Silicon Valley tech giants HP and Hewlett Packard Enterprise agree to pay $18 million over age-bias claims
Case so lengthy, lead plaintiff died
According to a court filing, HP and its spinoff Hewlett Packard Enterprises have agreed to pay $18 million to settle a class-action lawsuit accusing them of purging older workers after a seven-year legal battle.
According to a court motion for the plaintiffs, the lawsuit lasted so long that lead plaintiff Donna Forsyth, a manager laid off at the age of 62 after 17 years with the companies, did not live to see its resolution.
Claims in the case date back to 2012, before Hewlett-Packard, the legendary Palo Alto electronics firm, split into HP for hardware, such as computers and printers, and Hewlett Packard Enterprise for business software and services in 2015.
Three years prior to the split, the company “began implementing a company-wide initiative to replace thousands of existing, older workers with new, younger employees,” according to the lawsuit. According to the lawsuit, then-CEO Meg Whitman “repeatedly admitted that her goal was to make the entire organization younger.”
According to the lawsuit filed in U.S. District Court in San Jose, the alleged “workforce reduction plan” lasted at least until 2020. A court filing on Thursday revealed the settlement.
According to UC Davis computer science professor Norman Matloff, Silicon Valley continues to operate under an employment model described in the lawsuit as a “labor pyramid,” with the majority of workforces made up of young people. “No university computer science program warns its students about this scary but true fact about the industry,” Matloff stated.
Matloff believed the companies settled to avoid a trial that would have resulted in embarrassment and “a likely decision in favor of the plaintiffs.”
Hewlett Packard Enterprise did not respond to questions about industry practices or the settlement. HP did not respond to a comment request.
Google, the Mountain View digital advertising giant, agreed to pay $11 million in 2019 to settle a similar class-action lawsuit accusing it of failing to hire hundreds of older workers due to their age. In a 2015 lawsuit filed in U.S. District Court in San Jose, the workers claimed that the company denied equal hiring, employment, and compensation opportunities to people 40 and older as its workforce grew between 2007 and 2013. In a settlement with 227 plaintiffs, Google denied engaging in age discrimination but agreed to train managers and employees on age-based bias and to establish a committee in its recruiting department to focus on age diversity in software engineering, systems-reliability engineering, and systems engineering.
The $18 million award in the HP and Hewlett Packard Enterprise case will be shared by approximately 350 former and current employees. People in the group were terminated at the age of 40 or older, allegedly under the “reduction plan,” between 2012 and 2022. According to a court filing Thursday, each will receive approximately $50,000, minus legal and administrative fees and other costs.
The agreement must be approved by the court. A hearing on the subject is scheduled for late October.
