Posted May 20th, 2010.
The Basel-based pharmaceutical company Novartis has been fined $250 million (SFr289 million) in punitive damages after a New York jury found it guilty of practicing sex discrimination.
The damages are to be divided between about 5,600 women employees of the Novartis Pharmaceuticals Corporation, a United States affiliate of the Novartis group, covered by the 2004 class action lawsuit.
He said the award – which he believed was the largest ever from a jury in a gender-discrimination case – was meant to punish the company for its past actions and to deter it and others from continuing to discriminate against female employees in the future.
Sanford said the judge will also be asked to order “sweeping changes” to the company’s pay and promotion system, its pregnancy policy, its system of performance reviews and its human resources department.
The judge hearing the case had instructed jurors to consider their award in light of the “offensiveness of Novartis’ behavior, the nature and extent of the harm done, the length of time the class endured the behavior, the extent to which Novartis knew about the discrimination and how they reacted once they were on notice.”
The judge also said the amount should reflect Novartis’ financial condition in order to act as a deterrent.
Sanford had asked for $285 million, on the basis that the company should pay two to three per cent of its $9.5 billion revenue for 2009.
“Victory for working mothers”
“I feel like it’s a huge victory for working mothers in all industries,” said Holly Waters, one of the 12 plaintiffs in the case, after Wednesday’s verdict.
“I am so excited that this day has finally come,” Waters told swissinfo.ch.
During the trial, Waters, characterised by lawyers as a high-performing employee, testified she was threatened by her manager that she would be fired if she took another sick day due to morning sickness during pregnancy. After giving birth and before taking paid maternity leave, she was fired.
Several of the witnesses brought by Novartis claimed that the company had “zero tolerance” for discrimination.
But they also admitted that managers who were found to have breached the guidelines had not had their contracts terminated, or even been demoted.
Novartis lawyer Richard Schnadig urged the jury not to react emotionally. “The company is taking everything you said to heart and is going to change. Be fair to us,” he urged.
The jury had found on Monday after a six-week trial that Novartis discriminated against women workers after hearing evidence of its practices in the areas of pay, promotions, and pregnancy-related matters. After the verdict the company said it would appeal.
Karin Kamp in New York, swissinfo.ch