Activision Blizzard to pay $54M to settle gender discrimination lawsuit, agrees to ensure ‘fair pay and promotion practices

Activision Blizzard to pay $54M to settle gender discrimination lawsuit, agrees to ensure ‘fair pay and promotion practices

Activision Blizzard, the video game maker behind popular titles like Call of Duty and Overwatch, has reached a settlement agreement to pay $54 million in a gender discrimination lawsuit. The settlement resolves allegations that the company discriminated against women by denying them promotion opportunities and paying them less than their male counterparts for similar work. The lawsuit, brought by California’s civil rights agency, also claimed that female employees faced constant sexual harassment and were underrepresented in leadership positions. This settlement comes after Activision Blizzard settled similar harassment and discrimination claims in the past, signaling a commitment to address these issues and ensure fair pay and promotion practices within the company.

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Activision Blizzard settles gender discrimination lawsuit

Settlement amount

Activision Blizzard, the video game maker behind popular games like Call of Duty and Overwatch, has agreed to pay approximately $54 million to settle a gender discrimination lawsuit. The settlement amount, which is subject to court approval, will be used to compensate women who were allegedly denied promotion opportunities and paid less than their male counterparts for similar work.

Subject to court approval

The settlement agreement reached by Activision Blizzard and the California Civil Rights Department is still subject to approval by the court. Once approved, the settlement will provide financial compensation to eligible women who worked for the company between October 2015 and December 2020.

Allegations of discrimination

The gender discrimination lawsuit against Activision Blizzard alleged that the company created a hostile work environment for women by denying them equal opportunities for advancement and paying them less than men for similar work. These allegations, if proven, would constitute illegal workplace discrimination.

Impact on stock price

The allegations of discrimination and the subsequent lawsuit had a significant impact on Activision Blizzard’s stock price in 2021. The negative publicity surrounding the case raised concerns among investors and contributed to a drop in share prices. The settlement of the lawsuit may help restore investor confidence and stabilize the company’s stock price.

Microsoft takeover bid

The negative publicity surrounding the gender discrimination lawsuit also played a role in Microsoft’s takeover bid for Activision Blizzard. In January 2022, Microsoft announced its $69 billion deal to acquire the video game maker. The settlement of the lawsuit may help address some of the concerns raised by antitrust regulators and rivals, paving the way for the completion of the acquisition.

Allegations of sexual harassment

In addition to the gender discrimination claims, Activision Blizzard also faced allegations of sexual harassment. Female employees at the company claimed that they were subjected to constant harassment and that few women were appointed to leadership positions. These allegations added to the negative perception of the company and further damaged its reputation.

Petitions and walkout

Employees at Activision Blizzard expressed their concerns over the company’s handling of the discrimination allegations through petitions and a walkout. They criticized the company for its defensive reaction to the lawsuit and demanded an end to the hostile work environment. The public pressure from employees and the gaming community likely contributed to the company’s decision to settle the lawsuit.

Compensation for eligible women

Under the terms of the settlement, women who worked for Activision Blizzard between October 2015 and December 2020 may be eligible for financial compensation. A portion of the $54 million settlement amount, around $45.75 million, has been set aside for these payouts. This compensation aims to address the alleged pay disparities and promotion denials experienced by women at the company during the specified period.

Commitment to fair pay and promotion

In addition to the financial settlement, Activision Blizzard has also committed to implementing fair pay and promotion practices. The company acknowledges the importance of these issues and pledges to fully comply with the new obligations outlined in the settlement agreement. By taking these steps, Activision Blizzard aims to create a more inclusive and equitable work environment for its employees.

Amended complaint withdraws sexual harassment allegations

As part of the settlement agreement, the California Civil Rights Department agreed to file an amended complaint that withdraws the sexual harassment allegations against Activision Blizzard. The settlement reflects the company’s position that no independent investigation or court has substantiated these claims of systemic harassment or improper actions by the board of directors and CEO.

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Previous settlements and charges against Activision Blizzard

Settlement with U.S. Equal Employment Opportunity Commission

Prior to the gender discrimination lawsuit, Activision Blizzard settled sexual harassment and discrimination claims brought by the U.S. Equal Employment Opportunity Commission (EEOC). The company agreed to establish an $18 million fund to compensate individuals who experienced harassment or discrimination. This settlement aimed to address the previous allegations and improve the company’s workplace culture.

SEC charges and settlement

Activision Blizzard also faced charges from the Securities and Exchange Commission (SEC) regarding its workplace complaint handling and whistleblower protection practices. The company agreed to pay a $35 million settlement to resolve these charges. The settlement included the implementation of measures to improve the collection and assessment of workplace complaints, ensuring compliance with disclosure requirements and protecting whistleblowers.

Summary

Activision Blizzard’s settlement of the gender discrimination lawsuit highlights the company’s commitment to addressing the allegations of workplace discrimination and harassment. The financial settlement aims to compensate eligible women for pay disparities and denied promotion opportunities. Additionally, the company has pledged to establish fair pay and promotion practices to create a more equitable work environment. By settling previous lawsuits and charges, Activision Blizzard is taking steps to rebuild its reputation and improve its workplace culture. The settlement amount and the company’s actions will be subject to court approval, ensuring that the resolution aligns with legal obligations.

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