Since the passage of the Civil Rights Act of 1964, federal policy has revolutionized employment rights. Equal employment opportunity law, occupational safety and health legislation, and fringe benefits regulation were designed to create employee rights to equal protection, to health and safety, and to the benefits employers promise. In event‐history analyses of data from 279 organizations, this research finds that these legal changes stimulated organizations to create personnel, antidiscrimination, safety, and benefits departments to manage compliance. Yet as institutionalization proceeded, middle managers came to disassociate these new offices from policy and to justify them in purely economic terms, as part of the new human resources management paradigm. This pattern is typical in the United States, where the Constitution symbolizes government rule of industry as illegitimate. It may help to explain the long absence of a theory of the state in organizational analysis and to explain a conundrum noted by state theorists: the federal state is administratively weak but normatively strong.
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