that this rationale has force in the college classroom, how much force does it have in private boardrooms? In any event, the Court has rejected strict numerical quotas for African-Americans. In SB 826, California has imposed quotas for women.

Gov. Jerry Brown seems to recognize that SB 826 is on shaky legal ground. In a letter explaining his decision to sign the bill, he stated: “I don’t minimize the potential flaws that indeed may prove fatal to its ultimate implementation.” But, he added: “It’s high time corporate boards include the people who constitute more than half the ‘persons’ in America.”

Sure, but not high time to set illegal quotas. Gov. Brown’s attitude is emblematic of the left’s growing disregard for the law.

UPDATE: Years ago, Jim Scanlan pointed out that a remedial/reparations rationale for preferring women doesn’t make much sense. That’s because women of a current generation aren’t any more harmed economically by past discrimination against their mothers and grandmothers than men of a current generation are. By contrast, African-Americans of a current generation are harmed by past discrimination against their mothers and fathers.

I doubt that females from past generations would consider it a fair reparation to see their sons and grandsons discriminated against in favor of women.

Responses

Books to read from Power Line