Microsoft has agreed to a $14 million settlement with California’s Civil Rights Department to resolve allegations that it unlawfully penalized employees who took medical or family-care leave, the agency announced on Wednesday.
According to filings in state court, the California agency accused the tech giant of retaliating against its California-based employees who utilized parental, disability, pregnancy, and family-care leave since 2017. Allegations included denying them raises, promotions, and stock awards, disproportionately affecting women and individuals with disabilities. The department asserted that lower performance-review scores diminished pay, hindered promotion opportunities, and altered career trajectories for affected workers.
The settlement, subject to approval by a state judge, marks the conclusion of a multiyear investigation by the Civil Rights Department. Microsoft, while denying wrongdoing in the settlement agreement, expressed disagreement with the agency’s claims.
“Microsoft is committed to an environment that empowers our employees to take leave when needed and provides the flexibility and support necessary for them to thrive professionally and personally,” a company spokesperson stated.
California’s Civil Rights Department has secured significant settlements in recent years, predominantly in cases of sex discrimination. Previous agreements include a $100 million settlement with Riot Games in 2021, a $54 million settlement with Activision Blizzard last year, and a $15 million settlement with Snapchat parent Snap (SNAP.N) announced last month.
The agency’s accusations against Microsoft encompassed allegations of sex and disability discrimination, as well as interference with workers’ rights to take leave. The exact number of workers who will benefit from the settlement remains unspecified. Microsoft, headquartered in Redmond, Washington, employs approximately 6,700 individuals in California, as per court filings.
Kevin Kish, director of the Civil Rights Department, criticized Microsoft for failing to support workers requiring time to care for themselves and their families. “The settlement announced today will provide direct relief to impacted workers and safeguard against future discrimination at the company,” Kish affirmed.
In addition to the $14.4 million payout, Microsoft has agreed to engage an independent consultant to review company policies to ensure non-discrimination against leave-taking employees. The company will also conduct training for managers and human-resources personnel to facilitate complaint resolution.
