A trio of women who battled against discrimination in the male-dominated world of American finance have won a $33m (£16m) legal settlement that will compensate thousands of underpaid female employees and marks another step in the fight against sexism, bullying and unequal pay on Wall Street.
The women – advisers to the wealthy clients of Smith Barney, one of the industry's largest brokerages – were toasting the end to a three-year legal slog and a struggle against discrimination that goes back many years.
When Renee Fassbender Amochaev, Deborah Orlando and Kathryn Varner first began grumbling that they were being fobbed off with the least lucrative client work, while the men the richest clients among themselves, they were initially ignored, then ridiculed – and ultimately forced out.
The class action lawsuit that culminated in the historic settlement, one of the largest on Wall Street, was a final desperate step, the women said when they launched it in 2005.
Smith Barney had already promised to install anti-discrimination policies as part of an earlier legal settlement in 1998. In that case, women at a New York branch of the business had alleged a macho culture ruled over by a bullying boss who cultivated a fraternity house environment. Drinking parties were held regularly for mainly male brokers, where they drank bloody marys from a barrel and subjected female colleagues to lewd pranks. The revelations shamed Wall Street and analysts believe Citigroup, Smith Barney's parent company, had to pay out more than $100m in damages that time, with millions more in "diversity training" for its managers.
But Fassbender Amochaev, Orlando and Varner claimed Smith Barney had still not been dragged into the 21st century.
Since brokers take a cut of their client's wealth, in return for investing it wisely, being fobbed off with second-rate clients amounted to a pay cut that could run into hundreds of thousands of dollars over time. Male brokers clubbed together into client-sharing partnerships, while women were given less administrative support, and had to endure a hostile working environment.
When Ms Fassbender Amochaev complained over the head of her unsympathetic branch manager, male colleagues circulated a petition supporting him.
"These are very courageous women," the trio's lawyer, Kelly Dermody, said yesterday. "I wish I could say that we are coming to the end of the era of sex discrimination lawsuits, but there are major institutional problems that remain on Wall Street. There is a lot less gross sexual harassment than 10 years ago but the dollars-and-cents issue of pay and promotion, and other barriers to women, they still remain."
A fourth plaintiff, Judy Weil, dropped out of the case one year in; but two more from the southern California and Florida offices put their names to the litigation, and by this year 2,500 current and former employees had swung behind the class action and were demanding redress for discrimination against them. With that momentum, Citigroup decided to stop fighting.
When the women went public in 2005, the company went nuclear. It said the women got all the business, and all the compensation, that they were worth.
Citigroup said yesterday: "We're pleased to have this matter moving toward final resolution. Significant initiatives in the last several years have helped establish Smith Barney as one of the most progressive employers in the securities industry and we are committed to continuing to provide a professional and respectful work environment to all of our employees."
As part of the settlement, Smith Barney is to appoint a diversity monitor and an industrial psychologist charged with re-educating the "good old boys".