By Robbie Whelan
Disney agreed to pay $43.3 million to settle allegations that it systematically paid female middle managers less than men in similar roles over the course of a decade, avoiding a potentially costly and distracting jury trial.
The settlement agreement, which was filed Monday in a California state court, still requires approval by a judge. It represents a major step toward resolving a legal tussle that began in 2019, when LaRonda Rasmussen, a product manager who still works at Disney, sued the company.
Lawyers for the nine female plaintiffs in the suit, which was granted class certification last December, had argued that Disney paid women at least $151 million less than men in comparable positions across several divisions of the company, in violation of California workplace sex discrimination laws.
Disney has disputed the allegations, and in Monday's proposed settlement agreement continued to deny any wrongdoing.
"We have always been committed to paying our employees fairly and have demonstrated that commitment throughout this case, and we are pleased to have resolved this matter," a Disney spokesperson said.
Before 2018, the plaintiffs in the case claimed, Disney started female employees at lower pay rates than their male counterparts, in part because their pay was often based on prior salaries at other companies, and Disney failed to factor in pre-existing gender pay disparities.
Defending its pay patterns, Disney has pointed to a 2022 internal pay-equity review, conducted at the behest of shareholders, that found women at the company earned 99.4% of what men earned. The company also argued that the lawsuit shouldn't be certified as a class action, saying last year that since pay levels are set by hundreds of managers across different divisions of the company, and many jobs with similar titles require different tasks, discrimination claims must be adjudicated individually.
As part of the settlement, Disney would need to retain an organizational psychologist to train its compensation team on benchmarking jobs to external market data. For the next three years, the company would also agree to have an outside labor economist perform a pay-equity analysis for full-time, nonunion, California employees below the level of vice president.
Lori Andrus, the lead plaintiffs' lawyer in the case, said not every resolution of a pay-equity dispute includes this kind of requirement and commended Disney for committing to it.
"It was a long discussion that we had, and I think a very productive one, " she said. "Both parties are satisfied to put this behind us."
Write to Robbie Whelan at robbie.whelan@wsj.com
(END) Dow Jones Newswires
November 25, 2024 22:03 ET (03:03 GMT)
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