Dive Brief:
- Bank of America has paid more than $210 million in disclosed settlement agreements to resolve discrimination claims since 2000 — more than any other employer, according to an analysis by advocacy organization Good Jobs First. Coca-Cola followed close behind at $200 million.
- Big banks filled several of the top-ten positions, as did retailers, according to the report. Industry-wide, the financial services industry and the retail sector both paid $530 million in recent years, while the food and beverage industry paid $252 million. Walmart boasted the largest number of cases but paid out only $52 million — a figure that Good Jobs First said would have been much larger had Supreme Court case Walmart v. Dukes ended differently.
- Race and gender discrimination claims accounted for the largest share of discrimination settlements, the Washington, D.C. based organization found. Age discrimination was next, followed by disability discrimination.
Dive Insight
The report’s authors and other stakeholders have called for an end to mandatory arbitration and non-disclosure agreements (NDAs); the authors also suggested that publicly-traded companies and large federal contractors be required to disclose how much they pay each year in aggregate damages and settlements in discrimination and harassment cases.
Employers, however, have long favored mandatory arbitration because it can keep accusations out of the public eye and is usually less expensive than going to court. Additionally, it's a dispute resolution method that's known to favor employers; as noted in a recent Vox article, employees are statistically less likely to win at arbitration and also more likely to receive smaller settlements.
While Microsoft and Facebook have agreed to end mandatory arbitration for sex harassment claims, Google is facing pressure from employees to abandon the practice.
NDAs, which can prohibit employees from sharing anything from trade secrets to sexual harassment claims, have come into the spotlight as part of the #MeToo movement. Movie mogul Harvey Weinstein, for example, reportedly used NDAs to "evade accountability for claims of sexual harassment and assault for at least 20 years."
But some state lawmakers take a dim view of NDAs and have been pushing back. They introduced bills in 16 states in 2018 to restrict the use of nondisclosure agreements in sexual harassment cases by private employers and the provisions became law in six: Arizona, Maryland, New York, Tennessee, Vermont and Washington, CBS News reported in August 2018. In October 2018, California's governor signed a bill that limits employers' use of NDAs but also vetoed a bill that would have outlawed mandatory arbitration agreements.
On the federal front, Congress targeted confidentiality agreements in the tax bill it passed late last year. "The law bars people from deducting confidential settlements with sexual harassment and misconduct victims as a business expense on their federal taxes," CBS News explained.
