Cyrus Mehri served as co-lead counsel in a suit against The Coca-Cola Company representing four named plaintiffs and a class of 2,200 current and former salaried African-American employees. The suit alleged that Coca-Cola employed racially discriminatory business practices that limited the professional advancement of African-American employees.
Among a long list of allegedly inequitable business practices, the plaintiffs alleged a substantial difference in pay between African-American and white employees; a “glass ceiling” that kept African-Americans from advancing past entry-level management positions; “glass walls” that channeled African-Americans to management in areas like human resources and away from power centers such as marketing and finance; and that senior management had knowledge of these inequities since 1995 and failed to implement policies to remedy them.
The parties reached a settlement in this case which was officially approved by the court in June, 2001. The $192 million settlement was the largest race employment discrimination class action settlement in the nation’s history. In addition to the monetary relief the settlement provided the settlement demanded that Coca-Cola become a leader among Fortune 500 companies in equitable employment practices. A court appointed Task Force, chaired by former Clinton Labor Secretary Alexis Herman, was given the mandate and authority to monitor changes to Coca-Cola’s practices to ensure that this diversity objective was achieved. The work of M&S received plaudits from the presiding Judge Story who remarked that “as a judge, there’s no greater pleasure than the opportunity to be involved in litigation with quality, professional class counsel.”
The settlement mandated that Coca-Cola overhaul its performance evaluation procedures, on the advice of industrial psychologists, improving on the largely subjective process that previously existed. Additionally these annual performance reviews now contain an explicit right to appeal for anyone who believes their review was unfair or inaccurate.
Coke agreed to implement changes to the manner in which staffing and promotion decisions are made, broadly publicizing openings to ensure that all interested candidates become aware of opportunities. Coca-Cola also agreed to ensure that a slate of candidates for any upper level position will include female and racial minority candidates for consideration, with the company retaining the right to actually promote whoever they deem most qualified after considering a broader range of applicants.
The settlement also empowered a Task Force with broad authority to supervise progress and suggest changes to company hiring, employee evaluation and promotions practices. The recommendations of the Task Force were significant and Coca-Cola was mandated to follow them or to obtain a court injunction releasing them of this duty.
The Task Force was responsible for generating yearly reports assessing the progress made by Coca-Cola in attaining a more equitable work environment for racial minorities. The Task Force has released five of these annual reports, the last one being in 2006, and has been disbanded.
The monetary settlement in this case was in the amount of $192 million. The majority of this money went to repay employees for lost earnings and to pay for compensatory damages, all non-wage-related damages. Damages to any individual class member were capped at either $150,000 or three times the individual’s salary as of December 31, 1999.
Additional money was paid to the class representatives who brought the case to compensate them for their efforts.