Microsoft to pay $14m settlement regarding allegations of penalizing employees who took leave

A California agency has announced that Microsoft Corp has reached a settlement to pay $14 million to resolve allegations of unlawfully penalizing employees who took medical or family-care leave.

The tech giant is being accused by the California Civil Rights Department of retaliating against its California-based employees who took parental, disability, pregnancy, and family-care leave since 2017. They allegedly denied these employees raises, promotions, and stock awards.

According to the department, the affected workers, who were largely women and people with disabilities, were given lower performance-review scores, leading to reduced pay and limited opportunities for promotions, thus impacting their career paths.

The settlement, subject to approval by a state judge, would bring an end to the Civil Rights Department's lengthy investigation, as stated by the agency. Microsoft, however, denied any wrongdoing in the settlement agreement and expressed disagreement with the agency's accusations in a statement released by a company spokesperson.

“Microsoft is committed to an environment that empowers our employees to take leave when needed and provides the flexibility and support necessary for them to thrive professionally and personally," the spokesperson justified.

In recent years, the Civil Rights Department of the state has revealed several significant settlements, particularly in cases involving sex discrimination. These settlements comprise a $100 million agreement with Riot Games, a video game developer, in 2021, a $54 million resolution with Activision Blizzard last year, and, just last month, a $15 million settlement with the parent company of Snapchat, Snap.

Microsoft was accused by the agency of engaging in sex and disability discrimination and also of interfering with workers' rights to take leave. The number of workers who could benefit from the settlement was not made clear. According to court filings, Microsoft, based in Redmond, Washington, has around 6,700 employees in California.

According to a statement by Kevin Kish, the director of the Civil Rights Department, Microsoft failed to provide support to workers when they needed time off to take care of themselves and their families. Kish stated that the settlement announced today will give direct relief to affected workers and will also protect against future discrimination within the company.

In addition to the $14.4 million settlement, Microsoft has committed to engaging an external consultant to oversee compliance with non-discriminatory policies for employees on leave, facilitating avenues for lodging complaints, and conducting training for managers and human-resources staff.