900 Join Suit Against Brokerage

Taking the latest stand against bias on Wall Street, more than 900 current and former female employees at Merrill Lynch & Co. have filed discrimination complaints as part of a class-action settlement.

The number of claimants joining the suit settled last June is three to four times what had been expected, plaintiffs' lawyers said on the eve of Monday's deadline to file a claim.

The case is closely watched, coming on the heels of an infamous discrimination case settled last year involving Smith Barney. The settlement is also helping change the way discrimination cases are handled on Wall Street.

Until recently, nearly all cases were handled through industry arbitration, a system criticized as biased in favor of companies. Under the settlement, Merrill Lynch became the first Wall Street firm to end mandatory arbitration for civil rights claims.

"Now there's accountability and liability," said Linda Friedman, a partner in the Chicago law firm Stowell & Friedman, which is handling the Merrill Lynch case. "Our hope is that this will change the balance of power."

The firm also represented the plaintiffs in the Smith Barney suit, which grew out of allegations of sexual hijinks and pranks in a so-called "boom room" at the brokerage's Garden City, N.Y. office.

To some observers, the cases uncover common problems for women on Wall Street. "It's one of the last bastions of discriminatory treatment and unequal standards in the country," said Laurel Bellows, former head of the American Bar Association's Commission on Women. "The rest of corporate America seems to have figured out that they benefit from qualified, intelligent women."

For the Merrill Lynch case, originally filed on behalf of eight plaintiffs, anyone complaining of discrimination will have their claim handled by a court-supervised mediator. If necessary, the complaint will go to binding arbitration. Financial consultants who worked at Merrill Lynch from January 1994 through June 1998 are eligible for redress.

There is no maximum or minimum amount of money available to the plaintiffs, but the first plaintiff, Marybeth Cremin, said Monday that given the high earning power of the women, millions of dollars could be involved. In addition to possible future awards, the eight original plaintiffs will share a $600,000 payment for being the first to come forward.

Most complaints in the case involve economic discrimination, the funneling of tips, clients and business to male brokers, the plaintiffs' lawyers said.

Women were often paid lower salaries than less-qualified men, then told, "'Well, you have a husband,' or 'Men have a family to support,'" said Mary Stowell, who is also representing the plaintiffs.

"It was a systemic problem," said Cremin, who worked at Merrill Lynch for 13 years. "The accounts and assets were for a large part going to male brokers."

Merrll Lynch spokesman Bill Halldin said the company had "not found any evidence of systemic discrimination" against any employees.

"We take all complaints from employees very seriously because we have no tolerance for discrimination of any kind," he said.

He said that the company did away with mandatory arbitration because "there was a perception of unfairness in arbitration and we're committed to making our workplace an excellent one and we thought this was an important step."

Civil rights and employee groups have been pressuring the industry to do away with mandatory arbitration for years, and in the last year, regulatory organizations began joining Merrill Lynch in moving away from the system.

Beginning Jan. 1, the National Association of Security Dealers ended its requirement for arbitration in discrimination cases. Individual securities firms can still impose the mandate on their own.

Women's rights advocates applaud the legal developments, which threaten firms with public exposure and payouts if they allow discrimination.

"Litigation is frequently the first wave of change," observed Sheila Wellington, head of Catalyst, a group that works to advance women in business and is currently studying women on Wall Street. "We will be watching, and others will too."

Written By MAGGIE JACKSON, AP Business Writer