Microsoft Discrimination

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Case Details
Case Code:HROB011

HR Problems
Period:1997 - 2001
Pub Date:2001
Teaching Note:Available
Organization:Microsoft Corporation
Industry:Information Technology

The case examines the charges of gender/racial discrimination and sexual harassment against leading IT company Microsoft. It explores in detail the treatment meted out to female employees in the company's initial years and the measures Microsoft took to improve the work culture of the organization. The case also discusses the lawsuits against Microsoft that allege racial discrimination, and analyzes the implications of such changes for the company.


» Factors that contribute to discrimination and harassment, and the impact of such behavior on the company and its employees Contents:
Charges of Discrimination
Background Note
About Racial/Gender Discrimination & Sexual Harassment
The Charges against Microsoft
In Trouble - Again

Key Words:
charges, gender, racial, discrimination, sexual harassment, IT, company, Microsoft, treatment, meted, female employees, initial years, Microsoft, improve, work culture, organization, lawsuits "How is Microsoft responsible for my stress disorder? Simple, 12 years of subjecting me to unequal and contradictory treatment, debasement, sexual harassment and outright illegal practices in its hiring, management, and disabilities protocols." - A former female Microsoft employee, in December 1997.

"There are glass ceilings and glass walls in place for African Americans at Microsoft. We are stunned and disappointed in their treatment of Black employees." - Willie Gary, lawyer of an ex-Microsoft African American employee, in January 2001. Charges of Discrimination

In January 2001, seven of Microsoft's former and current African-Americans employees filed a discrimination suit against the company. One of the largest discrimination suits ever filed in the US, it alleged racism and plantation mentality (1) at their workspace and sought $ 5 billion in damages. Microsoft was accused of discriminating against its employees through performance evaluations, pay packages, promotions, wrongful terminations and retaliation. This suit consolidated all the discriminatory suits filed separately by the seven employees. The suit was subsequently given the status of a class action, (2) extending its reach to Microsoft's vast base of former and current African-American employees. Thus, all the former and current African-American salaried employees employed by Microsoft (in the US) on or after October 4, 1997 and all the former and present female salaried employees employed by Microsoft on or after February 23, 1999 were included in the suit. The filing was primarily based on the existing case of Rahn Jackson, (3) one of the first Microsoft employees to take legal action against Microsoft for racial discrimination. The plaintiff claimed that Microsoft's employment policies and practices permit its managers to exercise discretion when deciding on evaluations, pay packages, promotions and job selections, resulting in decisions that reveal a race/gender bias. During the early 1990s, much discrimination related suits had been filed against Microsoft. In the Donaldson (4) Vs. Microsoft case, the plaintiff alleged that Microsoft discriminated against the Black and female workers by paying them smaller salaries, bonuses and stock options than it paid white males performing the same work. The suit also alleged that Microsoft had even retaliated against Black and female employees who protested against this discrimination.

1] Plantation mentality is described as an institutionalized racial bias against minorities, more specifically African-American employees. Institutionalized racial bias includes harassment, smaller pay packages, denial of promotions or raises, and retaliations, all on the basis of class/race.

2] A class-action suit refers to...
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