Novartis Sex-Discrimination Case: The Horrible Downside of Tolerating "Bad Apples"

Last Updated Apr 9, 2010 11:47 AM EDT

Novartis (NVS) appears to be trying to blame a few bad apples in the barrel for the $200 million sex discrimination trial filed by female drug reps and currently under way in a New York federal court. But Novartis' real problem is that by failing to fire its bad apples in a timely fashion, the entire company may now be liable.

One sales rep who complained to the human resources department when her manager showed her pornography on his computer was told that he could not be fired unless he physically threatened her, according to page 72 of the complaint. It took Novartis two years to fire district manager Brian Aiello after the lawsuit was filed. And that should be the lesson for managers everywhere: Doing nothing makes you liable, even if the behavior is restricted to a single office jerk.

The plaintiffs claim that female pharmaceutical sales reps got promoted less often and were encouraged not to get pregnant by their male managers. The class action case affects 5,600 female Novartis employees, who allegedly earn an average of $105 less per month than their male counterparts.

Aiello will likely become the plaintiffs' poster boy for bad behavior as the trial progresses. According to the New York Post, he:

showed pornography to his female subordinates, openly referred to women as "bitches and c---s" and said wives "were only good for washing, ironing and f-----g."
The AP noted that he allegedly invited female reps to sit in his lap. Still to come is testimony over Aiello's hiring practices. According to the complaint:
In January 2003, District Manager Aiello discussed a recently hired female sales representative and described her physical attributes as a factor which helped in her hiring for the job at Novartis.
... On one occasion, District Manager Aiello joked that Ms. Holland looked as though she were nine months pregnant, even though he knew that she was not pregnant.

Additionally, District Manager Aiello often bragged about terminating all of the minority employees on his sales team during his two years as the Area Sales Manager. Moreover, he openly discussed the reasons why he fired them, for example, commenting on their stupidity. After firing one African American female employee, District Manager Aiello told other sales representatives that the African American female employee was disgusting and black and that "her car was full of chicken bones."

District Manager Aiello also complained about receiving applications from "diversity" candidates and often refused to grant them interviews.

Novartis admits that it was slow to get rid of Aiello, but the company's lawyer seems not to "get it":
"He's gone. We're glad he's gone." [Novartis lawyer Richard] Schnadig added: "He wasn't that bad a manager. He was just terrible with women."
(One would have thought that not being terrible with women ought to be a management pre-qualification, given that here on planet Earth women are quite common.)

More importantly, failing to fire a bad apple can completely undermine everything else the company is doing. Novartis is one of the 100 best companies to work for if you're a woman, according to Working Mother magazine. At Novartis, "Jobsharers, telecommuters and other flex fans can rely on the firm's easily customizable child-care offerings, including discounts on fulltime care at national chains with budget-friendly backup (just $15 to $25 per day) and in-home sick care ($5 per hour)," the magazine says.

Letting go troublesome staff is good for them too -- they get to learn fast and early what not to do in the workplace, and their names don't get dragged through the mud in legal proceedings years down the line.

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Gavel image via Flickr user Thomas Roche, CC 2.0.