Kaiser Permanente agreed to pay $18.9 million to settle two class actions alleging the integrated health system underpaid and underpromoted Black and Latino employees.
In one settlement announced Thursday, $11.5 million will be distributed to approximately 2,225 Black employees who work in administrative support and consulting services within Kaiser. A separate settlement will pay approximately 2,500 Latino employees $7.4 million for similar allegations.
The Oakland, Calif.-based provider will also create programs to ensure fair and equitable pay and career advancement for its employees, according to the plaintiffs' attorneys.
Within the next year, Kaiser will complete a job analysis review to create career opportunities for Black employees. It will also conduct annual pay analyses for employees.
The settlement also requires Kaiser to name an internal compliance officer to oversee the settlement programs and meet with the plaintiffs' attorneys for three years.
Kaiser's senior vice president and chief human resources officer Christian Meisner said the company was holding itself accountable and committed to creating a more inclusive culture.
"Across Kaiser Permanente we are increasing our efforts to advocate for fair and just treatment, opportunity, and advancement as well as embedding accountability for equity at all levels of the organization," Meisner said in a statement. "We will continue to promote positive change, equity, and total health for all — inside our organization and within our communities."
The law firm for the Latino plantiffs, Bryan Schwartz Law and Nichols Kaster said their settlement stemmed from more than six months of negotiations.
"With this settlement, our clients are giving real-world meaning to the promise of the California Equal Pay Act and sparking action to address racial wage gaps. Kaiser Permanente is not only providing relief for the wages we believe Black employees should have been paid in the past, but also ensuring meaningful pay equity for the future," Kevin Love Hubbard, attorney at Medina Orthwein representing the Black plaintiffs, said in a statement.
In 2018, minorities comprised 43% of Kaiser Permanente's board and a quarter of its C-suite. Kaiser reported that 27% of its senior executives were ethnic or racial minorities in 2020.
In 2017, nearly 65% of Kaiser's total workforce were racial, ethnic and cultural minorities, and nearly 75% were women. The system focused on recruiting diverse students and faculty for its school of medicine.
The settlement is subject to court approval.
