LinkedIn Corp., the online professional-networking platform, has agreed to pay $1.8 million to nearly 700 female workers in California after the Department of Labor (DOL) alleged that these workers were subjected to "systemic, gender-based pay discrimination."
According to a DOL statement, LinkedIn, which is owned by Microsoft, paid women working in engineering and marketing jobs in San Francisco and in engineering and product jobs at the firm's Sunnyvale, Calif., headquarters less than their male colleagues. In doing so, LinkedIn failed to comply with a long-standing executive order barring discrimination in employment by government contractors and subcontractors.
The DOL's Office of Federal Contract Compliance Programs (OFCCP) concluded that LinkedIn had failed to comply with Executive Order 11246 and its implementing regulations during the review period—March 1, 2015 through March 1, 2017. LinkedIn, while entering into a conciliation agreement with the DOL, denied the government's claims.
SHRM Online has gathered the following articles and resources looking at LinkedIn's settlement and gender-based pay discrimination.
Settlement Terms Reached
"Our agreement with LinkedIn Corp. resolves alleged pay discrimination that denied 686 female workers … their full wages," explained OFCCP Regional Director Jane Suhr in San Francisco. "In addition to recovering $1.8 million in back wages and interest for these workers, our agreement will ensure that LinkedIn better understands its obligations as a federal contractor and complies in the future."
Under the terms of the agreement, LinkedIn will:
- Pay $1.8 million in back wages and interest to the affected workers.
- Conduct a staff training program to ensure compliance with LinkedIn's non-discrimination obligations.
- Evaluate, for the next three years, whether the company's compensation is gender-neutral and make salary adjustments if not. LinkedIn will also revise its compensation policies and practices and agreed to monitoring and reporting to ensure compliance with federal contract obligations.
(U.S. Department of Labor)
LinkedIn Denies Violations
In a statement released May 2, LinkedIn denied that it discriminated against female employees.
"While we have agreed to settle this matter, we do not agree with the government's claim," the statement said. "LinkedIn pays and has paid its employees fairly and equitably when comparing similar work. In 2021 we conducted an 'equal pay analysis' and found that globally, for every $1 earned by men, our female employees earn $0.999. In the U.S., our employees of color earn $1 for every $1 earned by our white employees."
The statement added, "We recognize that pay equity requires continuous attention and investment."
Investigators Scrutinized Pay Data and Policies
The DOL's findings emerged from a routine evaluation by the OFCCP looking into LinkedIn's compensation policies and practices. The findings were based on sources including employment policies, records and compensation data for individual employees, as well as interviews with managerial, nonmanagerial and HR employees.
Other Tech Company Settlements
Tech companies have faced particular scrutiny over what critics say are failures to provide equal opportunities to women and people of color.
In February 2021, Google reached a $3.8 million settlement with the DOL amid accusations that it made hiring and compensation decisions that discriminated against female and Asian employees and applicants.
Under an agreement with state authorities in Rhode Island, Pinterest, an image-sharing and social media service, pledged $50 million in November 2021 to make reforms, in order to resolve allegations that it discriminated against women and people of color.
(The New York Times)
Agencies Promote Pay Equity at Federal Contractors
The OFCCP issued a new directive clarifying federal contractors' annual obligation to analyze their compensation practices. "Conducting these pay equity audits helps address and prevent pay disparities based on gender, race or ethnicity," the White House said.
In addition, the Office of Personnel Management anticipates issuing a proposed regulation that will bar the use of prior salary history in the hiring and pay-setting processes for federal employees, consistent with actions taken by many U.S. states and localities. "Banning the use of prior salary history can help break the cycle of past arbitrary and potentially discriminatory pay that can follow women and workers of color from job to job, entrenching gender and racial pay gaps over time," the White House said.