[header] How to tactfully handle a racist boss [title] Stay calm. [step] Becoming visibly upset as a result of your boss's racist words or behaviors will usually make the situation worse. If you're the target of the racist remark, you might feel like lashing back. 
If you're not the direct target, you might have a desire to defend whoever was the intended target. But if you're looking for a way to handle the situation tactfully, you'll need to calm down first.