QCOM QUALCOMM Inc

By Sara Randazzo 

Chip maker Qualcomm Inc. will pay $19.5 million to settle claims that women at the company receive lower pay and fewer chances for promotion than men, according to papers filed Tuesday in a San Diego federal court.

The deal will affect roughly 3,300 current and former Qualcomm employees, primarily those in science, technology, engineering and math positions.

As part of the agreement, which requires approval from a federal judge, Qualcomm also said it will try to level the playing field for women going forward, including hiring independent consultants and an internal compliance officer, ramping up training, and conducting regular pay-equity and promotion analyses.

"Qualcomm is committed to treating its employees fairly and equitably," Christine Trimble, the company's vice president of public affairs, said in a statement Tuesday.

The plaintiffs alleged women at Qualcomm face "systemic gender discrimination," which they say is more acute for working mothers. That includes a "flawed" compensation system that negatively affects female employees, according to court filings, and a promotion system that relies on sponsorship by mostly male managers rather than allowing interested parties to apply for openings.

"The effects of this model in the context of Qualcomm's male-dominated culture are apparent in the trend towards reduced proportions of women at each successive level of Qualcomm's hierarchy," the plaintiffs claimed. Women hold less than 15% of senior leadership positions at the company, court filings show.

Plaintiffs and the San Diego-based company reached the settlement before a lawsuit was actually filed. Plaintiffs' lawyers have been in negotiations with Qualcomm outside of court since autumn.

Ms. Trimble said the company believes it has "strong defense to the claims" but "elected to focus on continuing to make meaningful enhancements to our internal programs and processes that drive equity and a diverse and inclusive workforce."

David Sanford, an attorney for the employees, called it an "extraordinary result" and said not all companies will take Qualcomm's stance and work through the issues outside of court.

Plaintiffs' attorneys are requesting 30% of the settlement for themselves, leaving an estimated $13 million for the affected employees to split after additional expenses are taken out. The women are expected to be paid just under $4,000 each on average before tax, court filings show, calculated on time with the company and other factors.

The company discouraged taking leave and penalized female caregivers, the plaintiffs say, by rewarding a culture of working late and being available 24/7.

Qualcomm, which has around 15,000 employees in the U.S., makes processors and modem chips for smartphones and licenses cellular technology patents to smartphone makers.

The company reported revenue of $6 billion in the three-month period ending June 26, with profits of $1.4 billion that beat analyst expectations.

Write to Sara Randazzo at sara.randazzo@wsj.com

(END) Dow Jones Newswires

July 26, 2016 18:37 ET (22:37 GMT)

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