Mastercard agrees to settle pay discrimination lawsuit for $26 million

Mastercard must pay $26 million to settle allegations that the company underpaid thousands of women, blacks and Hispanics for years under a settlement filed in court on Tuesday.

The settlement, if approved by the U.S. District Court for the Southern District of New York, will resolve Mastercard’s underpayment claims of approximately 7,500 employees nationwide dating back to 2016. The company, which admitted no wrongdoing, also agreed to conduct annual paid equity audits for three years and hire a psychologist to assess bias in its workplace.

According to the proposed class action complaint, also filed Tuesday, female, black and Hispanic workers were paid less than their male and white counterparts for doing the same or similar work. Mastercard, the second-largest payment processing company, has repeatedly improperly appointed women and people of color to positions below their experience, contributing to the pay gap, the complaint says.

“We think this is a good decision for clients, and we think it sets the stage for other companies in the industry to improve their pay equity practices,” said Cara Green, a partner at the law firm Outten & Golden, which is representing the interests. plaintiffs in the case.

Ms. Green called the deal a “fair compromise” that reflects the demands of thousands of women and people of color who have worked at Mastercard. She refused to provide specific figures for wage discrepancies.

Mastercard spokesman Seth Eisen said the company “vigorously” denies the allegations in the lawsuit and that by settling the case, Mastercard is “committed to continuing to support and provide services to our employees.”

He added: “It is in the best interest of all involved to close this case.”

Other large companies, including those in the financial services industry, have settled pay discrimination lawsuits in recent years, in some cases paying significantly larger sums. In 2023, Goldman Sachs agreed to pay $215 million settle a gender bias lawsuit who accused the bank of hindering women’s career advancement and paying them less than their male counterparts. In 2022, Google agreed to pay $118 million settle a class action who accused him of systematically underpaying women.