On March 30th, 2021, KPMG agreed to pay over $10 million to settle a long-running lawsuit filed by Lieff Cabraser and co-counsel on behalf of hundreds of female Advisory and Tax professionals at KPMG accusing the company of pay and gender discrimination.
Nine named plaintiffs filed a motion in New York federal court asking a judge to approve the agreement, which would resolve the case, filed as a hybrid class and collective action, that began in 2011. The plaintiffs claim they were underpaid and under-promoted to a statistically significant degree, citing common gender-based problems with KPMG’s pay and promotion policies and practices. They also described a culture at KPMG rife with gender discrimination, sexual harassment, and retaliation.
Background on the case
Lieff Cabraser and Sanford Heisler are Co-Lead Counsel for Plaintiffs in a gender discrimination class and collective action lawsuit against KPMG, the Big Four Accounting Firm with $26 billion in global revenue in 2017. The complaint alleges that KPMG has engaged in systemic and pervasive discrimination against its female Tax and Advisory professionals in violation of the Equal Pay Act, Title VII of the Civil Rights Act of 1964, and New York law. On July 8, 2014, Judge Schofield of the Southern District of New York granted conditional certification of the Equal Pay Act collective and ordered that notice be mailed to the affected women. Subsequently, approximately 1,100 women (current and former KPMG employees) joined to challenge KPMG’s unfair compensation.
On November 27, 2018, Plaintiffs filed a motion in U.S. District Court for the Southern District of New York seeking class certification in the long-running lawsuit challenging gender disparities in pay and promotion on behalf of approximately 10,000 female Advisory and Tax professionals. Plaintiffs also sought final certification of the Equal Pay Act collective on behalf of the approximately 1,100 opt-in plaintiffs. The motion and the reply detail how women were underpaid and under-promoted to a statistically significant degree, and the common problems with KPMG’s pay and promotion policies and practices. It also describes a culture rife with gender discrimination, sexual harassment, and retaliation. The Court held a hearing on the motion, not previously filed on the public docket, in August 2018.
On November 30, 2018, the Court declined to certify the class and decertified the Equal Pay Act collective. While the Court acknowledged KPMG’s common pay and promotion policies and its gender disparities in pay and promotion, the Court held that the women challenging KPMG’s pay and promotion policies cannot pursue their claims together. The case is not over, but plaintiffs who wish to pursue their individual claims must act quickly, because the applicable statute of limitations may be running.
Currently, Plaintiffs are considering next steps. On December 14, 2018, Plaintiffs filed a Petition to Appeal the Denial of Class Certification under Rule 23(f) with the United States Court of Appeals for the Second Circuit. Plaintiffs are awaiting a decision from the Court of Appeals about whether to hear the appeal.
Importantly, those who wish to pursue their individual claims must act quickly. Plaintiffs’ motion to toll the Equal Pay Act statute of limitations until March 30, 2019 was granted, which pauses the clock on the time that individual opt-in plaintiffs have to pursue their EPA claims. Time limits that the law imposes on members of the potential class, however, are once again running, meaning that members of the potential class hoping to pursue their claims must take individual steps to protect their claims or risk losing them. Please contact Plaintiffs’ Counsel if you have any questions.