More Than Money: Qualcomm Promises Change to Settle Gender Pay Class Action

By: Laura Reathaford

October 13, 2016

In early 2015, seven female employees of Qualcomm brought a gender discrimination class and collective action lawsuit on behalf of themselves and roughly 3,300 other female employees. They alleged Qualcomm violated Title VII and the Equal Pay Act, as well as related state laws, by affording them lower pay, opportunities, and benefits compared to their male counterparts.

The plaintiffs were employed by Qualcomm in science, technology, engineering, and math (STEM) and related roles. They alleged that female employees received lower base salaries than males in similar roles. They further alleged that Qualcomm’s organization-wide promotion policies—which allowed largely male managers to subjectively select individuals for advancement and to exclude women from the training and networking opportunities linked to promotion—resulted in either denying women promotions altogether or promoting them more slowly than equally qualified, or even less-qualified, male employees. According to the plaintiffs, this promotion system purportedly led to clear disparities between men and women in senior leadership roles in the organization.

In addition, the plaintiffs alleged that Qualcomm maintained a policy whereby managers interfered with the statutorily protected leave and flexible schedules afforded to female caregivers. It allegedly did so by fostering a work environment focused on 24-7 availability and rewarding employees who were able to work late into the evening, while prorating the pay of and assigning subpar bonus ratings to female caregivers, regardless of the quality or quantity of the work that they performed.

The parties have agreed to settle the case for $19.5 million and estimate that this will result in an average pre-tax recovery of nearly $4,000 for each class member. A hearing for preliminary approval of the settlement is currently set for December 1, 2016 in the Southern District of California.

More importantly, Qualcomm has agreed to include a “programmatic relief package” in the settlement agreement. Qualcomm will retain independent consultants to implement reforms and secure an equitable workplace for female employees. It will also create initiatives to promote and compensate women equitably, including programs for women geared toward the development of leadership skills. Finally, Qualcomm will revise its policies relating to flexible work schedules and caregiver leave. The parties anticipate that this relief package represents an additional $4 million benefit to the members of the class.

Equal Pay Act claims are on the rise and are not limited to STEM job classifications.  Accordingly, employers would be wise to take steps to mitigate potential gender discrimination liability. Identifying and conducting audits of job classifications that might be gender heavy is a good start. Reviewing and updating discrimination policies to ensure they account for pay inequity is another positive step. Finally, employers should train decision makers on how to properly determine pay and promotions, including updating or creating salary range guidelines that decision makers can use and which can be uniformly applied.