• Seventh Circuit Rejects Brokers’ Challenge of Production Based Bonuses As Racially Discriminatory
  • October 4, 2012 | Author: Andrée Peart Laney
  • Law Firm: Bressler, Amery & Ross A Professional Corporation - Florham Park Office
  • On September 11, 2012, in McReynolds v. Merrill Lynch & Co., 115 FEP Cases 1668 (7th Cir. 2012), the Seventh Circuit Court of Appeals affirmed the district court’s dismissal of a race discrimination action brought by nine African American financial advisors (“FAs”) and trainees against Merrill Lynch, Pierce, Fenner & Smith (“Merrill Lynch”) and its parent corporation, Bank of America (“BoA”). The plaintiffs alleged that the retention bonus program, which Merrill Lynch implemented shortly after it was acquired by BoA in 2009, intentionally discriminated against African Americans in violation of Title VII and 42 U.S.C. § 1981 by calculating bonus amounts based on the FAs’ pre-acquisition production. Citing both statistical evidence reflecting lower production and retention and anecdotal evidence of alleged direct discrimination of African American FAs, the plaintiffs contended that pervasive race discrimination within Merrill Lynch had unfairly suppressed the production of African American FAs. Most significantly, the plaintiffs contended that the retention bonus program was designed with the intent to discriminate against African American FAs and to “lock in” the effects of past discrimination.