Google Settles Racial Bias Lawsuit with $28 Million Payout

• Google has agreed to make a $28 million (£21.5 million) payment as they settle a lawsuit, charging that white and Asian staff had been paid more than employees of other ethnic backgrounds.
• Tech behemoths, including Google, are winding down the diversity, equity, and inclusion (DEI) activities in response to growing political pressures.

To settle a class-action lawsuit that accused Google of showing racial bias, the company has agreed to settle for $28 million (£21.5 million). Current and former Google employees, who are a part of the class from 15 February 2018 to 31 December 2024, are set to benefit from the agreement. The judgement of Judge Charles Adams from the Santa Clara County Superior Court in California, allowing for an advance payment of such funds, does not force the claims but does advise the two parties to confer to conclude the classification and settlement negotiation.

Racial Pay Disparity Allegations Spark Class-Action Lawsuit

The lawsuit cited Google’s hiring practices along with pay disparities between racial and ethnic groups. Cantu’s counsel cited an internal document leaked by Google employees showing that ethnic minorities were receiving less pay when performing similar work to their white and Asian counterparts.

According to these allegations, Google was promoting discrimination by utilising their practices of offering job levels and starting salaries based on prior pay, actions that the particular under-represented ethnic groups were inadequately affected by.

Cathy Coble, who is representing the claimants, extended her admiration to all those workers who were brave enough to speak out.

“The bravery of both the diverse and ally Googlers who self-reported their pay and leaked that data to the media has been instrumental in shedding light on systemic pay inequities,” Ms Coble said.

Not individual employee actions will help expose pay disparity that will otherwise remain hidden, she underlines.

Google Denies Allegations but Agrees to Settle

Nevertheless, Google insists the claims of discriminatory practices are unfounded but agreed to a multimillion-dollar settlement. Google made it clear that the settlement was being entered into with the sole goal of avoiding ongoing legal fees, enabling the business to concentrate on other matters, and did not admit wrongdoing.

DEI Backlash in Corporate America

The settlement comes as many large American corporations, including Meta (formerly Facebook), Amazon, Pepsi, McDonald’s, and Walmart, have ditched or cut back on their diversity, equity, and inclusion (DEI) initiatives.

Before this, Google had also made the claim to cutting back on its commitment to DEI initiatives due to the political and legal pressures caused by tracking billing errors.

US President Donald Trump and his allies have been especially critical of DEI policies, which they say are divisive. Since his return to the White House, Trump has directed federal agencies and contractors to phase out DEI programs based on his opinion that they unfairly advantage one group over others.

Settlement Implications over Tech Industry Practices

Google Inc. is to pay $28 million to settle the suit, alleging pay discrepancies in Silicon Valley and wherever else. Today, awareness looms over racial and corporate justice and pay equity, especially in the technology industry, owing to a long-standing address to diversification in top posts.

There is no suggestion of guilt in this settlement, but it may trigger a praxis change according to transparency and pay equity practices among tech-recruiting companies.