Big Business Bias

January 15th, 2019 by Phil Mattera

The immediate culprits in many workplace discrimination and harassment cases are individual managers or co-workers, but in many situations the worst villain is the employer that fails to stop the abuse or engages in its own unfair practices.

The Corporate Research Project of Good Jobs First has just published a report called Big Business Bias showing for the first time which large corporations have paid the most to plaintiffs in discrimination or harassment cases based on race, gender, religion, national origin, age or disability.

As in many other things, the big banks turn out to be leading offenders. Bank of America (including its subsidiary Merrill Lynch) has paid a total of $210 million since 2000, more than any other large company. Morgan Stanley ranks fourth at $150 million and Wells Fargo ranks ninth at $68 million. The financial services industry overall has paid a total of $530 million in penalties. The retail sector has paid the same amount, so the two industries have the dubious distinction of being tied for first place.

The report, based on data collected for an expansion of the Violation Tracker database, covers private lawsuits (both class action and individual) brought in federal or state court as well as cases brought with the involvement of the Equal Employment Opportunity Commission (EEOC) and the U.S. Labor Department’s Office of Federal Contract Compliance Programs (OFCCP). It focuses on cases brought against corporations (and their subsidiaries) included in the Fortune 1000, the Fortune Global 500 and Forbes’ list of America’s Largest Private Companies.

We found that virtually every large company has paid damages or reached an out-of-court settlement in at least one discrimination or harassment lawsuit, but in the vast majority of cases the terms of the settlements were kept confidential. Our report is based on the subset of those cases with disclosed settlements as well as those with public court verdicts and EEOC or OFCCP penalties.

The report finds that since the beginning of 2000, large corporations are known to have paid $2.7 billion in penalties, including $2 billion in 234 private lawsuits, $588 million in 329 EEOC actions and $81 million in 117 OFCCP cases.

Following Bank of America in the ranking of most-penalized large companies are Coca-Cola ($200 million) and Novartis ($183 million). The corporation with the largest number of cases with disclosed penalties is Walmart, at 27. Its penalty total of $52 million would have been much higher if the U.S. Supreme Court had not ruled 5-4 in 2011 to dismiss a nationwide gender discrimination class action against the company.

Following banks and retailers, the industries with the most disclosed penalties are food/beverage products ($252 million), pharmaceuticals ($209 million) and freight/logistics ($187 million).

Race and gender cases (mainly relating to hiring, promotion and pay) account for the largest shares of discrimination penalties, with each category totaling just over $1 billion. Age discrimination cases rank third with over $240 million in penalties, followed by disability cases at $155 million and sexual harassment cases at $123 million.

Employees at all levels of the occupational hierarchy have filed discrimination lawsuits against large corporations. The report documents lawsuits whose plaintiffs range from executives, managers and professionals to blue-collar and service workers. However, it finds that managers are more likely to bring age discrimination cases while racial bias and sexual harassment suits more often are filed by blue-collar and service workers.

In addition to supporting the call by the #MeToo movement to end non-disclosure agreements and mandatory arbitration, the report endorses reforms that would require publicly-traded companies and large federal contractors to disclose how much they pay out each year in aggregate damages and settlements in discrimination and harassment cases.

Note: details on all the cases analyzed in the report can be found in Violation Tracker.

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