Morgan Stanley Settles Lawsuit for $46M Associated Press Published: April 24, 2007 NEW YORK — Morgan Stanley said Tuesday it has settled a gender bias class-action suit that alleged the New York investment bank discriminated against female brokers and trainees in promotion and compensation. Under the terms of the settlement, subject to the approval of the U.S. District Court for the District of Columbia, the company set aside $46 million to pay claims of discrimination. The firm also will adopt new methods to ensure women aren't discriminated against when accounts of brokers who depart or go into management are redistributed and will establish new programs for training female brokers for management jobs.
The parties estimated that over the next five years the bank will spend $7.5 million on training and that female brokers' pay will go up by $16 million.
The suit was filed in June by six former Morgan Stanley female brokers. The class includes about 2,700 claimants who worked at the firm's retail brokerage division between Aug. 5, 2003, and the present. Morgan Stanley employs about 8,000 brokers.
The suit alleged the company discriminated against women in training and mentoring, account assignments, and participation in company-approved "partnership" arrangements with other brokers.
Some of the plaintiffs also claimed they were discriminated against during a round of layoffs in August 2005, when the company fired around 1,000 underperforming brokers. Some have claimed they were discriminated against on the basis of age.
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