March 21, 2011

Bayer Gets $100M Gender Class Action Headache

Pharma Giant Calls Female Managers 'Backstabbing,' 'Indecisive'

Complaint Details Systemic, Pervasive Company-wide Discrimination

NEWARK, N.J., PRNewswire -- Bayer HealthCare Pharmaceuticals was handed a pounding $100 million headache today that even its highly-publicized aspirin is unlikely to relieve. The law firm of Sanford Wittels & Heisler, LLP, filed a class action complaint in U.S. District Court for New Jersey, citing instances of illegal gender discrimination that echo the experiences of female employees at Novartis Pharmaceuticals who successfully won a jury award of more than $250 million last year.

The six Class Representatives Victoria Barghout, Jennifer Christiansen, Barbara Feringa, Jennifer Musumeci, Laura Reilly, and Karen Salomon filed the complaint on behalf of themselves and a class of female employees in the United States under Title VII of the 1964 Civil Rights Act and New Jersey law. The document details a pattern and practice of discrimination in pay, promotions, and the treatment of pregnant women and mothers by the multinational corporation.

The individual plaintiffs and the class are represented by Katherine Kimpel of Sanford Wittels & Heisler, LLP, in Washington, D.C. Ms. Kimpel recently served as Co-lead Counsel in Velez v. Novartis, securing a verdict of more than $253 million, the largest jury award in the U.S. in a gender discrimination case.
"Bayer engages in systemic discrimination against its female employees – particularly those with family responsibilities – by paying them less than their counterparts, denying them promotions into better and higher paying positions, limiting their employment opportunities to lower and less desirable job classifications, and exposing them to different treatment and a hostile work environment," said Ms. Kimpel. "To make matters worse, Bayer is often blatant about its disregard for its female employees."

According to the complaint, Bayer has published and disseminated articles that suggest men are better suited to be managers than women, describing females as prone to "mood swings," "indecision," and "backstabbing;" and concluding that "women with power are 'loose cannons' who often feel threatened by colleagues." The complaint also cites comments by managers disparaging working mothers and declaring that Bayer "needed to stop hiring women of reproductive age."

The plaintiffs assert that senior managers have made negative comments about women discussing or acknowledging child-care responsibilities and have overlooked female employees who availed themselves of federally-protected maternity leave for promotions. As Class Representative Vicky Barghout explained, "My pregnancy should have been a time of joy, laughter and happiness. But I was not able to enjoy that because of Bayer's discrimination against me, and I will never be able to get that experience back. No company has the right to do that. Bayer does not respect the mothers who work for it; instead it rewards hard-working mothers and pregnant women with demotions, pay reductions, and denial of job opportunities. All of this from a company that is supposed to concern itself with women's health."

In response to their complaints of discrimination and retaliation, the Class Representatives were told by Bayer managers they should "know better" and that "the company won't do anything about their complaints." Corroborating this lack of concern, the Bayer's Human Resources Department responded to females' complaints by characterizing gender discrimination as "a grey area" that should be handled by the employee, not the Company.

According to Class Representative Jennifer Musumeci, "We and the other women at Bayer take our careers very seriously, and our income is important to our families. For years, we tried to overcome the prejudice and discrimination at Bayer by proving ourselves to be even better than required. When that didn't work, we went to HR and Senior Management. Human Resources and Senior Management have failed us and Bayer's female employees. It is our hope that through the court, we can make things better for women at the Company."
The Class Representatives have worked or continue to work at Bayer in Associate Director, Deputy Director, and Director positions in the Women's Healthcare and Oncology Divisions. The proposed class includes all female employees of Bayer HealthCare Pharmaceuticals situated in Associate Director positions or higher. Class members seek declaratory and injunctive relief, back pay, front pay and lost benefits, as well as compensatory, nominal and punitive damages in an amount of $100 million or more for themselves and similarly situated female employees.

