Google’s Equal Pay Lawsuit: One More Tech Firm Challenge

In a first for the company, Google now finds itself on the defensive regarding gender bias in its pay and promotion of employees.

While this is a new claim for Google, it is only the latest instance of a tech giant battling such claims in the courtroom, coming behind companies like Oracle America, Inc. and Microsoft Corp., both of which have faced similar accusations.

Three former female employees – Kelly Ellis, Kelli Wisuri and Holly Pease – filed suit in mid-September in California Superior Court in San Francisco. The women, who no longer work for Google, allege that they were paid less than male coworkers for doing similar work and were placed on lower job ladders, leading them to miss out on opportunities for promotions, bigger bonuses and raises. The lawsuit seeks back pay and compensation – including stock and bonuses – and an order that Google change its policies.

The women have also asked the judge for class-action status so they may sue on behalf of all women employed by Google in California over the last four years.

That request hints that the plaintiffs believe the sex bias issue at Google is pervasive, an assumption that is given weight by an ongoing U. S. Department of Labor (DOL) investigation into Google’s compensation practices. The DOL analyzed data on 21,000 Google employees for 2015 and, according to the lawsuit, “That analysis found systematic compensation disparities against women. Pretty much across the entire workforce”.

Google denies the claims made in the lawsuit.

How this plays out in the courts remains to be seen, but what is apparent is that discrimination against women seems to be plaguing the tech industry.

Earlier this year, the U.S. Department of Labor filed a lawsuit against Oracle America, Inc. alleging the company has a practice of paying white male employees more than their female and/or minority peers. The DOL claims that this led to pay discrimination against females, African-Americans and Asians.

Along with its worldwide ventures, Oracle has received hundreds of millions of dollars in federal government contracts. As a federal contractor, Oracle is prohibited from engaging in employment discrimination on the basis of race, color, sex, sexual orientation, gender identity or national origin, and is required to take affirmative action to ensure equal employment opportunity is provided to applicants and employees. As a result, the Office of Federal Contract Compliance Programs (OFCCP), an agency of the DOL, requested that all government contracts be canceled and that Oracle be barred from future federal contracts.

Microsoft Corp. is also facing a sexual bias lawsuit, which argues that a former system of performance review led to fewer pay raises and promotions for women in technical roles.

Other tech companies who have found themselves in sexual bias law suits include Twitter, Inc. (2015) – accused of creating a glass ceiling for women in promotion practices – and Qualcomm Inc., which settled a class-action sex discrimination lawsuit last year for $19.5 million.

How can you avoid these challenges?

Review teamsThe tech industry seems to be getting most of the attention in the courts recently, but tomorrow it could be your company or field under the looking glass.

Sometimes company policies unintentionally result in unexpected and detrimental outcomes in the HR realm. Google officials would likely tell you that they have developed a well-intentioned system of checks and balances to avoid any bias in compensation practices, although now it is up to the courts to decide if that system was enough.

This dilemma is not restricted to any particular industry. So, the time is always now when it comes to reviewing your compensation policies and routinely checking up on them to minimize the opportunity for bias against women and minorities. You should have a review team that includes women and minorities who can represent the concerns of other employees.

External input: Google claims it has adequate policies to avoid pay discrimination, and they just may. But obviously “adequate,” like beauty, is in the eye of the beholder.

That room for subjectivity suggests that hiring an external consultant or firm is valuable for an unbiased review. There are compensation specialists and industrial-organizational psychologists who can help you look at the potential impact of your hiring practices and compensation programs. You can include them in a pre-emptive effort or, in a less-desirable situation, hire them as expert witnesses in your court defense.

Ombudsman: An employee’s decision to approach an attorney, the EEOC or the OFCCP is typically based on his or her perception of unfair treatment. Most employers are well-meaning while developing policies for compensation and promotion; after all, it’s not only good for business but simply the right thing to do.

We see too many cases where a lack of understanding leads to a disgruntled employee. Transparency can go a long way. One safety valve for avoiding that disgruntled employee – and avoiding potential legal challenges – could simply be an ombudsman that works within your organization.

Giving your employees an opportunity to learn more about what went into the decisions that affect their compensation and an opportunity to provide feedback could go a long way toward their acceptance of those policies.  Offering an avenue to a third-party arbitrator goes a long way, too, because they feel heard, recognized and more secure knowing checks and balances are in place.

David Smith, Ph.D., is the president and CEO of EASI•Consult®. EASI•Consult works with Fortune 500 companies, government   agencies, and mid-sized corporations to provide customized Talent Management solutions. EASI•Consult’s specialties include leadership assessment, online pre-employment testing, survey research, competency modeling, leadership development, executive coaching, 360-degree feedback, online structured interviews, and EEO hiring compliance. The company is a leader in the field of providing accurate information about people through professional assessment. To learn more about EASI•Consult, visit www.easiconsult.com, email ContactUs@easiconsult.com or call 800.922.EASI.

EASI·Consult® is the registered name for Expert Advocates in Selection International, LLC.
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