Goldman Sachs Faces Class Action Suit Over Alleged Gender Discrimination

Goldman Sachs Faces Class Action Suit Over Alleged Gender Discrimination

Goldman Sachs has joined the ranks of high-profile employers hit with major litigation over allegations of gender bias in pay, promotions, and performance reviews. On Friday, a federal judge in New York certified the eight-year-old case as a class action lawsuit, ruling that women who believed the investment bank had discriminated against them on the basis of their gender could pursue their claims as a group, Reuters reported.

US District Judge Analisa Torres ruled that employees and former employees could participate in the suit if they had worked as associates or vice presidents in Goldman’s investment banking, investment management, and securities divisions since September 2004, or since July 2002 for employees in New York City. Plaintiffs’ attorney Kelly Dermody told Reuters that the certified class encompassed an estimated 2,000 people.

This lawsuit is one of several brought against major financial firms over the past decade alleging gender discrimination in this male-dominated sector, where women make up about half the workforce but only a quarter of senior-level positions. Gender pay data from the UK shows that the world’s leading banks have substantial gender pay gaps, owing to the much lower representation of women in senior roles with higher earning and bonus potential—a deliberate imbalance, the litigants in these suits claim. A study last year also found that women in finance are routinely punished more harshly than their male colleagues for misconduct, even when that misconduct is less costly and less likely to be repeated.

Goldman’s own UK gender pay gap data revealed a mean gender pay gap of 55.5 percent at its international business, with a bonus gap for that unit of 72.2 percent. Within that unit, 83 percent of those earning the highest hourly pay were men, while 62.4 percent of those earning the lowest hourly pay were women. Goldman Sachs UK, a smaller unit that employs people in non-revenue positions, reported smaller mean gaps of 16.1 percent in hourly pay and 32.5 percent in bonus pay.

Shortly before these figures were revealed, Chief Executive Officer Lloyd Blankfein and President David Solomon issued a memo to employees saying women and men at the bank were paid equally for equal work, but acknowledged that women were underrepresented in the upper echelons of the company. Blankfein and Solomon expressed a commitment to achieving a 50/50 gender split in each class of fresh graduates Goldman hires by 2021, with a long-term goal of having an equal number of male and female employees (Women made up 38 percent of the Goldman Sachs workforce in 2016).

Finance is not the only high-earning, high-profile industry where gender discrimination is allegedly rampant: Silicon Valley tech companies, including Google and Microsoft, have also faced accusations of systemic discrimination and cultures that enable harassment.