California gender discrimination has long kept well-qualified women out of the upper echelon of the workforce. The so-called glass ceiling may have been shattered at some firms, but at others, it remains firmly intact. In some cases, top-level female executives and other employees have been able to prove via Los Angeles gender discrimination lawsuit that it was in fact their status as a woman that led to doors closing on key opportunities and benefits.
Now, California has become the first state to require gender diversity in the boardroom. SB 826 mandates at least one female board member for every publicly-held corporations with principle executive offices in the state by the close of next year. By 2021, companies (depending on their size) will need to have at least two or three women. For the hundreds of firms that will be affected, failure to comply will result in a $100,000 fine for the first offense and $300,000 for the second.
However, Los Angeles gender discrimination lawyers know the law is likely to face legal challenges. Gov. Jerry Brown, who signed the law in September, admitted as much. Still, it’s worth noting more than a quarter of companies that are publicly-traded do not have a female member on the board – despite copious research that firmly establishes firms that do score better in areas of productivity and profitability.
Although California is the first state in the U.S. to pass such a measure, other countries such as Norway, Germany and France have done so with success.
Critics of the law say it is unwise and more than likely will face legal challenge, the success of which would be questionable. Some business law attorneys and scholars have argued the measure, opposed by the California Chamber of Commerce, amounts to a quota that is unconstitutional. They say company shareholders should have the freedom to hire whomever they wish without having to factor one’s gender. Others have expressed concern despite the measure’s intent that it could prioritize gender over other diversity standards and may be a violation of the publicly-held affairs doctrine.
As long-time gender discrimination attorneys in L.A., we recognize that any kind of gender preference in policy or practice is going to be subject to fierce opposition, and some corporations have already indicated they’re gearing up for a fight. If the law is to pass the constitutional test, the state will have to show that there is a solid reason for the government to take this initiative and that there isn’t any other way to achieve the stated better outcome.
Lack of gender diversity at the highest levels of power is unequivocally a serious and pervasive problem. The question question is whether the solution needs to be legislative. It’s likely the courts will decide.
In the meantime, even women who have made it to the boardroom, proving their qualifications and merits, aren’t guaranteed to be free of gender discrimination. Just recently, the former vice president of Goldman Sachs Group in L.A. filed a gender discrimination lawsuit, alleging after 15 years on the job, she was promptly fired after revealing to her boss she was pregnant with her third child. Although the company offered a generous family-friendly policy that included four months of paid maternity leave (as do many elite companies to be competitive in attracting talent), many employees fear if they fully take advantage, they’ll be penalized – which is exactly what plaintiff said happened. Bloomberg reports plaintiff executive’s termination followed remarks from her male supervisor (and father-of-four himself) regarding her ability to balance a demanding job and remarking she now had “a lot of mouths to feed.” The company denies the motivation was gender-based, insisting the reason was, for “strategic business purposes.”
Contact the employment attorneys at Nassiri Law Group, practicing in Orange County, Riverside and Los Angeles. Call 949.375.4734.
SB-826 Corporations: boards of directors, Sept. 30, 2018, Legislative Counsel’s Digest
More Blog Entries:
Employee Lactation Accommodation Rights Bolstered in California With AB 1976, Dec. 4, 2018, Los Angeles Gender Discrimination Attorney Blog