Microsoft agrees to pay $14 million to settle alleged breach of California workplace regulations

The Microsoft logo is illuminated on a wall during a Microsoft launch event to introduce the new Microsoft Surface laptop and Windows 10 S operating system, May 2, 2017 in New York City
(Image credit: Getty Images)

Microsoft has reached a settlement agreement with the California Civil Rights Department (CRD) of over $14 million ($14,425,000) to resolve workplace regulation violations, according to the CRD

Microsoft stood accused of discriminating against workers ‘protected leave’ provisions, which are protected by both state and federal law, including parental, disability, pregnancy, and family care taking leave.  

As part of the settlement, Microsoft has committed to preventative measures going forward to avoid future discrimination and to provide financial remuneration for employees using protected leave between 2017 and 2024. The court has not yet approved the settlement. 

This settlement comes on the back of a multi-year investigation into Microsoft, with the CRD claiming that employees who used protected leave received smaller bonuses and negative performance reviews. 

The CRD also suggested that Microsoft “failed to take sufficient action” to prevent such workplace discrimination and ultimately affected the “career trajectory” of women, people with disabilities, and others.  

The settlement will aim to rectify these damages and, if approved by the court, will require Microsoft to pay out the specified amount to cover direct relief for workers and the costs of the CRD’s enforcement efforts.

It will mandate that an independent consultant provide oversight on Microsoft’s personnel policies, instructing workers in the correct process for making complaints and helping to manage an annual report on settlement compliance.

It will also ensure managers and human resources staff undertake specific training courses on discrimination over the use of protected leave. 

“Whether it’s to look after a newborn child or take care of your own health, workers generally have the right to take time off without worrying about consequences at work,” CRD Director Kevin Kish said.

“By allegedly penalizing employees for taking protected forms of leave, Microsoft failed to support workers when they needed to care for themselves or their families. The settlement announced today will provide direct relief to impacted workers and safeguard against future discrimination at the company,” he added. 

Kish added that he applauded Microsoft for “coming to the table” over this issue and agreeing to make the protective changes laid out in the settlement. 

The CRD stated that no action is needed from employees covered by the proposed settlement and that covered workers will receive further updates dependent on court approval.

“Microsoft is committed to an environment that empowers our employees to take leave when needed and provides the flexibility and support necessary for them to thrive professionally and personally. While we believe the agency’s allegations are inaccurate, we will continue to listen, learn, and support our employees,” a Microsoft spokesperson told ITPro.

George Fitzmaurice
Staff Writer

George Fitzmaurice is a staff writer at ITPro, ChannelPro, and CloudPro, with a particular interest in AI regulation, data legislation, and market development. After graduating from the University of Oxford with a degree in English Language and Literature, he undertook an internship at the New Statesman before starting at ITPro. Outside of the office, George is both an aspiring musician and an avid reader.