A class action lawsuit filed this week accuses Toshiba's U.S. arm of discrimination against female employees. The suit, filed in New York, alleges that the computer corporation favors men for promotion opportunities and pays women lower salaries and bonuses.
Lead plaintiff Elaine Cyphers says in the complaint that Toshiba's six-year-old “Gender Equality Office” hasn't prevented an “astounding lack of women in leadership positions”; Cyphers says that a mere 3.4 percent of the company's 6,273 executives are women.
“The numbers are atrocious,” Cyphers's attorney David Sanford, a partner with Sanford Wittels & Heisler, told Reuters in an interview. “We believe the class claims are significant, and will be substantiated in the litigation.”
The issue came up last June at a shareholder meeting in Tokyo, when one shareholder asked why none of Toshiba's executives are women. A Toshiba executive replied that the company wasn't “discriminating at all. It’s just that we haven’t found appropriate candidates. We expect to have female executives in near future.”
But that promise wasn't enough to hold off Cyphers's suit, which seeks $100 million in damages and seeks to represent a class of as many as 8,000 U.S. employees.
Cyphers, who is the highest-ranked U.S. employee with Toshiba's America Nuclear Energy Corp unit, says Toshiba paid her between $90,000 to $91,800 per year since she started in 2008, while similarly-employed men were bringing home around $120,000 a year.
Cyphers started her job at Toshiba in June 2008 after working for 25 years in the human resource departments of other companies. She says that Toshiba tried to force her from the company after she complained about the discrimination alleged in her complaint. She also says that the company promoted a man with less experience shortly after she began her job.
The suit highlights the larger problem of gender equality in Japanese corporations. A study performed by Toyo Keizai, a business publisher, found that a mere 1.2 percent of executives at Japanese companies were female. By contrast, a survey by the nonprofit firm Catalyst, Inc. found that 13.5 percent of executives at U.S. Fortune 500 companies are women.
Sanford Wittels, the firm handling the case, obtained a $175 million settlement against the U.S. arm of Novartis last July, following an employment discrimination suit.
The suit comes just a few months before the U.S. Supreme Court hears an employment discrimination action alleging that female employees of Wal-Mart are paid less, given smaller raises, and promoted less often than their male colleagues. The suit, which potentially puts Wal-Mart on the hook for up to $1 billion, is the largest employment discrimination suit in history. Whether Wal-Mart wins or loses, the case will give plaintiffs a better idea of how to certify a successful employment class action.