People

Salesforce plans to hire the laid-off family and friends of its staff. What about diversity?

Seeking to fill 2,200 positions, the company says it will prioritize hiring current workers' contacts who've lost jobs due to the coronavirus pandemic.

Salesforce Tower in San Francisco

Salesforce, whose tower dominates San Francisco's skyline, has sought to be a leader in workplace diversity efforts.

Photo: 615 Productions

Salesforce, known for calling its employees "ohana," is taking that family mentality up a notch. Seeking to fill 2,200 positions, the company says it will prioritize hiring current employees' friends and family members who've had the misfortune of losing jobs due to the COVID-19 pandemic.

"If an employee uses the #workingtogether hashtag in their referral," a company spokesperson said in an email, "their candidate will be prioritized."

As unemployment surges, the San Francisco cloud software company's initiative was met with a good deal of praise. A tweet about it by CEO Marc Benioff racked up nearly 2,000 likes by 5 p.m. Monday, and observers called it well-intentioned. But the plan also raised questions about diversity in hiring — a longstanding problem in the tech industry. Silicon Valley was built by friends and co-workers who relied on their personal and professional networks, which institutionalized a lack of diversity.

Salesforce has sought to be a leader in this area, focusing for years on diversity and equal-pay issues. The company has declared that it aims, by 2023, to have half of its U.S. workforce made up of underrepresented groups, including racial minorities, women, LGBTQ workers, people with disabilities and veterans.

The company famously spent an additional $3 million in 2015 after Benioff ordered a review of Salesforce's gender pay gap and found that women and men were not paid equally. In the past few years, the tech giant has touted gains in diversifying its workforce, such as boosting the hiring of women by 2% in 2019 — though its hiring of minorities such as black, Latino, indigenous and multiracial employees inched up just 0.3% last year.

Told of the strategy, some observers who've studied workplace diversity said Monday that prioritizing referrals from employees' friends and family members carried obvious benefits but could affect Salesforce's progress on diversity.

The company spokesperson would not answer additional questions about the program, which a Salesforce employee said was announced internally via email last week. The company's code of conduct, released publicly and available online, does not address such referrals, noting only that working with relatives can lead to conflicts of interest; the legal department is supposed to approve family members working under the same "reporting chain."

"Most businesses in this country have been based on the good-old-boys network," said Paul Goodman, technology equity director at the Greenlining Institute, an Oakland nonprofit organization that advocates for economic opportunity for minorities. "There's a high-tech version of that. You have to be very intentional about offering those opportunities." Goodman added, of the Salesforce initiative, that he "appreciates the intent behind it because we're in a weird time."

Karen Jaw-Madson, a Silicon Valley management consultant and principal at Co.-Design of Work Experience, agreed. "The benefits of this approach are obvious," she said. "It builds goodwill and reputation, funnels opportunities to the unemployed, and enhances community when people get to work with their friends. However, there are potential downsides and unintended consequences to avoid, especially when it comes to reinforcing social inequality that comes with 'who you know.'"

Robert Jones, a professor emeritus in Missouri State University's psychology department who has specialized in nepotism and prejudice, noted that hiring friends and family members can "be a civil rights or discrimination issue, but it falls in both directions." He pointed to lawsuits that have targeted anti-nepotism policies, alleging that they can end up working against women, who have been denied jobs at their husbands' companies.

"If you're from a family where there's not an advantage, or from an underrepresented group, maybe [nepotism] would be beneficial," he said.

In the case of Salesforce, though, current employees are still largely white and male. In its most recent diversity report, the company said its U.S. workforce is 62% white, 26% Asian and Indian, 4% Hispanic or Latinx, and 3% black or African American. Nearly 3% identified as multiracial, 0.3% as Native Hawaiian or Pacific Islander, and 0.2% as American Indian or Alaska Native. Almost 65% of its workforce is male, and 35% is female.


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Jones said that while many companies rely on employee referrals, "There's a distinction between recruitment and referral and hiring. The actual hiring process needs to be fair."

Goodman offered a word of caution about Salesforce's strategy. "It brings up the same problems you always see in situations like this," when companies rush to take action, he said. "Issues of diversity don't get addressed."

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