WHAT EMPLOYERS CAN LEARN FROM THE PAO v. KLEINER PERKINS TRIAL

After a jury trial in San Francisco Superior Court lasting 24 days, jurors returned a verdict in favor of the defendant, venture capital firm, Kleiner Perkins Caufield & Byers, on allegations that it had unlawfully terminated plaintiff, Ellen Pao, based upon her gender.

Pao, who joined Kleiner Perkins as a junior partner in 2005, claimed that management of the venture capital firm based in Silicon Valley discriminated against her by excluding her from male-only social events, ignoring her at meetings and failing to promote her to senior partner. Pao received mixed performance reviews during her time at Kleiner Perkins; and ultimately, the firm terminated her in October 2012, purportedly due to her performance issues. Pao claims that the termination was in retaliation for her earlier complaints of gender discrimination.

The case has generated publicity due to the highly debatable topic of gender inequality in the workplace. Some advocate that Pao’s termination was black and white; Pao’s performance reviews show that Pao was not meeting the firm’s expectations. Others argue, despite insufficient direct evidence, that since Pao could not get into “the boy’s club” at Kleiner Perkins due to her gender, she was treated less favorably than her male colleagues, which ultimately cost her job.

After the verdict, Pao, who now serves as the interim CEO of the internet website Reddit.com, said in interviews that women are underrepresented in the tech field, and that women like Sheryl Sandberg (COO of Facebook) and Marissa Mayer (CEO of Yahoo), are the few exceptions in the male-dominated field. Pao expressed that opportunities for women and minorities in the tech field should start at the collegiate level, but that employers should strive to diversify their workforce. Pao says Reddit now asks job applicants about their views on diversity, and has a policy against salary negotiations, which studies show are more likely to benefit male candidates.

Even though Kleiner Perkins successfully defended against this lawsuit, employers should protect against similar harmful, disruptive and costly litigation by documenting employee complaints, establishing and enforcing policies against harassment and discrimination, and ensuring that hiring, wage increase, termination and promotional procedures do not lead to disparate treatment between the sexes.

Even with these safeguards, when an allegation of discrimination is made, employers can face uncertain litigation outcomes, and/or investigation or prosecution by the Equal Employment Opportunity Commission. The St. Louis employment attorneys at McMahon Berger have been representing employers across the country in labor and employment matters for almost sixty years and are available to discuss these issues and others.  As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation as every situation must be evaluated on its own facts. The choice of a lawyer is an important decision and should not be based solely on advertisements.

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