This article proposes a novel multidisciplinary and multilevel approach to understanding the complexity of diversity in organizations. Drawing on counseling psychology, developmental psychology, and Black psychology as well as other fields, the authors propose that racial identity theory helps to explain the relationships that develop between minority employees and the White-owned and White-managed organizations that employ them. Specifically, the authors outline four different types of employee-employer relationships that develop depending on the racial identity levels of both the minority employee and the organization as a whole. Understanding these relationships can be a useful diagnostic tool for identifying barriers to effective diversity management and minority employee retention. © 2002, Sage Publications. All rights reserved.