Microsoft has agreed to pay $14 million to settle allegations by the California Civil Rights Department that it unlawfully penalised workers who took medical or family-care leave.

The settlement, announced on Wednesday, resolves claims that the company retaliated against California-based employees who used parental, disability, pregnancy, and family-care leave since 2017.

The state agency accused Microsoft of denying affected workers raises, promotions, and stock awards. These employees, predominantly women and individuals with disabilities, allegedly received lower performance-review scores, which in turn suppressed their pay and career opportunities.

While Microsoft has denied any wrongdoing in the settlement agreement, a company spokesperson stated, "Microsoft is committed to an environment that empowers our employees to take leave when needed and provides the flexibility and support necessary for them to thrive professionally and personally."

The settlement, which requires approval from a state judge, concludes a multi-year investigation by the California Civil Rights Department. It is part of a series of recent large settlements in sex-discrimination cases pursued by the agency, including a $100 million deal with Riot Games in 2021 and a $54 million settlement with Activision Blizzard last year.

As part of the agreement, Microsoft will hire an independent consultant to ensure company policies do not discriminate against workers taking leave. The tech firm will also provide training to managers and human resources personnel.

Kevin Kish, director of the California Civil Rights Department, commented, "The settlement announced today will provide direct relief to impacted workers and safeguard against future discrimination at the company."

Microsoft, headquartered in Redmond, Washington, employs approximately 6,700 people in California. The exact number of workers who may benefit from this settlement remains unclear.

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