Settling Gender Discrimination Class Actions (Part I)

Eight- or nine-figure settlements of gender discrimination class action lawsuits regularly make news. It seems like discrimination this pervasive – essentially, discrimination as corporate policy – should be a relic of the Mad Men past. To the contrary, in countless companies and even entire industries, discrimination against women is business as usual. The latest example is Novartis, a pharmaceutical company, which settled a gender discrimination class action for up to $175 million last week. (Note that the first legal step in this case was taken seven years ago – keep that in mind before you run out to sue your boss.)

As a lawyer, I spent several years bringing and settling discrimination lawsuits against large employers. I talked with female employees who told similar stories of discrimination derailing their careers and sometimes even damaging their health. I learned that it will take an awful lot to eradicate gender discrimination against women at work.

Company-wide discrimination looks pretty much the same no matter the employer’s industry, region, or public image. Managers deny women opportunities for management training. They deny women in sales the best accounts and territories. When a woman succeeds in building up a previously lackluster account, management takes it away and gives it to a man. Managers exclude women from networking opportunities, management training, and promotions. They deny their female employees awards and recognition that they have earned. Managers penalize women who take legally-mandated leave to give birth or to bond with an adopted child. Offending companies pay men more than their female peers.

Then there is sexual harassment, which can include public humiliation, wildly inappropriate comments, even more wildly inappropriate touching, sexual propositions, public discussions among male employees and managers about their female colleagues’ and clients’ physical appearances or sexual proclivities, you name it. I know of a male manager instructing a female subordinate to unbutton her blouse more before meeting with a male client to increase her chances of making a sale. I know of a male manager raping a female subordinate. And everything in between.

Woe betide the woman who dares to complain about discrimination to Human Resources or to the government agencies responsible for enforcing anti-discrimination laws. The traditional next step is for the company to retaliate against her – never mind that retaliating against someone who complains about employment discrimination violates federal law. Retaliation means not only more of the same for the complaining employee, but worse. A manager who had not been in the habit of humiliating women in front of male colleagues and clients will take it up as a new hobby. Any raises, bonuses, promotions, training opportunities, etc. that management had promised to the woman vanish, never to reappear.

The Novartis complaint includes the detailed allegations of Novartis’s discrimination against 22 women. Combined, their stories cover pretty much all of these bases. One recurring theme is the utter pointlessness of complaining through official channels about discrimination or retaliation. Woman after woman reports that she submitted a complaint to Human Resources, and Human Resources ignored it.

This is not surprising. Human resources originated as a corporate response to the labor movement: companies discouraged employees from organizing unions by offering them newfangled personnel management or human resources departments to address their needs, assuring workers that their employers would take better care of them than unions would. From the beginning human resources was corporate CYA, tasked primarily with protecting the company from threats including unions and legal liability, and only secondarily (if at all) with helping employees. Some companies have moved past that history and created human resource departments that actually support employees, but that is far from the norm.

The Novartis settlement agreement, like many other class action discrimination settlements, focuses on reforming human resources and the complaint process so that it works for employees and not against them. The settlement agreement devotes page after page to detailing the coming reforms.

If all goes according to plan these reforms will be a welcome improvement for Novartis’s women, even if they are only partially successful. Theoretically they will serve three goals: (1) ending ongoing discrimination against individuals who file complaints (“complainants”); (2) preventing retaliation against individual complainants; and (3) deterring discrimination at Novartis. These are all ambitious goals, and perhaps not entirely reachable, but the most implausible is the second. Imagine the scenario: a woman files a complaint with her employer about her male supervisor’s discriminatory behavior. Human resources can warn him not to retaliate; his own bosses can warn him not to retaliate; the company’s lawyers can warn him that retaliation is illegal; but still, realistically, he will retaliate. Maybe he will be smart and it will be subtle. He won’t pal around with the complainant. His performance evaluation of her will be less than stellar. When he has the opportunity to promote somebody, if there is someone else with credentials reasonably similar to hers, guess who will get the promotion. And all this is the best case scenario. A less smart, less subtle supervisor will make the woman’s work life a living hell.

Reforming the human resources department at a company rife with gender discrimination is both necessary and laudable, but it is not sufficient (nor is it all the Novartis settlement agreement provides for – that document is 68 pages long). Ending discrimination can only happen before discrimination starts. Stay tuned for the details in Part II.

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2 thoughts on “Settling Gender Discrimination Class Actions (Part I)

  1. Mr. Moscato says:

    But couldn’t anti-discrimination rules be used by some women as a sort of a “hedge” or an “option” for an otherwise failing career?

  2. […] settlement of the gender discrimination class action against Novartis discussed in the first part of this post takes a stab at making these kinds of changes. It requires Novartis to clarify and systematize the […]

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