Dive Brief:
- Edward Jones allegedly discriminated against its Black financial advisers by paying them less than their White counterparts for years, according to a proposed class-action lawsuit filed May 19.
- The financial services company’s client transfer policy “disproportionately” provided White financial advisers with accounts that helped them meet performance targets and earn commissions and bonuses, the complaint alleged. Likewise, the company’s salary assignment policy allegedly used previous earnings to dictate starting salary, “a practice that is well-understood to perpetuate market discrimination.”
- “We strongly deny the allegations in the lawsuit, which do not reflect our values or how we operate as a firm,” an Edward Jones spokesperson said in an emailed statement. “We intend to defend the matter and remain focused on supporting our associates, serving our clients, and acting in accordance with our purpose and values.”
Dive Insight:
The lawsuit was filed by six Black employees and alleged race discrimination.
The workers alleged that the client transfer policy and starting salary policy created an environment in which Black financial advisers “receive less compensation, fewer promotions, and are terminated more frequently than their white peers,” per the complaint.
The lawsuit alleged that the company’s policies violated numerous state and federal laws, including Title VII of the Civil Rights Act of 1964. Title VII prohibits race discrimination in any aspect of employment, such as hiring, firing, pay, job assignments, promotions, termination, training and fringe benefits.
One of the plaintiffs, a Black woman, said that during one of her interviews at a Georgia branch location, a senior White financial adviser told her “she should use a more race-neutral name.” The senior worker then declined to hire the plaintiff.
Among other requests for relief, the plaintiffs asked the court to issue a permanent injunction ordering Edward Jones to change its compensation policies and practices to prevent race discrimination.
Plaintiffs and the proposed class “are now suffering, and will continue to suffer, irreparable injury from Edward Jones’ discriminatory acts and omissions,” the complaint said.