Yahoo! Inc. made headlines earlier this week when it announced that it would not only be willing to entertain a sale of its core business going forward, but also that it would be terminating roughly 1,700 employees or nearly 15 percent of its workforce.
Unfortunately for the struggling Internet giant, this wasn’t the only time it made the news this week for the wrong reasons, as it was also hit with a $5 million lawsuit filed by a former employee alleging both manipulation of performance evaluation standards and gender discrimination.
The lawsuit was brought by a former online news editor who was laid off along with nearly 600 other employees in November 2014 for rating in the bottom 5 percent of Yahoo’s quarterly performance review system.
According to his complaint, which was filed in the U.S. District Court for the Northern District of California, employees were provided with little to no information concerning this quarterly performance review system, a calculated move that he argues enabled Yahoo! to ensure that its financial targets were met and surreptitiously ensure internal promotions would be go to female candidates.
“Employees did not know who was making the final decisions, what numbers were being assigned by whom along the way, or why those numbers were being changed,” reads the complaint. “This manipulation of the [quarterly performance review] process permitted employment decisions, including terminations, to be made on the basis of personal biases and stereotyping.”
In support of this argument, the former news editor points that out prior to his sudden termination he had been promoted, given a pay bump and otherwise commended for doing good work during his four-year tenure at Yahoo.
Interestingly, the lawsuit also accuses Yahoo! of violating state and federal laws that require employers planning mass layoffs to provide affected employees with advanced notice.
Specifically, while the law in California dictates a 60-day notice period if 50-plus employees will be terminated in a given month, the former editor claims that he was informed his termination took effect immediately.
Stay tuned for updates on this fascinating case …
If you have any questions regarding layoffs, reductions in force or unlawful firings, please contact a reputable law firm like Danz & Kronengold, P.L.