[allenz]

It isn't short-sighted, because a discrimination lawsuit has unbounded liability and gets widely reported on. Words are temporary and can be whitewashed, whereas few companies can afford an admission of guilt.

In a reputable company, HR will pass the message higher up (probably off the record), and a manager will look at the evidence and make a good judgment. In this case, the evidence is clear, the manager should have been fired, and the employee given a sincere (but not in writing) apology and compensation.

Note that HR is a legal role. HR will never advise an employee to consider filing a lawsuit against the company, but instead dissuade the employee by saying that there isn't good evidence, it was an honest mistake, he has a family to feed, try to work with someone else. The saying exists because advice from HR is not in the employee's best interest.