"The situation at Bayer is a quintessential example of how the glass ceiling and maternal walls are still firmly in place in 2011," said Ms. Kimpel. "The Class Representatives are an incredible group of women, each of whom generated exemplary results that were minimized, overlooked, or otherwise under-recognized by Bayer. Bayer profited off my clients' hard work, but refused to acknowledge that hard work equitably. This lawsuit is about holding Bayer accountable to equal employment opportunity laws."

Bayer HealthCare Pharmaceuticals is a subsidiary of Bayer Corporation, the American arm of Bayer AG, a multinational entity based in Germany. In North America, Bayer Corporation had 2010 net sales of $10.86 billion and employed 16,400 individuals at year-end. Bayer Corporation is incorporated under the laws of Indiana and headquartered in Pittsburgh, PA. Bayer HealthCare Pharmaceuticals is a subsidiary of Bayer Corporation that develops and markets prescription medications, biological products, and biotechnology. It is incorporated under the laws of Delaware and headquartered in Wayne, New Jersey.

BNET; March 22, 2011

6 Execs Allege Bayer’s Policy on Kids Is: “Get a Nanny or Get Out”

Bayer (BAYRY) has been served with a sex discimination class action suit similar to the case that produced a $250 million verdict against Novartis (NVS) last year.
The Bayer case alleges that women can only get to management if they either have no children or if they have nannies, and that one of the chief enforcers of this policy is nanny-favoring women’s healthcare vp Leslie North, whose alleged motto is, don’t “use childcare as an excuse.” The suit claims women can only get ahead at Novartis if they sacrifice their “work-life balance,” and it uses the child-raising status of the company’s own management as evidence against it:
Bayer HealthCare Pharmaceuticals’ Executive Committee, which represents the highest level of management attainable within the Company, exemplifies this disparity: only three of approximately eleven permanent committee members are women.
The few women who have advanced beyond the director level and into the highest echelon of management have achieved this rank by sacrificing their personal lives and abandoning work-life balance. Female Vice President of Global Health Economics and Outcomes Research Kathleen Gondek is unmarried with no children, female Senior Director Susan Herster has no children, and female Vice Presidents Shannon Campbell and Leslie North have others who serve as primary care-givers for their children.
North is singled out in the suit: Defendant North has a reputation within the Company for preferring employees without primary childcare responsibilities. She has stated on multiple occasions her belief that children should be raised by nannies and that having a nanny is the solution to work being first. She has also selected less-qualified employees in her hiring decisions rather than more-qualified employees with primary childcare responsibilities.
Because management executives at Bayer have to travel a lot, “Leslie North frequently warns employees not to ‘use childcare as an excuse’,” the suit claims.
The claims in the Bayer case are less dramatic than those in the Novartis litigation. At Novartis, HR threatened to fire a sales rep who was raped by a customer and women alleged they were fired if they got pregnant.) At Bayer, the six plaintiffs claim they were paid less, ridiculed or denied promotions, often because they got pregnant or took family leave they were entitled to by law. Bayer says the case only tells one side of the story:
Bayer denies the allegations of gender discrimination and will vigorously defend itself against these charges. Bayer will not comment further on pending litigation, other than to note that it is committed strongly to a policy of non-discrimination and equal treatment for all employees.
The case raises one of the thorniest issues in HR: how to handle key executives who leave work to have children. The law bans discrimination against the pregnant worker, but everyone knows that a birth will at least lead to an absence from work of several weeks or months and that there is a good chance the employee will choose not to come back at all. The new mom’s colleagues are left with a choice: Plow on under the assumption that she will return or plan for the eventuality that she won’t.
The situation is compounded when it comes time for promotions: Does management reward the employee who never left the office or the parent whose work history now includes a lengthy absence? It’s an unattractive dilemma: Reward the parent and you’re sending a frustrating message to those who didn’t take leave. Don’t reward the parent and you may be breaking the law.
The solution is probably for management to realize that businesses don’t generally fall apart if a single employee takes leave or cannot occasionally travel. If that seems to be the case at your firm, then this should be taken as a sign of your own bad management — you’re too dependent on that employee and need to come up with a more sensible way of working. By Jim Edwards

Will “Donut” Incident in Sex-Harassment Suit Finally Get Bayer’s Attention?

