Goldman Sachs said Monday it would pay $215 million to settle a lawsuit that accused the bank of systematically discriminating against thousands of female employees. The money will be divided among some 2,800 women and the bank has agreed to change some of its practices.
The amount of the individual payment itself is less than it might appear: subtracting legal fees, it comes to approximately $47,000 per claimant. Still, the deal is the latest effort for Wall Street to address what critics say are years of unequal and unfair treatment of women workers.
The lawsuit accused Goldman of hindering the career advancement of women and paying them less than their male colleagues. He took particular aim at the company’s performance review process, which they said favored men, grooming them for promotions and higher pay.
Introduced in 2010 by three former employees, the lawsuit gained class action status in 2018 and covers women who held associate or vice-president titles in Goldman’s investment banking, investment management and securities divisions. A trial had been scheduled for June.
“I am proud to support this case without question for the past nearly 13 years and believe this settlement will help the women I had in mind when I filed the case,” Shanna Orlich, one of the original plaintiffs in the lawsuit, said in a statement. .
Jacqueline Arthur, Goldman’s head of human capital management, said the firm was “proud of its long record of promoting and advancing women and remains committed to ensuring a diverse and inclusive workplace for all of our people.”
Wall Street has sought to address gender inequality and discrimination in recent years, after facing a long list of complaints. Smith Barney, for example, paid $150 million in 1998 to settle a lawsuit alleging he tolerated a hostile work environment that included wage discrepancies and derogatory language toward women.
Since becoming CEO of Goldman, David Solomon has talked about trying to increase diversity at the company, including through to establish objectives by how many of your new employees should be women. Last year, the bank said a record 29 percent of its newest class of associate managing directors, its highest rank, were women.
Beyond pay, the agreement stipulates that Goldman will hire independent experts to study its performance review process and conduct pay equity studies for three years, as well as change the way it makes the case for career advancement with vice presidents.