Microsoft The company will pay $14.4 million to settle a California lawsuit over allegations that it retaliated against employees who took legally protected leave.
The California Department of Civil Rights Proposed Settlement The settlement, to be announced Wednesday, will be paid in almost full to California workers who took parental, family care or disability leave between 2017 and the present and who chose to participate in the settlement.
“Because Microsoft employees who use or will use protected leave are disproportionately women and people with disabilities, Microsoft’s policies and practices at issue have discriminatory adverse effects on the basis of sex and disability that Microsoft cannot justify on the basis of business necessity,” the agency said.
The lawsuit alleges that Microsoft did not take sufficient steps to prevent managers from considering protected leave when assessing employees’ “impact,” a factor that plays a role in calculating annual bonuses, promotions, stock-based compensation and performance-based pay increases.
According to the lawsuit, Redmond, Washington-based Microsoft employs about 6,700 people in California out of a total of 221,000 employees.
Under CEO Satya Nadella, Microsoft has been working to diversify its leadership and tackle harassment and discrimination.
The percentage of women at partner, executive, director and manager levels has been increasing year by year. According to the company’s latest research, in Microsoft’s core divisions, women will make up 31.2% of employees by 2023, up from 27.6% in 2019. Diversity Report.
Microsoft said it would update its rules on sexual harassment and gender discrimination in 2022 following a shareholder vote after an outside report found problems with the company’s handling of complaints.
The California complaint alleges that employees reported fears of retaliation after applying for protected leave, and the settlement states that Microsoft disputes the allegations.
“Microsoft is committed to helping our employees take time off when they need it and providing the flexibility and support they need to succeed professionally and personally,” a company spokesperson told CNBC in an email. “While we believe the allegations made by the authorities are inaccurate, we will continue to listen, learn, and support our employees.”
As part of the settlement, Microsoft will provide training to employees’ direct and subordinate managers in California, as well as human resources personnel who handle employee bonuses and raises. Managers will also be instructed not to consider protected leave when making “impact” decisions. Consultant APTMetrics will monitor compliance.
clock: Microsoft AI CEO Mustafa Suleiman talks about AI and the future of humanity