By Jim Edwards | May 26, 2011, BNet

The class action sex discrimination case against Bayer (BAYRY) was once a rather boring affair, filled with dry stuff about disparate pay rates and missed promotions for women with perfect work records. Yesterday it was updated with the kind of narrative sizzle that juries pay attention to: Specifically, what will likely come to be known as the “donut-in-the-elevator” incident, among other gossipy tidbits.

Legally, the claim has a potentially high liability for Bayer because of its boring bits: A similar case against Novartis (NVS) resulted in a $250 million verdict against the company. Novartis lost that case because it went to a jury even though one of the plaintiffs claimed Novartis threatened to fire her after she was raped by one of her customers. The Bayer case now has that kind of drama inside it. Whether Bayer’s management, based thousands of miles away in Leverkusen, Germany, fully grasps this is an open question.

Vera Santangelo, a financial specialist in Bayer’s consumer care unit claims she was cornered in an elevator while eating a donut by a repeat harasser:
During the elevator ride, Ms. Santangelo could see Defendant Scott eyeing her body and the oblong-shaped donut in her hand. When the elevator reached her floor, she told Defendant Scott to have a nice day. At that point, he grabbed her arm and whispered, “Not as nice of a day as if I could watch that whole donut slide down your throat.”

Why don’t you just stop taking the elevator?
None of this will be news to Bayer, as Santangelo reported the incident to the company’s hotline, its ombudsman, the HR department, the vice president and assistant general counsel, and the former and the current presidents of Bayer’s consumer care unit. None of them did anything about it, she alleges:
For example, when she explained to Manager Brachfeld that being in an elevator with Defendant Scott made her uncomfortable, he replied, “Why don’t you just stop taking the elevator?”
The Bayer hotline — for employees to make anonymous complaints about management — was not particularly hot, according to the suit. When you call it, all that happens is that the voice on the other end asks you to call back in two weeks, Santangelo claims.

In October 2010, months after the $250 million Novartis case made headlines, Bayer published an “Executive News Summary,” the suit claims:
… the Executive Committee distributed an article that suggested the superiority of men for management roles. Labeling women “the fairer sex,” the article described women as prone to “mood swings,” “indecision,” and “backstabbing.”
The article stated that a majority of men and women polled prefer to work for a male manager because men are “easier to deal with” and “much less likely to have a hidden agenda, suffer mood swings or get involved in office politics.”
The article concluded that “women with power are ‘loose canons’ who often feel threatened by colleagues.”

And then there’s this weird claim, which has nothing to do wth gender discrimination but is likely to resonate with an American jury:
… in early 2009, Defendant Oelrich called Ms. Karen Salomon Bayer's associate director of market intelligence into his office and questioned her at length regarding her Jewish heritage and religion. During that meeting, he asked Ms. Salomon, “Why would a Jew like you work for a German company?” Ignoring her confusion and discomfort, he continued by needling her about how her Jewish family felt about her decision to work at Bayer. During this conversation, which lasted approximately 30 minutes, he asked Ms. Salomon to “explain herself.”

Does the head know what the body is doing?

Bayer denies the claims:
As before, Bayer denies the allegations of gender discrimination and will vigorously defend itself against these claims. Bayer will not comment further on pending litigation, other than to repeat that it is committed strongly to a policy of non-discrimination and equal treatment for all employees.”
The suit hints that part of the problem lies in Bayer’s management structure. The company was originally German and the corporate HQ remains in Germany even though the largest portion of its business is in the U.S. That separation may have allowed problems in the U.S. to seem distant to the company’s senior executives, even though on a revenue basis Bayer is now an American company that has some offices in Germany.
In Europe, liabilities in employment cases tend to be small, with awards coming in at under €1 million. It’s not clear that Bayer understands that in the U.S. cases now stretch into the hundreds of millions of dollars.