Legal Intermediaries: How Insurance Companies Construct the Meaning of Compliance with Antidiscrimination Laws

Abstract

SHAUHIN TALESH Existing empirical research suggests that human resource officials, managers, and in-house counsel influence the meaning of antidiscrimination law by communicating an altered ideology of what civil rights laws mean that is colored with managerial values. This article explores how insurance companies play a critical and, as yet, unrecognized role in mediating the meaning of antidiscrimination law through Employment Practice Liability Insurance (EPLI). My analysis draws from, links, and contributes to two literatures that examine organizational behavior in different ways: new institutional organizational sociology studies of how organizations respond to legal regulation and sociolegal insurance scholars' research on how institutions govern through risk. Through participant observation at EPLI conferences, interviews, and content analysis of insurance loss prevention manuals, my study bridges these two literatures and highlights how the insurance field uses a risk-basedlogic to construct the threat of employment law and influence the form of compliance from employers. Faced with uncertain legal risk concerning potential discrimination violations, insurance institutions elevate the risk and threat in the legal environment and offer EPLI and a series of riskmanagement services that build discretion into legal rules and mediate the nature of civil rights compliance. My data suggest that insurance riskmanagement services may sometimes be compatible with civil rights goals of improving equality, due process, and fair governance in workplace settings, but at other times may simply make discrimination claims against employers more defensible.

How Legal Intermediaries Facilitate or Inhibit Social Change

“…In these situations, organizations do not resist or avoid law, but instead, respond by creating written rules, procedures, and structures to fill in law's meaning. As organizations legalize themselves, managerial and risk logics influence the way in which organizations understand law and compliance (Pélisse, 2011b;Talesh, 2015a;Edelman, 2016).…”

“…More recently, scholars have started to broaden the framework beyond managerialization and explore how other non-managerial logics influence the way that organizations understand the meaning of law and in particular, the role of intermediaries who are not legal professionals (Pélisse, 2014(Pélisse, , 2016. Consumer, risk, science and prison logics emanating in various organizational fields can influence the way that organizations understand the meaning of law (Stryker, Docka, & Wald 2012;Verma, 2015;Talesh, 2012Talesh, , 2014Talesh, , 2015a. Managerial logics can be in contestation with logics or work in complimentary ways (Talesh, 2015a).…”

“…Consumer, risk, science and prison logics emanating in various organizational fields can influence the way that organizations understand the meaning of law (Stryker, Docka, & Wald 2012;Verma, 2015;Talesh, 2012Talesh, , 2014Talesh, , 2015a. Managerial logics can be in contestation with logics or work in complimentary ways (Talesh, 2015a). Moreover, managerial, risk, labor or consumer conceptions of law shape the way public legal institutions such as legislatures (Talesh 2009(Talesh , 2014Pélisse, 2009), courts (Edelman et al, 1999;Edelman, 2005Edelman, , 2007, regulatory agencies (Talesh, 2012(Talesh, , 2015c and arbitration forums (Talesh, 2012) understand law and compliance.…”

“…Specifically, the insurance field (insurance companies, agents, brokers, and risk management consultants), through EPLI and the accompanying risk ma-nagement services that the insurance field offers, construct the threat of employment law and influence the nature of civil rights compliance (Talesh, 2015a). Drawing from participant observation and interviews at EPLI conferences across the country as well as content analysis of EPLI policies, lossprevention manuals, EPLI industry guidelines, and webinars, Talesh shows how insurance companies and institutions use a risk-based logic and institutionalize a way of thinking centered on risk management and reduction.…”

Legal Mobilization within the Bureaucracy: Disability Rights and the Implementation of Antidiscrimination Law in Sweden

“… Shauhin Talesh has made the same argument in his analysis of the role of insurance companies in constructing compliance with antidiscrimination law in the United States (Talesh ).…”