32
EXPERT REPORT OF WILLIAM T. BIELBY, Ph.D.
Martens et al. v. Smith Barney, Inc. et al.
July 12, 2000
QUALIFICATIONS, ASSIGNMENT, AND MATERIALS REVIEWED
I have been retained by the law firm of Stowell & Friedman, Ltd., class counsel for plaintiffs in Martens et al. v. Smith Barney, Inc. et al., to review materials pertaining to the firm's policies and practices that affected the careers of female employees during the period from May, 1993 through November, 1997. I have been asked to analyze whether features of those policies and procedures placed women at a disadvantage relative to men with regard to hiring, job assignment, promotion, compensation, and other career opportunities.
I have testified as an expert witness in both California Superior Court and Federal Court on cases involving workplace discrimination. A list of cases in which I have been identified as an expert or have given expert testimony can be found in my Curriculum Vitae, which is attached as Exhibit A.
I received a Ph.D. in Sociology from the University of Wisconsin--Madison in 1976. I also have a B.S. in Electrical Engineering and a M.A. in Social Sciences from the University of Illinois. I am currently Professor of Sociology at the University of California, Santa Barbara, where I chaired my department from 1992 to 1998. I am also affiliated with UCSB's Department of Statistics and Applied Probability. Among my former positions are Visiting Professor of Management at UCLA and Fellow at the Center for Advanced Study in the Behavioral Sciences at Stanford. I teach graduate and undergraduate courses on organizational behavior, research methods for the social sciences, labor markets, quantitative methods, and social inequality. I also specialize in research in each of these areas. Over the past fifteen years, much of my research has focused on issues of workplace discrimination, and on organizational policies and practices more generally. My research on these topics has been supported by four grants from the National Science Foundation, and it has been published in leading peer-reviewed social science research journals.
I have received national awards from three different professional associations for my research on gender, labor markets, social psychological aspects of work, and organizational personnel practices. I have served on numerous panels, advisory committees, and professional workshops on topics relating to workplace discrimination, organizational personnel policies and practices, and research methodology. I have served as an advisor, consultant, or reviewer for the following organizations and agencies: the U.S. Bureau of the Census, the U.S. Department of Justice, the U.S. Department of Labor, the National Science Foundation, the National Institute of Mental Health, the National Academy of Sciences, the University of Michigan's Institute for Social Research, Stanford University, and the Writers' Guild of America, West. I have also served on the editorial boards of leading social science journals, and I regularly review manuscripts for scientific journals on topics relating to organizational behavior, employment discrimination, gender and work, and research methodology. I have been elected to several offices in the American Sociological Association, and I currently serve on the ASA Council, the organization's governing body.
I have reviewed deposition testimony of Kevin McManus, John A. Adamiak, Scotland King, and Robert B. Means. Mr. McManus, Director of Private Client Administration within the Private Client Division (i.e., retail sales), is a senior executive responsible for administering the firm's compensation plan in his division and testified about national compensation policy in his division. Mr. Adamiak, Resident Branch Manager of the firm's Philadelphia office, testified on implementation of national policy at the branch level, branch managers' discretion in implementing personnel policy, and related matters of branch operations. Ms. King is Director of Resource Development, and she testified about the firm's policies and practices for hiring and training Financial Consultants, for hiring and promoting into management positions, and for implementing its diversity programs. Dr. Means, an industrial psychologist, is president of Occidental Consulting Group, Inc. He developed the "Oxicon" test used by Smith Barney (and other brokerage firms) to assess the psychological traits and personal backgrounds of individuals applying for the position of Financial Consultant. Dr. Means testified about the test he developed and how it is used in the selection of Financial Consultants.
Besides deposition exhibits, documents made available to me include: various employee handbooks, brochures, and newsletters; documents describing EEO and sexual harassment policies; documents describing compensation for Financial Consultants, Financial Consultant Associates, and Branch Managers; documents describing job postings; the Oxicon and SIA screening tests; internal communications and press coverage of firm representatives' statements about the Martens litigation, and the Stipulation of Settlement. I have also reviewed individual class members' complaints. Finally, in forming my opinions, I have also relied upon the expert reports of Dr. Jerry Goldman, Dr. Janice Madden, and Dr. Louise Fitzgerald.
