OAKLAND, Calif. (CN) – Ride-hail giant Uber has agreed to pay $10 million and roll out a series of workplace reforms to settle claims it systematically underpays female and racial minority software engineers.
Former software engineer Roxana del Toro Lopez sued Uber in October 2017, claiming the company's "stack ranking" system allowed supervisors to rank employees from best to worst with no valid or reliable performance measures.
"In this system, female employees are systematically undervalued compared to their male peers because female employees receive, on average, lower rankings despite equal or better performance," del Toro Lopez said in her initial 12-page complaint.
On Monday night, del Toro Lopez filed an amended complaint, claiming employees of color were also undervalued compared to their white and Asian counterparts.
Uber simultaneously agreed to pay $10 million to approximately 420 women and people of color who worked as software engineers from July 31, 2013. The preliminary deal must be approved by U.S. District Judge Yvonne Gonzalez Rogers in Oakland.
The $10 million includes $80,000 in awards for del Toro Lopez and another named plaintiff, $170,000 in plaintiffs' attorneys' costs, and up to a 30 percent award for class attorneys' fees. It also includes $110,000 in settlement administration costs and a $50,000 allocation, 75 percent of which will go to California's labor watchdog pursuant to the California Private Attorney General's Act.
Under the deal, Uber will also require diversity and bias training for managers, develop performance standards for each job position, create a standardized performance review process, monitor salaries and promotions for impacts on race and gender, and provide mentoring services to female and racial-minority workers.
“This settlement involves claims dating back to July 2013 and, while we are continually improving as a company, we have proactively made a lot of changes since then," Uber said in a statement. "In the past year alone we have implemented a new salary and equity structure based on the market, overhauled our performance review process, published our first diversity & inclusion report and created and delivered diversity and leadership trainings to thousands of employees globally.”
Class attorney Rachel Dempsey of Outten Golden in San Francisco did not immediately return a phone call seeking comment Tuesday morning.
The settlement comes just more than a year after a female software engineer wrote a blog post about what she said was Uber's failure to discipline a manager who sexually harassed her, leading other female workers to come forward about an allegedly toxic workplace culture for women at Uber.
The company hired former U.S. Attorney General Eric Holder to investigate Uber's corporate culture. In July 2017, Holder proposed a series of sweeping changes to the company's leadership, organization, management, handling of complaints, and pay practices.
That was one of a series of scandals that forced Uber founder Travis Kalanick to step down as CEO in June 2017.
Dara Khosrowshahi, former top executive at the online travel booking company Expedia, took over as Uber CEO in September last year.
Earlier this year, Uber agreed to pay $245 million to settle claims that it stole self-driving car technology from Google-owned startup, Waymo.
The company continues to fight lawsuits over an October 2016 data breach that it hid from the public for over a year and another class action claiming it misled investors about its misogynist workplace culture and corporate misconduct.
A hearing on preliminary approval of the $10 million deal to settle race and gender bias claims is scheduled for May 1.
Read the Top 8
Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.