Gender Pay Gap Lawsuit Could Cost Disney Over $300 Million

Shannen Ace

Gender Pay Gap Lawsuit Could Cost Disney Over $300 Million

A gender discrimination lawsuit first filed against The Walt Disney Company in 2019 could move forward as a class-action lawsuit and cost the company over $300 million.

Sleeping Beauty Castle at Disneyland

The suit was filed in 2019 in Los Angeles County Superior Court by law firm Andrus Anderson LLP on behalf of Cast Members LaRonda Rasmussen and Karen Moore. The law firm’s pay gap attorney, Lori E. Andrus, said in a statement at the time:

“As Disney nears its 100th year in existence, it needs to catch up with the times. The gender pay gap addressed by this lawsuit is all too familiar, and women are fed up with being treated as cheap labor. We hope that this lawsuit will shed some light on the pay discrimination that Disney is subjecting its hard-working female employees to. It is only fair to demand equal pay for equal work.”

The suit has been delayed due to COVID-19, a judge’s retirement, and other factors. But the two women and their attorneys (including Andrus, Joseph M. Sellers, and Christine E. Webber of Cohen Milstein Sellers & Toll) are now asking California Judge Elihu M. Berle to turn the lawsuit into a class-action suit, Deadline reports.

Here is a section of the filing (which Deadline shared in full here):

Disney systematically pays women in California less than men. This pay disparity is not based on legitimate factors, it is based on sex, with a less than one in one billion chance it occurred in the absence of discrimination. The class as a whole was thus deprived of over $150 million in wages. Disney violated the Fair Employment & Housing Act (“FEHA”) because its common practices caused a disparate impact on women. It also violated California’s Equal Pay Act (“EPA”), which does not require Plaintiffs to identify the cause of the disparities, because it pays women less for substantially similar jobs. Accordingly, Plaintiffs seek certification of a class of non-union, female employees in California, below the level of Vice President, challenging sex discrimination in compensation at Disney on or after April 1, 2015.

Only as a class can the women at Disney address wage gaps and receive effective injunctive and monetary remedies. Injunctive relief to address systematic disparities is unattainable through individual actions as the scope of relief would be limited to the scope of the violation shown, and an individual plaintiff would not obtain the breadth of discovery of a class. And many class members are unlikely to bring individual actions.

The filing also calls out Disney CEO Bob Iger directly:

In addition to controlling Disney’s organization into segments, the CEO exercises direct control over many aspects of employment, including by directing the return to in-person work, establishing a hiring freeze, imposing travel restrictions, and, most recently, requiring layoffs.

Much of the filing is redacted because of the inclusion of corporate documents.

Andrus told Deadline, “We are pleased to be taking the next step in this important litigation. As our experts explain, women who work for Disney face a persistent gender wage gap. Over the last eight years, that has added up to more than $150 million in stolen wages.”

If Judge Berle classifies the suit as a class action at the proposed November 15 hearing, and if the plaintiffs win their case, Disney could be forced to pay $300 million (double the $150 million) under the state’s Equal Pay Act. The judge could add more damages and sanctions on top of that, as well.

Of course, Disney disagrees about the pay gap. Shawna M. Swanson, Associate General Counsel and head of Disney’s employment law function, said, “The plaintiffs’ assertions about an alleged pay gap between women and men are simply false, which we will demonstrate through the litigation.”

Disney previously tried to have the lawsuit dismissed by claiming the apparent discrepancies noticed by Rasmussen and Moore were “an assortment of individual claims, based on highly individualized allegations.”

A 2017 pay-equity study conducted by Disney has been allowed into the case an shows the average wage discrepancy is 2.5% less pay for women than men since 2017.

“There are 12,511 women employed at Disney in Covered Positions in the Class Period, for an average of 4.38 years,” economics professor David Neumark from the University of California, Irvine said in a report. “Thus, the estimated pay penalty implies cumulative underpayment of covered women in the Class Period of approximately $151.6 million.” Neumark did not analyze “bonuses and long-term incentive pay.”

The class action filing does not include employees of Hulu, ESPN, 21st Century, FX, Pixar, National Geographic, or Bamtech.

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Author

  • Shannen Michaelsen

    Shannen has been a Disney Parks fan and lover of dogs since childhood, despite Pluto's attempt to eat Shannen's Minnie Mouse doll the first time they met. They've made up now. You can email Shannen at shannen@wdwnt.com.