After less than a year of litigation, Novartis (NVS) has agreed to pay $8.2 million to settle a proposed collective class action lawsuit filed by more than a dozen female employees who claimed they were denied equal pay and promotional opportunities because of their gender.
The settlement, which must still be approved by a federal court in New York, would involve much less than the $110 million that was initially sought by former and present employees at the company’s Alcon (ALC) Laboratories eye product unit. However, one of the women has not agreed to the settlement.
The lawsuit had gained notice, in part, because the women claimed the company fostered “a boys’ club atmosphere and mentality” that is hostile to women and restricts access to leadership positions, according to court documents.
The lawsuit also came nearly six years after the drug maker agreed to pay $152.5 million to settle a gender-discrimination class action lawsuit brought by several female sales representatives. In that case, the company reached a deal after a jury awarded $250 million to the sales reps.
A Novartis spokeswoman confirmed that a settlement had been reached but declined further comment. A spokeswoman for the lawyers representing the employees and former employees of Novartis’ Alcon also declined to comment.
The original lawsuit was filed last March by just two employees but was later expanded as a proposed collective class action lawsuit and included other past and present employees. The lawsuit charged that women comprised less than 15 percent of senior Alcon management positions, and that this contributed to the alleged discrimination.
The women also claimed companywide metrics were used to assess job performance that were “subjective and used to downgrade the performance ratings of female employees,” because final decision-making authority is given to Alcon managers who are primarily male, according to the lawsuit.
The one former employee who did not settle, Elyse Dickerson, charges she encountered discrimination after requesting promotions, according to the lawsuit. A former global director of pharmaceuticals, she later filed a complaint with the Equal Employment Opportunity Commission and was fired while on a medical leave, the lawsuit states. She also claims her termination occurred shortly before $750,000 in stock grants would have vested.
As we have noted in the past, this was just one of several sex discrimination lawsuits to be filed against big drug makers in recent years. The lawsuits emerged as the pharmaceutical industry shed thousands of jobs, including in ways that may have left the companies vulnerable to charges of discrimination.
The same law firm representing the Novartis employees — Sanford Heisler Kimpel — had also filed the earlier case against the drug maker, as well as lawsuits against Merck, Daiichi Sankyo, and Forest Laboratories, which is now part of Allergan (AGN). All of the companies denied the charges.