Johnson & Johnson allegedly discriminated against black and Hispanic managers and other salaried employees.
Earlier this month, a lawsuit seeking class action status has been filed in the United States District Court with the plaintiffs claiming pay discrimination against Hispanic employees, and both pay and promotion bias against blacks.
For one, the plaintiffs claimed in court papers that the 'discriminated’ workers' starting salaries were 3.75 percent lower than those of white non-Hispanics of comparable experience and education. Minority managers made between 5.2 percent and 8.39 percent less pay than comparable whites from 1997 to 2003, it added.
Moreover, black workers allegedly received as least 12.4 percent fewer promotions from 1997 through 2003 than they should have. The complaint also stated that the company often didn't post openings and used a "tap on the shoulder" style to determine promotions, which discriminated against black managers. White managers selected other whites for promotion, while blacks weren't given the opportunity to apply for management jobs.
If U.S. District Judge William Walls in Newark certifies the class, the case could cost Johnson & Johnson tens of millions of dollars to settle. The class could involve as many as 8,600 current and former employees throughout the U.S. Workers are seeking as much as 5 percent of their salary for each class member per year, starting in 1997. In addition, the workers are asking for future pay, punitive damages and changes in the company's policies.
And J&J should be feeling the jitters because the plaintiffs' attorney Cyrus Mehri won the record fourth-and fifth-largest race-bias lawsuits to date, according to data complied by Bloomberg: $192.5 million settlement from Coca-Cola Co. in 2001 and $176 million payout from Texaco Inc. in 1997.
Johnson & Johnson denied that it discriminated and argued in court papers that the workers shouldn’t be allowed to proceed as a group because personnel decisions come from more than 30 individual U.S. subsidiaries, not company headquarters in New Brunswick, New Jersey. It added that workers can’t show a common employment policy or practice that is the source of discrimination at the subsidiaries.