Office space firm WeWork and its beleaguered former chief executive officer Adam Neumann are facing a sexual discrimination lawsuit from a former chief of staff claiming she was repeatedly disparaged and discriminated against during and after two pregnancies.
The lawsuit, filed by Medina Bardhi with the Equal Employment Opportunity Commission in New York, claims WeWork’s management “transparently and systematically marginalized and discriminated against her by drastically and materially reducing her role and/or demoting her outright” when she returned after her maternity leaves.
Each time she disclosed her pregnancy to Neumann, Bardhi claims, WeWork began to search for a permanent replacement while Neumann repeatedly characterized her leave as “retirement” and “vacation”.
Bardhi, who worked for the company for five years, alleges that during one pregnancy she was replaced by a male employee who received a salary nearly three times greater than hers and she was ultimately replaced by less-experienced and under-qualified male employee.
In a statement WeWork disputed Bardhi’s claim, saying it plans to “vigorously defend itself”.
“We have zero tolerance for discrimination of any kind,” the company said in a statement. “We are committed to moving the company forward and building a company and culture that our employees can be proud of.”
The suit comes less than two weeks since Neumann controversially left the company he cofounded with a $1.7bn exit package after plans to take the office-share company public collapsed last month, taking with it investor confidence in unprofitable “unicorn” companies.
WeWork, which saw its expected public valuation drop from $47bn to $8bn as complaints over Neumann’s management and autocratic style mounted, has since been taken over with a $9.5bn rescue package by the Japanese tech investment firm Softbank, its largest investor.
On Wednesday, the leading activist investor Bill Ackman, a billionaire hedge fund manager, told a conference in New York that the company could turn out to be worthless.
“As someone who has put good money after bad, I think this looks like putting good money after bad, and SoftBank should have walked away,” Ackman said.
Anger over Neumann’s exit package has increased as expectation mount that as many as 4,000 of WeWork’s 12,000 staff members could lose their jobs as soon as tomorrow as the company looks to cut costs.
But the lawsuit can only add to the impression, that WeWork, along with other so-called tech “unicorns”, including the rideshare firm Uber, were not only financially mismanaged as private companies but tolerated sexist, discriminatory workplace environments.
Bardhi’s attorneys said in a statement that the suit against WeWork, which could become a class action complaint if other employees join the action, “will send a loud and clear message to WeWork and other startups that pregnant women cannot be forced out of their jobs, that women must be paid fairly and afforded equal opportunities, and that you cannot retaliate against any person who voices a complaint of discrimination.”
The attorney Doug Wigdor added: “It is astonishing that WeWork could reward Adam Neumann’s blatant sexist behavior with a staggering and unprecedented golden parachute worth over a reported $1bn, while the company has subjected Ms Bardhi and other women to repeated and systematic marginalization.”