Alphabet, Google’s parent company, announced that it has reached a settlement worth $310 million in a shareholder lawsuit over the way it handled allegations accusing executives of sexual misconduct.
This was meant to solve concerns at Alphabet, that were part of a chorus of voices denouncing the existence of a sexist culture in male-dominated Silicon Valley.
In the announcement the tech giant said that the settlement is meant to prevent anyone who are fired for misconduct or a subject to a sexual misconduct allegation, from receiving severance packages.
The company is also forming a team, where employees can arbitrate their claims, and also to receive inquiries and claims that are targeting its executives.
Four key changes Alphabet is making:
- Setting up a DEI Advisory Council to advise on and oversee these efforts. The advisors report to the Leadership Development and Compensation Committee of the Board (LDCC) on a quarterly basis.
- Building on its existing practice of prohibiting severance for anyone terminated for any form of misconduct, Alphabet is expanding the prohibition to anyone who is the subject of a pending investigation for sexual misconduct or retaliation.
Managers will also receive guidance instructing them on how misconduct should impact an employee's performance evaluation, compensation decisions, and promotion outcomes.
- Allegations against executives will be assigned to a specialist team, and the results of any case will be reported to the Board’s Audit Committee.
- Alphabet spends $310 million in settlement to fund diversity, equity and inclusion initiatives and programs focused on increasing access to computer science education and careers.
“Recent years have involved a lot of introspection and work to make sure we’re providing a safe and inclusive workplace for every employee. That doesn’t stop here and you’ll receive reports on our progress as we move forward," said Eileen Naughton, VP of People Operations at Alphabet.
"I’m grateful to everyone, especially our employees and shareholders, for providing us with feedback, and for making sure that the way we tackle these vital issues is better today than it was in the past."
The settlement comes after thousands of Google employees walked out of work in 2018 to protest the $150 million stock grant and the $90 million in severance Android creator Andy Rubin received despite multiple claims of misconduct against him. Shortly after that, shareholder lawsuits swiftly followed.
Alphabet responded by opening up an investigation into its process of handling sexual misconduct claims.
Alphabet and Google CEO Sundar Pichai sent a warning to all employees in an email, pointing them to the settlement between the company and shareholders, who alleged it did not respond appropriately to claims of sexual misconduct and harassment.
"I hope these commitments will serve as a strong signal to all of you that we are not going back in time," Pichai said in the brief memo to employees.
"It's very important to me that we hold ourselves to the highest possible standard as a workplace on issues of misconduct, and provide care and support to people who report it. I've been working closely with our teams and our board to ensure that we are doing this."
"I'm personally dedicated to doing the hard work ahead and building on the progress we've been making together to build a better Google for everyone," Pichai's note closed.
It should be noted that the changes also include some refinements in Alphabet's policy about excessive drinking of alcohol at work-related events to curb chances of inappropriate behavior.
The settlement also includes Google and Alphabet's "Other Bets" divisions which include the Waymo autonomous car unit and Verily life sciences initiative, among others.