In a significant development, Activision Blizzard, now under Microsoft’s umbrella, has agreed to settle a discrimination case filed by the California Department of Civil Rights. The case, accusing the video game publisher of discriminating against women by denying promotion opportunities and providing lower pay, is set to be resolved through a proposed settlement agreement. Activision Blizzard has agreed to pay approximately $55 million, with the majority allocated to a fund for affected women between October 2015 and December 2020.
Background of Discrimination Allegations: This settlement follows a series of discrimination allegations against Activision Blizzard, including sexual harassment and retaliation, leading to a previous settlement with the U.S. Equal Employment Opportunity Commission in 2020. The recent case by the California Department of Civil Rights added further weight to the accusations, sparking legal actions and impacting the company’s standing.
Financial Implications and Legal Process: Of the $55 million settlement, around $46 million will contribute to a fund benefiting the affected women, covering both employees and contractors. The settlement proposal requires approval from the Los Angeles County Superior Court. Notably, the new complaint filed as part of the settlement will exclude previous harassment allegations, aiming to address discrimination issues.
Impact on Activision Blizzard and Microsoft Deal: These legal challenges come against the backdrop of Microsoft’s $69 billion acquisition of Activision Blizzard, which concluded in October. The Federal Trade Commission (FTC) has contested the deal, arguing that a federal judge erred in rejecting the regulatory agency’s attempt to block the transaction. The settlement could have implications on how both companies navigate regulatory scrutiny.
Conditions and Ongoing Responsibilities: As part of the settlement agreement, Activision Blizzard commits to ongoing efforts to enhance diversity by including underrepresented individuals in hiring processes. Additionally, the company is required to inform job applicants about their negotiation rights related to compensation at the beginning of hiring and promotion processes.
Closing Statements: Activision Blizzard CEO Bobby Kotick, who faced scrutiny during the legal battles, has not provided an immediate comment on the settlement. The resolution of this case marks a crucial step for the company and Microsoft as they navigate legal challenges and work towards fostering a more inclusive and equitable workplace environment
Activision Blizzard CEO Bobby Kotick speaks at the CNBC Evolve conference in Los Angeles on Nov. 19.
Jesse Grant cnbc
MicrosoftActivision-owned Blizzard has agreed to settle a case from a California state agency that accused the video game publisher of discriminating against women, including denying them promotion opportunities and paying them less. Is.
The California Department of Civil Rights said in a statement Friday that as part of the proposed settlement agreement, Activision Blizzard will pay approximately $55 million to provide relief and cover legal fees to female employees and contractors from October 2015 to December 2020. Will pay. Of the total amount, about $46 million will go to a fund for the affected women, the agency said in the statement.
The news comes nearly two years after Activision Blizzard settled a case with the U.S. Equal Employment Opportunity Commission that pointed to sexual harassment, pregnancy discrimination and retaliation. As a result, the company agreed to create an $18 million fund to pay victims.
In 2021, the agency, then known as the Department of Fair Employment and Housing, filed a lawsuit against the company, alleging sexual harassment, discrimination and retaliation. Months later, The Wall Street Journal reported that Activision Blizzard CEO Bobby Kotick was aware of allegations of misconduct inside the company, but did not share all relevant information with its board.
Shares declined and Microsoft subsequently entered talks to acquire Activision Blizzard. The $69 billion deal closed in October after it was carefully considered by regulators in the US and Europe. The Federal Trade Commission argued in a San Francisco appellate court last week that a federal judge erred in rejecting the regulatory agency’s effort to block the companies from completing the transaction.
According to the statement, the Los Angeles County Superior Court must approve Activision’s agreement with the state agency. According to the proposed settlement agreement, seen by CNBC, the agency will file a new complaint that will not include the prior harassment allegations.
The agreement will require Activision to continue efforts to include underrepresented people in hiring. Except when compensation is not negotiable, the company must tell job applicants in writing at the beginning of the hiring and promotion processes that they can negotiate their salary.
The maker of the Call of Duty games did not immediately comment.
Watch: Activision Blizzard CEO Bobby Kotick: We were always confident the deal would get done
