Google settled a class-action lawsuit that claims it underpays its women employees by agreeing to pay $118 million and to open its hiring practices to independent review, according to reports.
The lawsuit, sparked by former employees, covers 15,550 employees that are women working in California since 2013.
“While we strongly believe in the equity of our policies and practices, after nearly five years of litigation, both sides agreed that the resolution of the matter, without any admission or findings, was in the best interest of everyone,” a Google spokesperson told Fortune.
Not admitting fault, Google is also allowing third-party advisors to examine how it sorts new recruits into levels upon hiring.
Google will have a labor economist review its pay equity studies, which the company says it uses to monitor and correct pay disparities across its employees. Google used its studies to make “upward adjustments” for almost 3,400 employees in 2020, which totaled $4.4 million.
Google’s Sorting Levels
Reports also state that Google places new hires on different levels depending on experience. The plaintiffs in the lawsuit argued that the company assigned women to lower job levels than men with the same experience or education, based on lower pay at their prior employment.
The plaintiffs also indicated that they were given lower-level assignments and opportunities than their male colleagues, making it harder for them to climb the corporate ladder within the company.
In a statement, one of the plaintiffs, Holly Pease, affirmed that Google settling the lawsuit and agreeing to third party review will help to mitigate these issues for women.
“As a woman who’s spent her entire career in the tech industry, I’m optimistic that the actions Google has agreed to take as part of this settlement will ensure more equity for women,” she said.
The lawsuit was launched by three former employees in 2017, with a fourth joining later. According to Bloomberg, the plaintiffs accused Google of breaking California’s law on gender discrimination, arguing that women at the company made $16,794 less per year than their male counterparts.
A California judge granted the lawsuit class-action status in 2021, which is a hard feat for lawsuits against big tech companies, allowing the four plaintiffs represent thousands of employees.
A History Of Discrimination-Based Lawsuits
Google has dealt with discrimination-based suits before. In February 2021, Google paid $2.5 million to settle a lawsuit from the U.S. Department of Labor alleging the company disadvantaged female and Asian applicants.
The company is also reportedly under investigation from California’s Department of Fair Employment and Housing regarding harassment against Black female employees, according to The Verge.