NEW YORK -- Morgan Stanley, the world's second-biggest securities firm, set up a $46 million claims pool to settle a sex discrimination lawsuit and said it will enact new policies to help women succeed as financial advisers.
The settlement, which must be approved by the US District Court in Washington, would change training and management development programs in Morgan Stanley's wealth management division, the New York-based firm said yesterday.
Six women who are former Morgan Stanley financial advisers filed the complaint last year, claiming the firm discriminated against them and more than 3,000 current and former advisers since August 2003. Morgan Stanley paid women less than men and gave them fewer promotion opportunities, the women claimed.
"We are firmly committed to the initiatives we will be undertaking to attract and retain women financial advisers and help them be as successful as possible," Caroline Gundeck, head of the wealth management's office of diversity, said.
The agreement will also increase earnings for female advisers by at least $16 million over five years, according the law firms representing the plaintiffs. Diversity programs by Morgan Stanley will cost an additional $7.5 million, the firms said.
The settlement is the ninth-largest in a US gender bias class-action case. The biggest, for $565 million including interest, was a 2000 settlement of a case brought against the US Information Agency and Voice of America by 1,100 employees of the agency.
In a separate sex bias case in 2004, Morgan Stanley agreed to pay $54 million to settle a suit brought by a former bond saleswoman, Allison Schieffelin, and the Equal Employment Opportunity Commission.