think outside the stack —

Ex-Microsoft engineer sues, says company’s 1-5 ranking system was bad for women

Proposed class action suit says less qualified men were promoted over women.


Microsoft is the latest tech company to face allegations of gender discrimination. A former engineer named Katherine Moussouris filed a proposed class-action lawsuit in Seattle federal court yesterday, saying the company has a "pattern and practice of sex discrimination against female employees in technical and engineering roles."

In her complaint (PDF), Moussouris says Microsoft's "stack ranking" system, used until 2013, "force ranks" employees on a 1 to 5 scale, with 20 percent of employees allowed to receive a 1 (the best ranking), 20 percent ranked a 2, 40 percent a 3, 13 percent a 4, and the remaining 7 percent ranked a 5.

"This stack ranking process systematically undervalued female technical employees compared to similarly situated male employees because, among other reasons, it meant that lower ranked employees were inferior and should be paid less and promoted less frequently regardless of their actual contributions to Microsoft," Moussouris' lawyers write in the complaint.

That ranking system was replaced in 2014. The complaint doesn't go into detail about the new system but describes it as a "similarly unvalidated, and unreliable discriminatory performance evaluation procedure that systematically undervalues female technical employees."

Moussouris worked at the company from 2007 until 2014. She says that in 2012, her manager told her she had "outstanding performance" and ranked her a 2, but after the forced ranking process she ended up ranked a 3. In 2013, she was told she deserved a 1, but then ended up with a 2.

She also says she was consistently paid less than her male peers, and they were promoted over her.

"Microsoft's policies had an adverse impact on women, and Microsoft did not correct known issues," said Kelly Dermody, a Lieff Cabraser Heimann & Bernstein partner who is representing Moussouris, in an interview with The Recorder.

The suit seeks back pay, reinstatement for class members to their "rightful positions," and "an order requiring Microsoft to develop and institute accurate and validated standards for evaluating performance."

"We’re committed to a diverse workforce, and to a workplace where all employees have the chance to succeed," a Microsoft spokesperson told Ars via e-mail. She said Moussouris' allegations had been reviewed in the past and the company didn't find anything to substantiate them. "We will carefully review this new complaint."

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