Employers, In Case You Were Wondering: Sexual Harassment and Discrimination Do Not Pay Off

Just ask Riot Games, which recently agreed to pay $10,000,000 to settle a class action lawsuit for alleged violations of the California Equal Pay Act, and gender discrimination, retaliation, and harassment. The settlement amount will be divided among approximately 1,000 women who had worked in the Los Angeles studio over the last five years, depending on each employee’s length of service.   

In a statement regarding the settlement, Riot indicated that:

While we believed that we had a strong position to litigate, we realized that in the long run, doing what is best for both Riot and Rioters was our ideal outcome. Therefore, rather than entrench ourselves and continue to litigate, we chose to pivot and try to take an approach that we believe best demonstrates our commitment to owning our past, and to healing the company so that we can move forward together.

Riot’s legal challenges (which included accusations of unfair treatment towards women and “bro” culture), led the studio to conduct an internal audit and implement corrective measures, such as engaging outside consultants on culture change, setting up a hotline for anonymous complaints, hiring a Chief Diversity Officer, “doubling down” on training, and more.

Although the settlement amount may not dramatically impact Riot, which reportedly made $1.4 billion in revenues in 2018, it serves as a warning of the costly implications of ignoring employee complaints and failing to educate your workforce about proper workplace conduct.

Follow Riot’s footsteps and conduct your own internal audits to confirm your policies and practices are in compliance with state and federal laws, that your workforce is properly trained (a requirement for all California employers with five or more employees), and that managers understand their managerial duties.

Tal Burnovski Yeyni is an employment defense attorney.