Goldman Sachs Group agreed to settle a class-action lawsuit on Monday for $215 million following allegations made nearly 13 years ago by thousands of female employees.
Approximately 2,800 female associates and vice presidents joined a lawsuit against Goldman Sachs, alleging that the investment banking company showed a bias against women regarding pay and promotions, according to a Monday joint statement from the company and plaintiffs.
Initially filed in 2010, the lawsuit involved Cristina Chen-Oster, who started working for the company in 1997 selling convertible bonds, and Shanna Orlich, an associate with Goldman Sachs. Both of the women accused the bank of refusing them equal pay and promotions based on gender.
Orlich responded to the settlement announcement, stating, “As one of the original plaintiffs, I have been proud to support this case without hesitation over the last nearly thirteen years and believe this settlement will help the women I had in mind when I filed the case.”
As part of the settlement, Goldman Sachs has agreed to recruit third-party experts to examine any potential gender pay-gap within the company.
“Goldman Sachs will engage an independent expert to conduct an additional analysis on performance evaluation processes, as well as its process for promotion from Vice-President to Managing Director, to ensure they generate accurate, reliable, and non-biased outcomes,” the company stated.
The outside expert will also “conduct additional pay equity studies and … Goldman Sachs will investigate and where appropriate address any gender pay gaps.”
“While this is a three-year commitment, Goldman Sachs independently will continue such reviews periodically as it has in the past,” the investment banking firm added.
The company also announced plans to fill 40% of its vice president positions with women by 2025. Currently, 29% of Goldman Sachs’ partners and managing directors are women.
The company’s global head of human capital management, Jacqueline Arthur, said, “After more than a decade of vigorous litigation, both parties have agreed to resolve this matter.”
“We will continue to focus on our people, our clients, and our business,” Arthur added. She noted that Goldman Sachs is “committed to ensuring a diverse and inclusive workplace.”
Each plaintiff will receive approximately $47,000; another $71 million will go toward legal fees.
Kelly Dermody, the plaintiffs’ counsel, called the settlement “historic” for women on Wall Street.
“We are very proud of our clients for their courage and tenacity in seeing this through almost 13 years of litigation,” Dermody said.
The plaintiffs’ legal counsel hopes the lawsuit will encourage “other companies to reexamine their pay, performance and promotion policies and the impact it has on one woman.”
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