Accounting Giant KPMG LLP Faces $350 Million Gender Discrimination Class Action

Posted June 2nd, 2011.

Accounting Giant KPMG LLP

Faces $350 Million Gender Discrimination Class Action

Class of Female Managers Seeks Damages, Changes in Pay & Promotion Policies

For more information, contact Jamie Moss, newsPRos,201-493-1027,201-493-1027, [email protected]; or Jaime Baum, newsPRos, 201-493-1027, [email protected]

(June 2, 2011, New York, NY) – Although KPMG LLP – one of the “Big Four” accounting firms – publicly touts its commitment to diversity and equal opportunity, the numbers tell a different story entirely.  Women comprise about half of KPMG’s employees, but are conspicuously absent from the top leadership positions.  The Company’s 20-member global executive team and 24-member global board each have only one female representative.  Similarly, women are only 18% of all KPMG Partners compared to nearly 50% of all employees.

Aiming to put an end to the systemic gender discrimination at KPMG, a former female Senior Manager filed a $350 million class action discrimination lawsuit against the company today in the U.S. District Court for the Southern District of New York.  The Plaintiff, Donna Kassman, lives in New York and worked in KPMG’s New York office for seventeen years before resigning as a result of gender discrimination.  Plaintiff Kassman and the class are represented by Janette Wipper, Siham Nurhussein, and Deepika Bains of Sanford Wittels & Heisler, LLP.

KPMG is an audit, tax, and advisory services firm headquartered in Netherlands with U.S. offices headquartered in New York City.  In 2010, KPMG reported global revenues of $20.63 billion.

Plaintiff Kassman alleges that KPMG engages in systemic discrimination against its female Managers, including but not limited to Managers, Senior Managers and Managing Directors.  The lawsuit is intended to change KPMG’s discriminatory pay and promotion policies and practices, as well as its systemic failure to properly investigate and resolve complaints of discrimination and harassment.  The Plaintiff is filing this action on behalf of a class of thousands of current and former female employees who have worked as Managers at KPMG from 2008 through the date of judgment.

KPMG promotes fewer women to Partner (18%) than the industry average (23%) and fewer women to Senior Manager (35%) than the industry average (44%). “Across the accounting industry, women are conspicuously absent from leadership positions; but at KPMG, women fare even worse,” said Janette Wipper. “As soon as women come within reach of partnership, the Company’s male-dominated owners find ways to block their advancement,”

Despite Plaintiff Kassman’s long tenure and stellar performance, KPMG refused to promote her along the partnership track.  Ms. Kassman’s supervisors repeatedly told her throughout 2008 and 2009 that she was next in line for a promotion to Managing Director.  Around the time Ms. Kassman was to be promoted, however, two male employees complained that she was “unapproachable” and “too direct,” thinly-veiled gender-based criticisms designed to derail her career advancement.  Based on these unfounded, discriminatory comments, KPMG removed Ms. Kassman from the promotion track, subjected her to numerous hostile interrogations, and advised her to meet with a “coach” to work on her supposed issues.  Instead of disciplining the two male employees for their campaign of harassment, KPMG rewarded them by putting them up for promotion.

KPMG’s female Managers are not only under-promoted, but underpaid as well.  In one particularly egregious act of discrimination, KPMG slashed Ms. Kassman’s base salary by $20,000 while she was on maternity leave because she was paid “too much.”  KPMG cited no business justification for slashing her salary.  When Ms. Kassman complained about the salary cut, her male supervisor asserted that she did not need the money because she “ha[d] a nice engagement ring.”

“Unfortunately, Ms. Kassman’s story is completely representative of the treatment of women at KPMG,” Siham Nurhussein said.  “Ms. Kassman repeatedly complained up the chain of command about the gender discrimination and harassment she was experiencing, and the Company reacted with neither surprise nor concern.  Her supervising Partner told her matter-of-factly that her male colleague might have a problem working with women, and the Office of Ethics and Compliance told Ms. Kassman that men had ganged up on women at KPMG before.  KPMG not only tolerates gender discrimination, but displays an active interest in perpetuating it.”

In addition to the systematic discrimination faced by female Managers at KPMG, female employees with children also face discrimination based on their status as caregivers and/or being pregnant. After she gave birth to her first child, Ms. Kassman’s career advancement at KPMG came to a screeching halt. Without any warning or provocation, KPMG abruptly cut her salary while she was on maternity leave and placed her on a Performance Improvement Plan upon her return to work.  Ms. Kassman felt that she had no choice but to move to a “flexible” schedule, under which she retained all the responsibilities of a full-time employee, but was paid less.  KPMG frequently touted Ms. Kassman as a role model for other working mothers, even though one of the Partners acknowledged that women on flexible schedules were “not going to get anywhere [at KPMG].”

Ms. Kassman resigned from KPMG in October 2010 because the relentless gender discrimination and harassment had become unbearable, and it was clear that the Company had no interest in remedying the situation.

“As one of the ‘Big Four,’ KPMG helps set the industry standard and pervasive discrimination against women should not be any company’s standard ” said Deepika Bains. “Our hope is that as a result of this lawsuit, women will be able to join KPMG with greater opportunity for success.”

Ms. Kassman is seeking declaratory and injunctive relief for herself and the class, including back pay and front pay; compensatory, nominal, and punitive damages; and attorneys’ fees, costs, and expenses.

About SWH

Sanford Wittels & Heisler, LLP (SWH) is a law firm with offices in Washington, DC, New York, and San Francisco that specializes in employment discrimination, wage and hour, consumer and complex corporate class action litigation and has represented thousands of individuals in some of the major class action cases in the United States. The firm also represents individual clients in employment, employment discrimination, sexual harassment, whistleblower, public accommodations, commercial, medical malpractice, and personal injury matters.