An illuminated logo appears on Microsoft's booth at Mobile World Congress 2024 in Barcelona on February 26, 2024.
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Microsoft is paying $14.4 million to settle a California lawsuit over allegations the company retaliated against employees who took legally protected days off.
The California Department of Civil Rights has announced that proposed scheme on Wednesday. After approval by a state judge, nearly all of the money will go to California workers who took parental, caregiver or disability leave from 2017 to the present and who decide to participate in the settlement.
“Because Microsoft employees who use or will use protected leave are disproportionately women and people with disabilities, Microsoft’s challenged policies and practices also have a discriminatory negative impact on the basis of gender and disability that Microsoft cannot justify on the basis of business necessity,” the agency said.
According to the complaint, Microsoft is not doing enough to prevent managers from considering protected leave when assessing an employee's “impact,” a factor that is taken into account when calculating annual bonuses, promotions, stock options and salary increases.
Microsoft, headquartered in Redmond, Washington, employs about 6,700 people in California, out of its total workforce of 221,000, the complaint said.
Under CEO Satya Nadella, Microsoft has tried to diversify its top roles while also becoming more responsive to issues of harassment and discrimination.
The percentage of women at partner, executive, director and manager levels has increased over the years. Within Microsoft’s core, women will represent 31.2% of the workforce in 2023, up from 27.6% in 2019, according to the company’s latest report. diversity report.
In 2022, Microsoft announced, following a shareholder vote, that it would revise its policies on sexual harassment and gender discrimination. This came after a report from an outside group flagged problems with the company's handling of complaints.
Employees have reported concerns about retaliation after requesting protected leave, the California complaint says. The proposed settlement says Microsoft disputes the agency's claims.
“Microsoft is committed to an environment that allows our employees to take time off when needed and provides them with the flexibility and support they need to thrive professionally and personally,” a company spokesperson told CNBC in an email. “While we believe the agency's allegations are inaccurate, we will continue to listen, learn, and support our employees.”
As part of the settlement, Microsoft will provide training to direct and second-level managers of employees in California and to HR staff members who deal with their bonuses and merit increases. Managers will also be instructed not to consider protected leave when making “impact” decisions. A consultant, APTMetrics, will be responsible for monitoring compliance.
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