On May 17, 2010, a federal jury in a class action suit in Manhattan awarded 12 former female sales representatives a total of $3.4 million in damages for alleged gender discrimination by the pharmaceutical giant Novartis. The jury found that the company had discriminated against the women in terms of pay and promotion, mostly on the basis of pregnancy.
Days later, on May 19, the same jury awarded punitive damages of $250 million to 5,600 of the company's female employees, enabling those women to apply as claimants for individual awards through a special master. The award was the highest ever in an employment discrimination lawsuit.
Novartis is a multinational pharmaceutical company with headquarters in Basel, Switzerland. It had revenue of $41.5 billion in 2009, making it the sixth largest pharmaceutical company in the world. Novartis had been named by Working Mother magazine as one of the top 100 companies for the last 10 years.
The suit was brought by the women, all U.S. employees, who alleged that the company followed a pattern of discrimination against its female sales employees from 2002 through 2007.
The 12 class-action representatives maintained that they had been subjected to a hostile and sexist work environment, particularly in relation to pregnancy, by male district managers. One plaintiff testified that she had been terminated when she was seven months pregnant. Another claimed that a district manager continually showed pornography to female employees and invited them to sit on his lap. She also contended that the company was slow to investigate her allegations. The manager was apparently fired two years after the suit was filed in 2004.
Other testimony included a female employee who stated that she was encouraged to get an abortion, and another who claimed that after she had twins she was repeatedly passed over for promotions in favor of male sales representatives with inferior sales records.
The suit showed that the women in sales positions typically received an average of $105 less per month than their male counterparts during the period from 2002 to 2007. Female employees make up 52 percent of Novartis employees and 44 percent of its managers.
While Novartis has continued to maintain that it has satisfactory relations with its female employees, the suit is undoubtedly an embarrassment to its reputation and should serve as a wake-up call to its senior management to institute sensitivity training and promote better awareness of gender discrimination laws.