HR Management & Compliance

Sex Discrimination: Employer To Pay High Price For Glass Ceiling

In recent years, government agencies and female employees alike have increasingly focused on shattering the corporate glass ceiling. Now, a new California Court of Appeal decision demonstrates that failing to review your promotion practices before a gender-bias complaint surfaces can be an expensive mistake.

Female Employee Denied Promotions

When Vibeke Cloud, director of financial consolidations for Litton Industries, Inc., in Los Angeles, expressed her goal to become Litton’s controller, she was allegedly told that the company’s chief financial officer “will not stand for a woman in that position.” Cloud later applied for an assistant controller position, but it went to a male worker. She was told she was fully qualified, but that the company didn’t see a woman in that position. After Litton spun off its Western Atlas business unit several years later, Cloud sought to be its controller, but again a man got the job. When Cloud objected, the Western Atlas CEO told her she had a reputation for being “too tough” and working her staff too hard, plus she didn’t have operating experience. She was urged to take an assistant controller position at Western Atlas, with assurances that other opportunities would arise. She accepted the job, but when no better opportunities were offered to her over the next year, she quit.

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Company Hit With Constructive Discharge And Sex-Bias Claims

Cloud sued Litton and Western Atlas, claiming she was denied advancement because of her gender. She also said she was constructively discharged-forced to quit because of intolerable working conditions.

Gender Bias Yields Big Damages

The jury agreed that Cloud was the victim of gender bias. The Court of Appeal upheld this finding, but also ruled that Cloud’s resignation wasn’t a constructive discharge because her employment conditions weren’t so intolerable as to cause a reasonable person to quit.The appellate court returned the case to the trial court to determine the appropriate dates for computing damages, such as the date the controller position would have become available or her projected retirement date. If damages are calculated to her expected retirement, Cloud could recover more than $875,000 in lost earnings and stock options, plus punitive damages and upward of $420,000 in attorneys’ fees and costs.

4 Approaches To Take

If women are underrepresented in your upper ranks, it’s critical to address glass-ceiling issues. A number of approaches can help:

  1. Offer valuable assignments. Make sure women are afforded opportunities that make them more promotable, including high-profile assignments, training and the right to attend high-level meetings.


  2. Use clear and easily understood written standards. To the extent possible, have clearly written performance and promotion guidelines. And be sure to document your legitimate reasons for selecting one person and rejecting others.


  3. Encourage mentoring. If formal or informal mentoring contributes to success in your firm, look closely at whether women are invited to participate as often as men.


  4. Expand job announcements to include high-level positions. Try to ensure that women have access to information about top job opportunities and don’t have to rely on word of mouth.