Such policies are very tricky and controversial - EEOC's position is that such policies potentially have a disparate impact on ethnic/national origin minorities (see 29 C.F.R. § 1606.7).
Courts will uphold such policies if they are based on business necessity, such as public safety, customer service, or minimizing complaints from other employees - the burden is on the employer to show such necessity (see Garcia v. Spun Steak Co., 998 F.2d 1480 (9th Cir. 1993); Dimaranan v. Pomona Valley Hospital, 775 F. Supp. 338 (C.D. Ca. 1991); Roman v. Cornell University, 53 F. Supp. 2d 223 (N.D. NY. 1999); and EEOC v. Premier Operator Services, Inc., 113 F. Supp. 2d 1066 (N.D. Tex. 2000)).
Prior to implementing such a policy, an employer should, if possible, have documentation to support whatever business necessity exists, such as reports of safety problems, comments from customers about lack of service, or complaints from coworkers that speakers of a different language appeared to be commenting about them in such a way that they felt excluded or targeted.
The policy should be carefully focused on the business needs at issue - unless there is a compelling reason to do otherwise, do not attempt to prohibit speaking of other languages during non-duty times; if employees need to speak a language other than English in order to better do their jobs; or while employees are speaking among themselves in another language in a context that does not suggest they would be aware that others who do not speak that language would consider themselves somehow "talked about" or excluded (this consideration applies not only in the context of different languages - it is certainly possible for English speakers to create morale problems by the way they talk around each other and about others, and it is important for employers to address such concerns anytime they become aware of the issue).
The company should consider whether there are any alternatives to a blanket rule. If poor conduct (unkind remarks) was only an isolated incident by certain workers, and there is no widespread incidence of discriminatory remarks in other languages, simply handle the problem via counseling that is directed toward the ones who caused the problem.
Even the most well-written policy can be useless if the managers are not properly trained in how to explain and apply it; for example, if a manager tells employees that the policy prohibits any speaking of a minority language, even during breaks, a fact issue arises which can make it much harder to deal with a discrimination claim or lawsuit (see Maldonado, et al. v. City of Altus, Oklahoma, 433 F.3d 1294 (10th Cir. 2006)). Thus, proper training is essential, and human resources staff and top management should carefully monitor how the policy is actually applied in the workplace.
The main idea is that such a policy should be applied no more than is necessary to get the job done well and to minimize friction between employees - beyond that, employees should be left to whatever language they prefer to use.
The policy should remind all employees, regardless of what language they speak at a particular time, that cooperation and good communications are vital to the company's interests and that they will be held accountable for the degree to which they exhibit good teamwork and effective communications with coworkers and customers.
Once employees understand that smooth relations and effective communications have a direct bearing on advancement opportunities and potential pay raises, they will generally handle language issues accordingly.
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