SUMMARY OF FINDINGS
I have concluded that the Smith Barney workforce has been highly segregated by sex, with women largely excluded from the career paths with the best pay and prospects for advancement. Informal, arbitrary, and subjective personnel procedures, implemented in a climate that has been hostile and unsupportive toward women, have sustained both the overall pattern of sex segregation and disparities in compensation between male and female Financial Consultants. Prior to the settlement of the Martens litigation, the firm's policies pertaining to equal employment opportunity were deficient in almost every dimension and therefore were inadequate for minimizing gender bias. The basis for these conclusions is explained below.
WOMEN AND MEN AT SMITH BARNEY HAVE BEEN SEGREGATED INTO DIFFERENT JOBS AND SEPARATE CAREER PATHS
The Smith Barney workforce is highly segregated by sex. Statistics compiled by Dr. Goldman for 1995 show that women comprise the overwhelming majority of those employed in administrative support jobs, whereas men dominate jobs in sales and management. As of July 1, 1995, only four percent of the firm's workforce of approximately 20,000 was employed in jobs with relatively balanced gender ratios (with neither sex accounting for more than 75% of employment): Cold Caller (687 employees, 38% female); Control Administrator (61 employees 61% female); and Regional Administrative Manager (23 employees, 57% female). Approximately three-fourths of the firm's employees work in three highly segregated jobs: Sales Assistant (4,494 employees, 91% female); Financial Consultant (9,258 employees, 11% female); and Broker Trainee (1,312 employees, 11% female).
Social scientists measure the overall degree to which men and women are segregated into different job categories with a segregation index, also known as the "index of dissimilarity."[1] The segregation index ranges from 0 (when the ratio of men to women is the same in every job category) to 100 (when every job category contains only men or only women).[2] The index computed for detailed Census occupational categories for the entire U.S. labor force allows social scientists to assess the degree to which overall sex segregation in the labor market has declined. For example, from 1970 to the early 1990s, the segregation index for the entire U.S. workforce declined by 13 points (a 19% decrease), from 68 to 55.[3] In contrast, the segregation index for Smith Barney, computed across the 18 job groupings listed in Table 1 of Dr. Goldman's report, is 74.5. In other words, the Smith Barney labor force was more segregated in 1995 than was the entire U.S. workforce a quarter of a century earlier. In fact, the segregation index for Smith Barney in 1995 is almost identical to that for the U.S. workforce in 1960, when the index was 74.[4]
Compared to the jobs dominated by males, those in which most of the firm's women are employed have lower earnings and more limited opportunities for advancement. In effect, the firm has maintained two separate career paths, one for women and the other for men. Women work on the operations/administrative side of the firm, mostly in the job of Sales Assistant, which pays less than any of the predominately-male jobs except for cold caller. Few women advance beyond the position of Operations Manager, which pays considerably less than the male-dominated management job categories of Assistant Branch Manager, Sales manager, and Branch Manager, and the higher-level director jobs (Goldman report, Table 1).[5] Most men are employed in the highly-compensated job of Financial Consultant (where they outnumber women by a ratio of 9 to 1), which is the typical route to positions in higher-level management.[6] Movement in the management ranks from operations to sales is rare.[7]
While mobility from the operations side to the sales side was rare, some employees did make that transition. However, a "glass wall" existed at Smith Barney that made such job transitions substantially more difficult for women than for men. For example, Dr. Goldman's "core group" analysis shows that few women ever moved out of the Sales Assistant position. In contrast, it was not unusual for male Sales Assistants who remained with the firm to move into Financial Consultant positions (even though, according to Mr. Adamiak's testimony, that "would not be a normal career path").[8] Moreover, statistics compiled by Dr. Goldman show that women who did make it into the Financial Consultant position earn substantially less than their male counterparts. Earnings disparities by gender emerge early in the careers of Financial Consultants, and over the course of a career the compensation of men grows more rapidly than the compensation of women.
