Compliance Blog

Company Agrees to Pay $10 Million to Settle Discrimination Suit

April 10, 2018 | Paul Glavin

Hostile work environment discriminated against women and minorities

Before the wave of #MeToo and #TimesUp cases began piling up, a popular ride-hailing company and its culture were triggering conversations about what can happen when online sexual harassment complaints are not taken seriously, and there is no real commitment to fostering a diverse workforce.

In the latest development, the company has agreed to pay $10 million to settle a class-action discrimination suit brought on behalf of 420 female and minority software engineers. The employees alleged gender and race discrimination and a hostile work environment that denied them pay, promotions and benefits.

In many ways, this is a textbook case for what can happen when an aggressive workplace culture ignores repeated complaints of harassment, discrimination and abusive behavior, and becomes, for some employees, a hostile work environment.

A quick recap:

  • In February 2017, a former software engineer took to her personal blog to detail persistent sexual harassment and gender bias by her male manager. She wrote that the manager sent her multiple chat messages, saying he was in an open relationship and looking for women to have sex with.
  • When the employee reported the situation to HR and upper management, her complaints were dismissed because her abusive manager was a “high performer.”  Other women engineers shared their harassment stories involving the same manager, and HR ignored their complaints too.
  • The strong public reaction to her blog post set in motion an investigation into the company’s corporate culture, followed by the resignation of the CEO.
  • Another investigation into more than 200 claims of sexual harassment, discrimination, bullying, retaliation, and other inappropriate behavior resulted in the firing of 20 employees.
  • In March 2018, the company agreed to pay $10 million to settle a discrimination and hostile work environment class-action lawsuit.

How do you know if you have a hostile work environment?

Employers are responsible for protecting employees against conduct and behaviors that create an “intimidating, hostile, or offensive environment,” the EEOC says. This is not the occasional rude comment. To qualify as a hostile work environment, unwelcome conduct must be so severe or pervasive that it interferes with an individual’s ability to do their job.

Hostile work environment harassment can manifest in either physical or verbal conduct of a sexual nature, such as comments, unwelcome touching or requests for sexual favors. And anyone can be affected by a hostile work environment, not just the target of the harassment.

Here are some examples of behaviors that can contribute to a hostile work environment:

  • Discussing sexual activities or making sexually explicit remarks
  • Telling or emailing offensive jokes involving race, sex, disability, age, national origin, religion or other protected characteristics
  • Commenting on physical looks and attributes
  • Engaging in unwanted physical contact, such as hugging or touching
  • Displaying sexually suggestive or racially insensitive images on a company device
  • Using demeaning or inappropriate slang or epithets
  • Making crude, indecent gestures

Traliant Insight
This is a tough lesson about what can happen when employees complain about harassment and discrimination and HR and senior management fail to take action. Yes, it’s about leadership, accountability and promoting diversity and inclusion. It’s also about educating and training employees at every level on their responsibility to contribute to a respectful work environment, and to report incidents of harassment, without fear of retaliation. The other lesson for HR and supervisors is to treat all complaints seriously by ensuring a prompt, thorough and impartial investigation and, as the EEOC says, taking “swift and appropriate corrective action.”

For more information, view our Preventing Discrimination and Harassment course overview