Walt Disney has reached a $43.3 million settlement in a lawsuit that accused the entertainment giant of underpaying its female employees in California by a staggering $150 million over an eight-year span.
The case, brought forward by thousands of current and former female employees, has drawn attention to gender-based pay disparities within one of the world’s most iconic companies. According to the plaintiffs’ attorneys, the settlement includes measures to ensure that Disney addresses pay equity moving forward, reflecting broader societal pressures to bridge wage gaps in the workplace.
As part of the agreement, Disney will engage a labor economist for three years to evaluate pay equity among its full-time, non-union California employees below the vice president level. The economist will identify and address pay disparities to ensure a fairer compensation structure.
This step is a significant commitment for Disney, signaling an acknowledgment of the systemic concerns raised by the lawsuit, even as the company has denied the allegations. The settlement illustrates a shift toward more accountability in corporate America regarding wage equity.
The lawsuit was originally filed in 2019 by LaRonda Rasmussen, a Disney employee who discovered that six male colleagues with the same job title earned significantly more than she did. One of those men, despite having several years less experience, earned $20,000 more annually.
Rasmussen’s case struck a chord, eventually leading approximately 9,000 female employees to join the class-action suit. Disney sought to prevent the case from becoming a class action, but a judge allowed it to proceed in December 2022, marking a major turning point in the litigation.
Lori Andrus, a partner at the law firm Andrus Anderson, praised the courage of Rasmussen and the other women who pursued the lawsuit. “They risked their careers to raise pay disparity at Disney, one of the largest entertainment companies in the world,” Andrus said in a statement on Monday.
The case underscores the personal and professional risks often faced by employees who challenge systemic inequality, particularly within large corporations. Their persistence has now paved the way for meaningful change within Disney and possibly beyond.
The claims of pay disparity were supported by an analysis of Disney’s human resource data, conducted by labor economist and University of California Irvine professor David Neumark. His study, which examined data from April 2015 through December 2022, found that female employees were paid approximately 2% less than their male counterparts.
This seemingly small percentage translated into significant financial losses for thousands of employees over time, reinforcing the validity of the lawsuit’s claims. Despite the findings, Disney has continued to dispute the allegations and did not provide an immediate comment following the settlement announcement.
The settlement agreement, which was filed in California state court, still requires judicial approval before it can take effect. If approved, it will mark a notable victory in the fight against gender-based pay discrimination in the entertainment industry.
While Disney has not admitted wrongdoing, the settlement serves as a reminder of the ongoing challenges women face in achieving pay equity. It also highlights the importance of transparency and accountability in corporate practices, setting a precedent that other organizations may be pressured to follow.
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