Men also appear to benefit from a "glass escalator" in advancing into management careers within the operations side.[9] In 1995, while men comprised just 21% of Assistant Operations Managers and 18% of Operations Managers, their representation was approximately twice as large (39%) among Regional Administrative Managers, the most highly compensated management job on the administrative side of the firm. In short, the statistics compiled by Dr. Goldman suggest that men are more likely to be promoted into and advance through the management ranks in both the male-dominated sales side of the firm and the female-dominated administrative side.
In sum, women pursuing careers at Smith Barney were disadvantaged relative to their male counter parts in two ways. First, segregated jobs and career paths limited women's access to jobs with the best career opportunities. Second, when men and women did work in the same jobs, men usually earned more and faced better prospects for advancement into higher level jobs. In the next sections I describe what social research shows about the factors that create and sustain barriers to women's career advancement and the policies and practices that minimize workplace bias. Then I assess whether factors that create bias were present at Smith Barney and the effectiveness of the firm's policies for minimizing bias.
four or five sentences on factors
FACTORS THAT CREATE AND MINIMIZE WORKPLACE GENDER BIAS: FINDINGS FROM SOCIAL SCIENCE RESEARCH
Sources of Workplace Gender Bias
Depending on the job, organizational setting, and work environment, there are many reasons why men and women can have different career trajectories. For example, jobs may have job-related skill and experience requirements that differ, on average, between men and women. Gender disparities arising from such factors would not be considered discriminatory, so long as the employer is not responsible for differences in men's and women's qualifications (e.g., by not providing equal access to training). Conversely, employers create gender barriers when they make decisions about individuals' suitability for jobs, training, and support or their compensation based on beliefs about a person's gender rather than on his or her actual qualifications. Employers also create gender barriers when they ignore (or encourage) an organizational climate that is hostile towards women and inhibits them from performing to their full potential. Sometimes, practices that appear to be gender-neutral have the effect of denying to women the same opportunities that are available to men. For example, using employee referrals as a recruitment mechanism is likely to reinforce a workforce's existing the existing gender composition.[10]
One way gender bias affects career outcomes is when stereotypes are allowed to affect personnel decisions. Gender stereotypes are beliefs about traits and behaviors that differ between men and women.[11] For example, men are believed to be competitive, aggressive, assertive, strong, and independent, while women are thought to be nurturing, cooperative, supportive, and understanding. Men are assumed to place a high priority on their careers, while women are assumed to be more strongly oriented towards family, even though research demonstrates that the commitments of men and women with similar job opportunities and family situations are virtually identical.[12] When women perform successfully in male-dominated contexts, their accomplishments are more likely to be attributed to luck, help from others, or special circumstances than to their ability, whereas comparable performance by men is more likely to be attributed to their superior skills.[13] Moreover, stereotypical behaviors that are believed to be typical of men are often viewed as inappropriate for women. For example, it is less acceptable for a married woman with young children to place a high priority on her career than it is for a married man. Similarly, a woman who behaves in an assertive and independent manner often elicits disapproval from those around her.[14]
Because of gender stereotypes, individuals tend to ascribe "masculine" traits to men and "feminine" traits to women, and individuals tend to assume that the prevalence of "masculine" traits among women and "feminine" traits among men is rare. People are often unaware of how stereotypes affect their perceptions and behavior, and individuals whose personal beliefs are relatively free of prejudice or bias are susceptible to stereotypes in the same ways as people who hold a personal animosity towards a social group.[15]
In the employment context, career barriers resulting from gender stereotypes are likely to be consequential for women working in a traditionally male domains, such as the middle to upper managerial and professional ranks of large corporations, engineering divisions of firms, in the military, and in historically male-dominated industries such as skilled crafts and construction trades.[16] A large body of social science research demonstrates that stereotypes are especially likely to influence personnel decisions when informal, arbitrary, and subjective factors influence personnel decisions.[17] In such settings, stereotypes can bias assessments of a woman's qualifications, contributions, and advancement potential, because perceptions are shaped by stereotypical beliefs about women generally, not by the actual skills and accomplishments of the person as an individual.[18]