Lessons from the litigants


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FT.com article published May 2010 in which Wendi Lazar is quoted.

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Lessons from the litigants

  1. 1. NEW YORK CONNECTICUT 3 Park Avenue Four Landmark Square New York, NY 10016 Stamford, Ct 06901 212-245-1000 203-363-7888 www.outtengolden.com Lessons from the litigants By Emma Jacobs - published: March 31 2010 Taking her former employer, Investec Hender- son Crosthwaite, the financial group, to court was the right decision, according to Louise Barton. “I have no regrets. I’d do it again,” the former media analyst says. The benefits, she be- lieves, outweighed the huge stress of undertak- ing a legal battle. “You get keyed up about it. It affects your family and makes you unbearable to live with. You are completely consumed by anger and unable to focus on anything else.” While it is the millions of pounds and dollars claimed by workers who sue their City of London and Wall Street employers on age, sex or race discrimination that usually grab the headlines, one untold story is the impact such court cases have on the lives and careers of litigants. Most people approached for this article declined to comment because of concerns over breaching confidentiality agree- ments or because they preferred to make a fresh start in new employment and did not want their colleagues to deem them a troublemaker. Ms Barton, by contrast, is keen to stress that most people who take their employers to court do so with conviction and with a heavy heart. “Women I know who’ve taken such cases aren’t troublemakers – they’ve been pushed too far and once they break, they dig their heels in and come out fighting,” she says. “If they decide to take a case after 20 years in the mar- ket they do so because they have been pushed to breaking point and have a case.” In fact, she believes many of the sex discrimination cases that appear in the news make the process look frivolous and are contemptuous of women who go to tribunals for “trivial things like having their cleavage leered at or accompanying clients to lap-dancing clubs”. Ms Barton, who started her City career in the 1970s, insists “if you work in the City you must be able to deal with a highly competitive environment. Men can be just as cruel to other men as they are to women. Cases over trivial matters alienate women in the workforce.” Ms Barton’s high-profile discrimination and equal pay claim was settled in 2003 for an undisclosed sum. She filed the complaint after discovering a junior male colleague had received a bonus of £1m in the year she was awarded £300,000. “I knew, due to retirement, I wouldn’t have another opportunity, that this was my last chance to make good money,” she explains. “And I didn’t think it was fair that I was paid less than some Young Turk who contributed less than I did.” FT.com article March, 2010
  2. 2. Lessons from the litigants (Cont*) If age discrimination laws had been an option, Ms Barton says, she would have used those instead of sex discrimination (age discrimination rules were not introduced in the UK until 2006). “It was an equal pay case, not really a sex discrimina- tion case. I believe some men in the office should have taken the same case as me at the time, but until recently didn’t have the law to fight it.” Men are doing it too ● London-based banker Achim Beck won an age discrimination case at the end of 2009 against Canadian Imperial Bank of Commerce after being fired at the age of 42 during the credit crisis. A UK employment tribunal found that senior CIBC executives used a “sham” redundancy process to replace Mr Beck with someone younger. ● Australian-born Malcolm Perry brought a £10m claim against Dresdner Kleinwort in 2007 for allegedly treating him less favourably than the bank’s German and German-speaking employees. An employment tribunal rejected his claims after a full hearing. ● In 2007, Peter Lewis, a former senior banker at HSBC, lost his long-running claim that the banking group discriminated against him because he was gay. The ordeal of going to court is a deterrent, says Wayne Outten, a New York-based employment lawyer who represented Allison Schieffelin, a former employee in Morgan Stanley’s institutional equity division, who served as lead plaintiff in a discrimination suit against the company that settled for $54m in 2004. “Most people who have grievances just suck it up, get a transfer or leave their company,” he says. For some, he adds, approaching the personnel department is difficult. “Many employees don’t feel human resources are there to help them but rather to protect management and the company line. So they are unprepared to register a com- plaint,” he says. Renee Amochaev, a former financial adviser at Salomon Smith Barney based in California, says this reflects her experience when she began consulting lawyers about a possible discrimination case against the company in 2003. “Initially, I thought that HR was there to help me but they were very difficult and hostile,” she says. “I was flabbergasted. Despite supposedly being confidential it soon got out and I was treated like a pariah. I felt like I was in an episode of [the reality television pro- gramme] Survivor. It was as much from women as men. People would leave the room when I walked in; everyone seemed to turn on me.” She stuck it out for a year before leaving for Wachovia Securities. In 2005, she was made one of the named plaintiffs in a class-action gender discrimination complaint against her former employer. It was alleged that the company’s branch managers steered clients to male brokers, reducing the potential earn- ings of female employees. They also claimed that Salomon Smith Barney did not provide enough opportunities for women to become partners. The women contended that they received less sales support than male colleagues, less desirable offices and less training. Ms Amochaev was unprepared for other people’s reactions: “I had threats from other brokers. I was snubbed in the street and badmouthed in social circles.” But she also received a lot of support from women who called to tell her their own experiences and urged her to continue with the fight. “I’d felt so alone and that I’d lost everything. Now I felt if I didn’t do anything I’d be letting others down.” The case was settled out of court just before it was due to go to trial in August 2008. Citigroup agreed to pay $33m to settle sex discrimination claims against its Salomon Smith Barney brokerage unit. About 2,500 women were eligible for a share of the compensation fund. Even if a company agrees that there is a legitimate complaint and privately awards financial compensation, however, Mr Outten argues that there is a risk to an employee’s career. “From the public point of view, the impact is less as both parties tend to sign confidentiality agreements. But Wall Street is small and word gets around,” he says. FT.com article March, 2010
  3. 3. Lessons from the litigants (Cont*) Wendi Lazar, a New York employment lawyer, adds that the higher up the career ladder you are, the more likely that such rumours will spread. “If you’re at a senior level and you sign a confidentiality agreement and negotiate a severance pack- age, people will want to know why you went,” she says. “The talk will be: ‘She’s such a star, why did she leave?’” It is also worth remembering that taking a complaint to an employer is not always irreversible. She recalls one client who was on the brink of signing a severance package at a big investment bank before revoking the arrangement. Two years later she is still at the bank and, according to Ms Lazar, “very happy”. If you do decide to embark on a court case, Mr Outten advises, you will need “a strong constitution. It gets very personal. People will find everything bad to say against you and some more. I’ve seen people very disappointed and bitter after peo- ple have told them they will support them and then, when it comes to it, they don’t. It can be brutal.” Ms Amochaev says her case consumed her life. “After work I would spend hours writing legal notes down. It had a physi- cal toll. I had my gall bladder removed as a result of being so sick and stressed out,” she says. Yet in spite of being snubbed by friends and former colleagues, racking up large medical and legal bills, she insists that the experience was positive overall. “I gained a huge amount of confidence from women coming forward. On that reason it makes me feel I could stand up to anything.” A side-effect was that she also attracted a number of female clients. “I began to grow my business among female inves- tors,” she says. “The female market is growing, so it makes sense to have more female brokers. Suddenly I realised this was an opportunity to develop my business.” Many women have also asked her for advice. “I say if you believe you’re doing the right thing, then do it. If it’s purely financial, it probably isn’t worth it. But if it’s [to fight against] social injustice, then it is worth doing.” Ms Barton says her fears that she might not find work after suing her former employer proved groundless – on the day she settled, she received two job offers. “If you’ve been around the City a long time, you’re a known entity,” she says. “Some respect you for standing up to your employers, taking the view that you are a fighter, rather than a troublemaker.” FT.com article March, 2010