Merrill Lynch & Co., the nation's largest brokerage house, agreed yesterday to settle a multimillion-dollar sex discrimination case filed more than a year ago.
In so doing, the company swept aside decades-old securities industry rules that send disputes involving brokers to industry-run arbitration panels. Though it was designed to address disagreements between brokers and customers, by extension, the practice barred brokerage employees from taking such complaints as job discrimination or sexual harassment to federal court.
Yesterday's announcement came six months after another major name on Wall Street, Smith Barney, agreed to settle charges that its female employees had been regularly subjected to discrimination and harassment.
The Merrill Lynch case was filed in U.S. District Court in Chicago in February 1997. Plaintiffs were eight women, including one who worked in the firm's Northbrook, Ill., office, and another from Indianapolis.
They charged that the firm systematically denied them the same resources -- from training to support personnel -- given male brokers. They also charged that the company eliminated or downgraded jobs while women were on maternity leave. In the settlement, the eight women will split $600,000.
Merrill consistently denied the charges, and a proposed settlement collapsed in January.
The agreement creates a process that allows the 2,500 women employed at Merrill Lynch since Jan. 1, 1994, to pursue mediation before a nonindustry arbitrator if they have complaints. If mediation is unsuccessful, the women can seek a hearing, which can be public if they wish, to seek compensation. The company will establish a settlement fund for any successful claims.
Significantly, the agreement also allows Merrill Lynch employees the right in future employment disputes to go through an in-house procedure or to sue the company in federal district court.
Pub Date: 5/05/98