Snap to pay $15 million in discrimination and harassment settlement

People pass by the New York Stock Exchange after the banner for the Snap Inc. IPO was raised on the building's facade, Wednesday, March 1, 2017. Snap Inc. is expected to start trading on the New York Stock Exchange on Thursday under the symbol "SNAP." (AP Photo/Richard Drew)
People pass by the New York Stock Exchange with a banner for Snap Inc. on its facade in 2017. The Santa Monica company has agreed to pay $15 million to resolve allegations of sexual harassment, discrimination and retaliation. (Richard Drew / Associated Press)

Snap Inc. and California’s Civil Rights Department have reached a $15-million settlement to resolve allegations of sexual harassment, discrimination and retaliation at the Santa Monica-based company.

The settlement brings to a close a more-than-three-year investigation into allegations of employment discrimination, equal pay violations, and sexual harassment. Nearly all the money from the agreement will go toward current and former female employees who worked at the company in 2014 and later.

Snap denies the allegations but said it agreed to settle to avoid a prolonged legal fight.

“We care deeply about our commitment to maintain a fair and inclusive environment at Snap, and do not believe we have any ongoing systemic pay equity, discrimination, harassment, or retaliation issues against women,” Snap spokesperson Russ Caditz-Peck said in an emailed statement.

Snap, which created the popular social media and messaging app Snapchat, grew quickly after its founding in 2011, with its workforce ballooning from 250 in 2015 to over 5,000 in 2022. During that period, women were discouraged from applying for promotions and were subject to unwelcome sexual advances and other harassment, the Civil Rights Department alleged in legal filings.

"This settlement with Snapchat demonstrates a shared commitment to a California where all workers have a fair chance," Kevin Kish, director of California's Civil Rights Department, said in a Wednesday news release. "Women are entitled to equality in every job, in every workplace, and in every industry.”

The case against Snap compiled by the Civil Rights Department portrayed a toxic office culture dominated by men. When women filed complaints internally about harassment, they allegedly were denied promotions, given negative performance reviews or were fired. Male managers, meanwhile, routinely promoted male employees over more qualified women, according to the civil rights complaint.

Women at the company were generally paid less than their male counterparts, the complaint alleged. In particular, women in engineering roles, which account for about 70% of Snap’s workforce, faced barriers and struggled to advance beyond entry-level positions.

"Women were told, both implicitly and explicitly, that they were second-class citizens at Snap," the complaint reads.

Caditz-Peck, the Snap spokesperson, said the company “disagreed with the California Civil Rights Department’s claims and analyses," but "took into consideration the cost and impact of lengthy litigation ... and decided it is in the best interest of the company to resolve these claims and focus on the future."

"For several years now we have successfully implemented tools and governance to achieve pay equity, and we will keep investing in and implementing policies to ensure team members continue to be valued and paid equitably for their work," he said.

As part of the settlement, Snapchat agreed to hire an independent consultant to examine and make recommendations on the company's pay and promotion policies, as well as workplace training.

The company will also be required to hire an outside monitor to audit Snapchat's handling of sexual harassment and discrimination complaints and share its findings with the Civil Rights Department.

The company also agreed to give information to all employees about their right to report harassment or discrimination without fear of retaliation and ensure they complete training on preventing these workplace issues.

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This story originally appeared in Los Angeles Times.