PricewaterhouseCoopers LLP has agreed to pay nearly $12 million to a group of unsuccessful job applicants to close the book on a California federal suit accusing the accounting firm of age discrimination.
On Tuesday, named plaintiffs Steve Rabin and John Chapman asked U.S. District Judge Jon S. Tigar for preliminary approval of a deal in which PwC agreed to pay $11.6 million to resolve allegations that it violated the Age Discrimination in Employment Act by systematically favoring younger applicants and denying older candidates jobs that they were qualified to perform.
Judge Tigar had conditionally certified the collective action last year, which the parties estimated extended to some 5,000 individuals. Around 3,500 individuals have opted into the suit so far, according to Tuesday’s motion.
On top of the monetary payout, PwC also agreed to revamp its hiring procedures to better recruit older workers for low-level jobs and limit the potential for age bias to creep into the process. The settlement included no admission of liability by PwC.
“The [$11.6 million] common fund plus the programmatic relief constitutes fair, reasonable, and adequate compensation for the class members, in light of potential value of their claims,” the applicants said in Tuesday’s motion.
First filed in 2016, the suit accused PwC of flouting the ADEA as well as several state anti-discrimination laws. Rabin, a certified public accountant, alleged he was denied a job as a seasonal experienced associate in 2013 when he was 50 years old. He also claimed PwC had a “stunningly low” number of older workers in entry-level and lower- to mid-level positions.
Rabin also claimed that PwC “rarely” advertised entry-level openings publicly, that it mostly hired entry-level accountants through campus recruiters and that people who aren’t affiliated with a college can’t apply for those entry-level positions, according to the complaint. Chapman later joined the suit as a named plaintiff asserting claims under Michigan state law.
In 2017, Judge Tigar turned down PwC’s bid for judgment on the pleadings, rejecting the company’s argument that the ADEA doesn’t permit job applicants to bring disparate impact claims.
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“At the close of the case PwC would likely seek a new appeal to the Ninth Circuit,” the applicants said. “There, if plaintiffs prevailed, it would create a circuit split, increasing the likelihood that the Supreme Court might weigh in and reverse.”
The proposed settlement would cover a collective under the ADEA as well as classes brought under both California and Michigan state laws.
Additionally, the procedural changes PwC agreed to make over a two-year period include bringing aboard a neutral consultant who will conduct age inclusivity training for company leadership and employees who are part of the hiring process and offer ideas about how to recruit workers over 40 for positions specified in the settlement.
PwC also agreed to advertise job openings directly to older applicants and include age as a protected category under the company’s nondiscrimination policy, among other things.
Rabin and Chapman would each stand to receive $20,000 service awards as part of the agreement. Class counsel also indicated that it intends to ask for 35%, or about $4 million, to cover attorney fees, saying the nonmonetary elements of the agreement make the deal’s true value millions higher than the amount in the settlement fund, according to Tuesday’s motion.
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The applicants are represented by Jahan Sagafi, Laura (Iris) Mattes, Adam Klein, Melissa Stewart, Daniel Stromberg and Lucy Bansal of Outten & Golden LLP, Daniel Kohrman, Laurie McCann and Dara Smith of AARP Foundation Litigation and Jennifer L. Liu of The Liu Law Firm PC.
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The case is Steve Rabin et al. v. PricewaterhouseCoopers LLP, case number 3:16-cv-02276, in the U.S. District Court for the Northern District of California.
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