Last week, the pharmaceutical industry struck a blow against sexism. In May, a US District Court found Novartis (Basel) guilty of gender discrimination. Novartis and the law firm that represented a class of 5600 female employees reached a settlement agreement that became public last Wednesday. The terms of the agreement seem to indicate that the company is making a legitimate effort to treat its employees fairly.
First, Novartis agreed to pay as much as $152.5 million to eligible class members, including current and former sales representatives and entry-level managers. The plaintiffs apparently are satisfied with the settlement, which allows “full compensation” for the women, thus “ensuring that every woman who worked at Novartis over the past eight years has been compensated fairly,” according to David Sanford, the plaintiffs’ lead lawyer, in a press statement.
Even better, Novartis agreed to spend $22.5 million on programs designed to ensure fair treatment of all members of the company’s sales force. For example, Novartis will revise its sexual-harassment policy and training to stress that it will not tolerate inappropriate behavior or comments. The company also will work to ensure that employees can raise concerns safely and that the complaints are addressed promptly. Novartis also will revise its performance-management process, which could help prevent raises and promotions from being withheld on the basis of sex.
Perhaps the most important part of the agreement is the company’s pledge to retain an external specialist who will identify and remedy, with recommendations from the plantiffs’ lawyers, unjustified gender disparities. If the specialist is sufficiently motivated and perceptive, his work could go a long way toward closing the gender gap that apparently exists at the company. This arrangement could be a model for the pharmaceutical industry, which, like other industries, still suffers from discrepancies in pay and opportunity that fall along gender lines.
I suggest that Novartis’s new specialist investigate whether women are equally represented in the company’s management positions. It still seems to me that too few women are promoted to these types of jobs, and companies would reap various benefits from having more women managers.
The settlement between Novartis and the plaintiffs promises to help reduce gender inequality at the company. The outside specialist’s oversight in particular gives me hope that Novartis will be held to account if its policies result in discrimination. The pharmaceutical industry as a whole should take note of this settlement and remember the still unresolved problem of gender-based inequality.