Goldman Sachs Group settled a class action lawsuit for $215m on Monday following allegations made by thousands of women employees nearly 13 years ago.
A joint statement released by Goldman Sachs and the plaintiffs on Monday stated that approximately 2,800 female vice presidents and associates have filed a lawsuit alleging the investment banker has a bias towards women in terms of pay and promotion.
The lawsuit was initially filed in 2010 and involved Cristina Chen-Oster who began working for the company selling convertible bonds in 1997, as well as Shanna Orlich an associate at Goldman Sachs. The women claimed that the bank had denied them equal pay, and promoted them based on their gender.
Orlich’s response to the announcement of a settlement was, “As an original plaintiff, I have supported this case without hesitation for the past nearly thirteen years. I believe that this settlement will benefit the women in my mind when I first filed the case.”
Goldman Sachs agreed as part of the settlement to hire third-party experts in order to investigate any possible gender pay gap within the company.
The company said that it would engage an independent expert who will conduct an additional review of its performance evaluation process, as well as the promotion from Vice President to Managing Director. This is to ensure that they produce accurate, reliable, and non-biased results.
Goldman Sachs, the outside expert, will also “conduct further pay equity studies” and investigate any gender pay gap.
Goldman Sachs will independently continue periodic reviews as it did in the past, the investment banking firm said.
The company announced that it will fill 40 percent of its vice-president positions with women by 2025. Goldman Sachs currently has 29% women partners and managing directors.
Jacqueline Arthur said that both parties had agreed to settle the matter after more than 10 years of litigation.
Arthur continued, “We will focus on our people and clients as well as our business.” She stated that Goldman Sachs “is committed to ensuring an inclusive and diverse workplace.”
The amount of money that each plaintiff receives is approximately $47,000. Another $71 million goes to legal fees.
Kelly Dermody (the plaintiffs’ attorney) called the settlement “historical” for women working on Wall Street.
Dermody stated, “We are proud of our client’s courage and tenacity to see this case through nearly 13 years of litigation.”
The legal counsel for the plaintiffs hopes that the lawsuit will “encourage other companies to reexamine [their] pay, performance, and promotion policies as well as the impact they have on one woman.”