Late last month, American lawyer Ellen Pao lost a historic gender discrimination lawsuit against her former employer, the venture capital firm Kleiner Perkins Caufield & Byers LLC. A 24-day trial, the case received an intense amount of media coverage, focusing on the status of women in the technology industry. While the California state court ruled in favor of Kleiner on all gender discrimination claims, the referendum has illustrated the need to strongly consider the challenges women have faced in the worlds of technology and business. Despite the undesirable outcome, Pao’s case does not preclude future gender discrimination lawsuits; rather, it opens the door to high-profile conversation on subtle sexism.
Ellen Pao, a junior partner at Kleiner, sued her former employer alleging workplace retaliation by a male junior partner as consequence of a personal relationship. She argued that she was excluded from important email chains and other company conversations. She continued to work at the firm and then was fired — an action her lawyer argued was in response to her lawsuit.
The defense provided evidence indicating otherwise. For example, Pao made more money than her male junior partners when she left. Pao also had inconsistent performance reviews. While it’s possible that Kleiner could have systematically marginalized female employees, the court ruled that the performance records of other female employees were not permissible. Therefore, no case could be made that the reviews were sexist. Ultimately, the defense was able to project enough doubt in her trustworthiness to lead jurors to reject the discrimination claims.
Regardless of the outcome, Pao’s case will neither significantly discourage hiring of women nor deter future lawsuits. Kleiner received a lot of bad press with the case simply on the allegation that it discriminated; venture capital (VC) companies don’t want to risk similar PR nightmares. Moreover, weeks after Pao’s case, similar lawsuits were filed by former employees at Facebook and Twitter. With the amount of media attention brought to tech industry discrimination, the issue of gender discrimination in tech cannot be buried in the sand. Pao received an enormous amount of support from women who resonated with her story. In many ways, Ellen Pao’s case was a gateway to challenging the tech industry “boys’ club.”
In essence, Pao’s case lost on the basis of her story and character portrayed in court rather than the actual existence of discrimination. While the court did not rule that gender discrimination exists at Kleiner, it does exist in the industry, at least statistically speaking. In the VC industry, 94 percent of firm partners are male. Seventy-seven percent of all venture capital firms have never had a female partner. According to a Babson College 2014 study, although women are majority owners of 36 percent of all businesses, only 15 percent of VC companies have a female executive and only 2.7 percent of those companies have had a female CEO. There are enough qualified women — at least 36 percent of all business owners are women — VC companies just don’t hire them.
Silicon Valley is certainly biased against women in technology; the gender gap at VC firms reflects a common trend among U.S. tech companies. This male-dominated field effectively propagates a “boys’ club” by disproportionately investing in businesses led by men. If this pattern of implicit bias continues, women, if not now, could in the future be discouraged by the lack of representation and hostile work environments.
In contrast to the staggering bias against women in the VC industry, Harvard Business School researcher Paul Gompers testified that Kleiner has the best track record for hiring women of any major VC firms; 20 percent of Kleiner’s partners are female. While Pao’s case wasn’t the strongest story, other cases seem likely to win based on these statistics alone — especially for firms, in which hiring practices are less than favorable and environments less than accomodating.
Today’s sexism in the workplace is not overt, but subtle. Courts tend to rule quickly in favor of the defendant when the sexism is obvious, like harassment. However, what sexism exists now is harder to prove — how your boss’s description of you as aggressive renders you ill-fit for an administrative role or how female executives are denied promotion.
Pao faced discrimination because of her gender and race; she was expected to be submissive and demure, but complained loudly and consistently, even being described in her performance reviews as “territorial” and in need of “softening.” Unfortunately, her narrative did not win in the courts, but that doesn’t mean that other cases in the future will also meet the same fate. Increased, high-profile conversation about subtle sexism in the workplace will challenge male-dominated fields; it will encourage courts and society to reform the workplaces to better accommodate all genders.
Photo courtesy of USA Today