Google is to pay $28m (£21.5m) to settle racial bias claims against the business, according to lawyers involved in the case.
The technology giant had been accused of giving white and Asian workers better pay and career progression opportunities than those from other ethnic backgrounds.
According to news agency Reuters, a class action lawsuit was filed on behalf of at least 6,632 individuals who worked at Google between 15 February 2018 and 31 December 2024.
The company has now agreed to settle the case but denies the allegations, which were originally filed in 2021.
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Former employee Ana Cantu claimed individuals from Hispanic, Latino, Native American and other diverse backgrounds were often paid less and started work in lower-level positions than their white and Asian colleagues, even when carrying out the same duties.
A Google spokesperson said: “We reached a resolution, but continue to disagree with the allegations that we treated anyone differently, and remain committed to paying, hiring, and levelling all employees fairly.”
Cathy Coble, founding partner of civil rights law firm Gunn Coble representing the claimants, commended Cantu, who had risked her career to raise race/ethnicity pay disparity at “one of the most powerful companies in the world”.
Also recognising the bravery of employees who had self-reported their pay and leaked that data to the media, she highlighted that their actions had enabled the law firm to push for discovery of the data necessary to support this class action. She said: “Suspected pay inequity is too easily concealed without this kind of collective action from employees.”
Coble’s co-founder Beth Gunn added: “Committing to closing the loopholes allowing discriminatory wage gaps to continue will stop losses of millions of dollars in employee take-home pay and tax revenue to the State, and ensure that workers of diverse races and ethnicities are equitably compensated. We hope this result will prompt California employers to seriously commit to this goal.”
As part of the agreement, Google has committed to working with both a labour economist and an occupational psychologist, who will evaluate the company’s yearly pay equity reviews and its method for assigning initial job levels. Their suggestions will be considered to address the claims brought forward in the case.
Last month, Google owner Alphabet said it would no longer set hiring targets to improve the representation of diverse groups in its workforce.
Liz Stevens, employment professional support lawyer at law firm Birketts, said: “The Google case appears to have some parallels with ongoing group equal pay claims in the UK, which are based on the premise that women are paid at a lower rate than men doing the same or broadly-equivalent work.
“The lack of pay transparency generally in this country, and lack of reliable data on pay discrepancies between different ethnic groups, would make it difficult for a claim of discrimination to be pursued in the same way here. UK equal pay legislation currently only applies to claims of unfair pay differentials between men and women.”
She believes the government’s new consultation on its plans to introduce compulsory ethnicity (and disability) pay gap reporting for employers with 250 or more employees, which will potentially make it much easier to identify pay disparities between different ethnic groups, is intended to encourage large employers to take action to reduce any disparity.
“The new reporting obligation will broadly mirror the existing duty for large employers to report their gender pay gap data annually, and may go some way to help reduce any similar pay differences to those reported in the Google case,” Stevens added. “As well as introducing the new duty to report pay gaps based on ethnicity and disability, the forthcoming Equality (Race and Disability) Bill is also expected to introduce the right for ethnic minorities and disabled people to pursue claims for equal pay, representing a considerable expansion in scope of the current legislation.”
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