Google has agreed to pay $118 million to settle a class-action gender discrimination lawsuit involving approximately 15,500 women.
According to the press release accompanying the settlement, Google is also required to have an independent labour economist evaluate its hiring practices and pay equity studies.
The lawsuit first surfaced in 2017 when three women filed a complaint accusing the company of underpaying female employees in violation of California’s Equal Pay Act, citing a wage disparity of approximately $17,000.
According to the Equal Pay Act, as amended starting January 1, 2019, employers may not explain any pay disparity between employees of opposite sexes, or employees of different race or ethnicity, based on an employee’s former wage.
According to the California Government’s Department of Industrial Relations website: “The amended Equal Pay Act prohibits an employer from paying any of its employees wage rates that are less than what it pays employees of the opposite sex, or of another race, or of another ethnicity for substantially similar work, when viewed as a composite of skill, effort, and responsibility, and performed under similar working conditions.”
Additionally, it states that under current law, an employee must demonstrate that he or she is being paid less than an employee or employees of the opposite sex, a different race, or a different ethnicity who are performing substantially similar work. Once an employee has demonstrated this, the employer must demonstrate that the pay disparity is legitimate.
An employer can defeat an Equal Pay Act claim by proving that the difference in pay for substantially similar work is due to seniority, merit, a system that measures production and/ or a bona fide factor other than sex, race, or ethnicity.
The complaint against Google claimed that Google forces women into lower-level positions, resulting in lower pay and bonuses when compared to their male counterparts. Last year, the plaintiffs were granted class-action status.
It is noteworthy that more than once, Google’s handling of employees has been questioned. Google agreed to pay $2.5 million to resolve a complaint alleging that it underpaid female engineers and ignored Asian job applications last year.
Meanwhile, the California Department of Fair Employment and Housing (DFEH) is also looking into allegations of possible harassment and discrimination against Black female employees at the corporation.
However, as reported by The Verge, Google said in a statement: “While we strongly believe in the equity of our policies and practices, after nearly five years of litigation, both sides agreed that resolution of the matter, without any admission or findings, was in the best interest of everyone, and we’re very pleased to reach this agreement.”
Additionally, it said that the company is absolutely committed to paying, hiring, and levelling all employees fairly and equally, and it makes “upward adjustments” if a pay disparity between male and female employees is discovered.