Los Angeles, California – The Walt Disney Company has agreed to a significant $43.25 million settlement to resolve a class-action lawsuit alleging systemic gender pay discrimination against thousands of current and former female employees in California. The agreement, filed for preliminary approval, addresses claims that women were paid less than their male counterparts for substantially similar work. The lawsuit, initially filed in 2019, highlighted a critical debate over how job differences are considered in pay equity cases.
The legal action began with LaRonda Rasmussen, a financial analyst, who claimed she earned significantly less than male colleagues in the same position, despite comparable experience. The suit expanded to represent approximately 9,000 female employees across various Disney divisions, including film production, theme parks, and record labels. Plaintiffs argued that Disney's compensation practices, including basing starting salaries on prior pay, perpetuated existing gender-based disparities.
Disney, while not admitting fault, consistently disputed the allegations. The company's defense centered on the argument that the vast diversity of roles within its numerous segments made it impossible to accurately compare skill and experience levels, contending that jobs were "completely different" and thus not "substantially similar." This stance underscores the point raised in a recent social media post by "wanye," who stated, "This isn’t even accurate given the stated claims of the lawsuit. The fact that the jobs were different is critical to understanding why the gender differences existed in the first place."
The Equal Pay Act (EPA) requires equal pay for equal work, where jobs need not be identical but must be "substantially equal" in skill, effort, and responsibility. Disney's argument reflects a common defense in such cases, emphasizing that job content, not just titles, determines substantial equality. A labor economist commissioned by the plaintiffs found that women at Disney earned, on average, 2.01 percent less than men in comparable roles, even after controlling for non-discriminatory factors.
Beyond the financial payout, the settlement mandates Disney to implement new measures aimed at addressing pay disparities. For the next three years, the company will retain an independent labor economist to analyze pay equity among full-time, non-union employees below the vice president level. Additionally, an industrial and organizational psychologist will provide training to compensation personnel involved in structuring positions within Disney's job architecture. This resolution highlights ongoing scrutiny on corporate pay practices and the evolving legal landscape surrounding gender pay equity.