Activision Blizzard will pay $55m to settle sex discrimination lawsuit

Activision Blizzard will pay over $50 million to settle a 2021 lawsuit filed by the state of California alleging that the video games giant discriminated against women by offering them lower pay and fewer promotion opportunities.

The lawsuit was filed in the summer of 2021 after two years of investigation by California's Department of Fair Employment and Housing (DFEH) that accused the Call of Duty, World of Warcraft and Diablo makers of fostering "a breeding ground for harassment and discrimination against women".

Over two years on from that filing, California’s Civil Rights Department announced that they had now reached an agreement with Activision Blizzard to settle the suit with regards to their Equal Pay Act and Fair Employment and Housing Act laws.

The $54.875m settlement - which is now subject to approval by the Los Angeles County Superior Court, meaning its exact figures and terms could still change - will see roughly $46m used to compensate female staff and contract workers who were employed by Activision Blizzard between October 2015 and the end of 2020.

Any leftover money from the fund will benefit charities and other organisations “focused on advancing women in the video game and technology industries or promoting awareness around gender equality issues in the workplace”.

In addition, the CRD said that “Activision Blizzard will take additional steps to help ensure fair pay and promotion practices at the company”. Those steps include retaining an independent consultant who will evaluate and make recommendations regarding compensation, promotion and training at the company.

As reported by the Wall Street Journal, the reaching of the settlement means that the CRD will dismiss their suit and claims that "Activision Blizzard senior executives ignored, condoned or tolerated a culture of systemic, harassment, retaliation, or discrimination". The state department said that "no court or any independent investigation has substantiated any allegations [of] systemic or widespread sexual harassment at Activision Blizzard".

"We are gratified that we have reached an agreement with the California Civil Rights Department today,” Activision Blizzard told GamesIndustry.biz in a statement. “We appreciate the importance of the issues addressed in this agreement and we are dedicated to fully implementing all the new obligations we have assumed as part of it.

“We want our employees to know that, as the agreement specifies, we are committed to ensuring fair compensation and promotion policies and practices for all our employees, and we will continue our efforts regarding inclusion of qualified candidates from underrepresented communities in outreach, recruitment, and retention."

Update 20/12/2023: An Activision Blizzard representative shared the following additional statement with Rock Paper Shotgun:

“We are also gratified that the CRD has agreed to file an amended complaint that entirely withdraws its 2021 claims alleging widespread and systemic workplace harassment at Activision Blizzard. As the CRD acknowledged explicitly in the agreement, 'CRD is filing along with a Proposed Consent Decree a Second Amended Complaint that withdraws, among other allegations and causes of action, the Fifth Cause of Action – Employment Discrimination – Because of Sex – Harassment.'

"As the CRD also expressly acknowledged in the agreement, 'no court or independent investigation has substantiated any allegations that there has been systemic or widespread sexual harassment at Activision Blizzard.' In addition, the CRD has acknowledged that no court or independent investigation substantiated any allegations that 'Activision Blizzard’s Board of Directors, including its Chief Executive Officer, Robert Kotick, acted improperly with regard to the handling of any instances of workplace misconduct.'”