Oracle Female Employees' 7-Year Gender-Pay Equity Battle, Only Nets $25 Million in Court Settlement

Female employees of Oracle Corporation fought the company in court for nearly seven years regarding gender-pay equity, only to reach a $25 million settlement, which, when compared to the software giant's size, is relatively small, equivalent to just one or two paychecks for most of the women involved.

A proposed agreement was filed this week that needs court approval to end a conflict that started in June 2017, alleging tech giants are paying women less than men for the same work systematically.

Gender-pay Discrimination Lawsuit From 4,000 Employees

The discrimination case against Oracle made history by becoming the first in the industry to be granted class-action status, a milestone never reached in similar cases against Microsoft and Twitter, and was taken away from the employees in 2022 by a California state judge.

In the agreement with Oracle America Inc., once attorney fees are settled and a portion goes to the state Labor Department, around $15 million will be split among roughly 4,000 employees, including women who worked in product development, support, and I.T. departments in California from June 2013 onward.

Oracle did not respond right away to a comment request. In the proposed settlement, despite its market capitalization of about $314 billion, the company maintains its denial of the allegations.

This case highlights the challenges women in the tech industry encounter when seeking equal pay through legal channels. Class-action status is vital because it enables plaintiffs to combine resources and seek larger settlements. However, it has become harder to achieve since a significant ruling by the U.S. Supreme Court in 2011 raised the bar for large-scale employment discrimination cases.

Google's Similar Claim Settlement in 2022

The lawyers who worked on the Oracle case also settled comparable claims against Google in 2022 for $118 million for a group of 15,500 women who had previously obtained class-action status in the preceding year.

The average payouts per person in the Oracle and Google cases were $3,750 and $5,500, respectively, after covering legal expenses, which are significantly lower compared to the approximately $50,000 each received by around 2,800 women at Goldman Sachs as part of a $215 million pay equity settlement with the Wall Street titan last year.

Oracle's Unsuccessful 2017 Case

Another aspect to consider regarding the Oracle settlement is the U.S. Labor Department's unsuccessful 2017 case against the company, where the government sought $400 million in back pay for women and minorities. Still, an agency judge concluded that the company did not intentionally engage in pay discrimination after a trial.

To be certain, the Oracle agreement goes beyond just a monetary settlement. According to the deal, an independent expert would examine the relevant positions and provide suggestions to the company to ensure its policies align with equal-pay regulations.

A Positive Settlement's Outcome

Attorneys for the plaintiffs, James Finberg and John Mullen, stated that the work they put in over seven years was worth more than the $8.3 million but stressed that they did not want to reduce the payout for their clients any further. Each woman's actual payout in the settlement would vary depending on how much overall compensation they collected during their time at Oracle.

In a court filing on Tuesday seeking approval for the settlement, the lawyers praised it as a positive outcome considering the challenges of reinstating class status on appeal, proceeding to trial, and the potential delays in receiving payouts even if they were to win due to company appeals.

The filing highlighted San Mateo County Superior Judge Raymond Swope's decision two years ago to overturn his groundbreaking ruling from 2020, which had granted class-action status to the three Oracle women who filed the original complaint.

Upon reconsideration, Swope sided with Oracle, concurring that proceeding to trial with a class of over 3,000 employees across 125 different job classifications would be unmanageable.

The company contended that the lawsuit made an inaccurate comparison between women and men with the same job codes, even though such coding doesn't necessarily imply that the work demands similar skills, effort, or responsibility, given Oracle's extensive range of products and services.

Now Amazon is under scrutiny for gender-pay disparity allegations. In November, the retailer faced a proposed class action lawsuit, alleging it pays women less than male employees in similar roles. Amazon has refuted these allegations. This month, the three women who initiated the lawsuit claimed that Amazon retaliated against them.