A group of nearly four dozen female Merrill Lynch advisers are opposing a proposed $39 million settlement in response to gender bias accusations, saying that the brokerage firm's payout represents “a huge step backwards.”
The advisers' 25-page filing, which was filed in federal court on Friday, said that the settlement filed Sept. 9 was “meager” and “unfair,” and “will enshrine the very policy that the plaintiffs challenged in this lawsuit as discriminatory.”
At issue are two Merrill Lynch policies that the advisers say are discriminatory and will continue despite the settlement.
The first is a compensation policy that the advisers say is partly based on past performance and, as a result, favors men.
The second is a policy that the advisers said favors teams, which historically excluded women who were thought to be underperforming.
A complaint filed in October 2011 said that Merrill Lynch ranks high-producing advisers first on the distribution list to receive accounts, and that a greater number of accounts and more of the lucrative accounts are given to men.
“These additional accounts and business opportunities, as well as house account production credits, directly and indirectly increase the male [advisers'] production and place male [advisers] in an even better position for the next round of account distributions based on systematically documented and unvalidated criteria,” the complaint said.
The filing contends that the settlement on gender bias issues could erode the benefits of a larger $160 million settlement, McReynolds v. Merrill Lynch, for African American women. That settlement, which is also being considered in court, deals with allegations of racial bias against African-American brokers and trainees.
The objection, which was first reported on Monday afternoon by Law360, could influence the judge tasked with considering the settlement at a Dec. 19 hearing.
Merrill parent Bank of America Corp., which has hailed the settlement as enriching opportunities for women to advance as advisers, declined to comment through a spokesman, William P. Halldin.