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Discrimination charges at Pinterest reveal a hidden Silicon Valley hiring problem

Two Black women who worked at Pinterest went public with their stories of pay disparity and discrimination. Their experience illuminates tech’s wider problems with pay “leveling.”

Discrimination charges at Pinterest reveal a hidden Silicon Valley hiring problem
[Source image: Clker-Free-Vector-Images/Pixabay]

In July of 2018, Ifeoma Ozoma started a new job as the public policy and social impact manager at Pinterest. After working on the large public policy teams at Facebook and Google, she was excited to be the second person on Pinterest’s team, where her responsibilities included leading half of the global public policy team’s work. She believed she would be building the team from the ground up, with the head of public policy as her partner. Plus, Pinterest was pre-IPO, meaning that there was a significant financial opportunity to be had once the company went public.

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But two months later, in September of 2018, Ozoma saw the public policy and legal team’s “level chart,” a document that lays out the “role expectations” for employees at each of the five salary levels for the job family. Ozoma, who is a Black woman, was shocked to discover that her level was the second to lowest. She later learned that the head of public policy, a white man who was her manager but whom she worked with as a close partner, was at the highest level.

Ifeoma Ozoma [Photo: courtesy of Ifeoma Ozoma]
“I immediately started asking questions, like ‘Whoa, whoa, you have me at second to lowest rung on this chart even though I’m leading all of this work?'” Ozoma says. “I’m half of the team, I’m doing half of the work of the team, and I’m in a very junior level when it comes to pay and my pay bracket.”

Ozoma asked her manager to address her level, but she says she was initially told that her current compensation package was the best the company could do. After months of trying to get her level changed, Ozoma finally hired a lawyer, who began to argue that she should have been hired at a level six, two rungs above the level four at which she was being paid. Once her lawyer got involved and began advocating for additional compensation, stock options, and back pay, Ozoma was told she didn’t have enough years of experience—a criteria that does not appear on the level chart, which Fast Company has confirmed. Ozoma describes the difference in compensation between these levels as “exponential,” especially because much of the pay package comes in the form of stock options—which quickly became very valuable when Pinterest IPOed in April 2019. In July 2019, she filed a complaint with California’s Department of Fair Employment and Housing (DFEH), alleging pay discrimination based on sex and race.

I’m half of the team, I’m doing half of the work of the team, and I’m in a very junior level when it comes to pay.”

Ifeoma Ozoma

On June 15, Ozoma went public with her story in a Twitter thread after seeing Pinterest’s statement in response to the protests sweeping the country, which expresses the company’s “solidarity” with the Black Lives Matter movement as well as its “commitment to taking action.” She was swiftly followed by her colleague Aerica Shimizu Banks, another Black woman who was recruited as a public policy and social impact manager at Pinterest. Banks ended up deciding the division of labor on the three-person team, and her role was leading U.S. federal policy. But she was also hired at a lower level than the work she says she was doing. Both women quit their jobs on the same day in May.

“Once I saw the chart, after I was hired, I was concerned that I was not leveled appropriately and was willing to dismiss those concerns if I were promoted,” Banks says. “My manager avoided answering my questions about promotion for weeks, thus denying me the opportunity to address my concerns . . . Consistently I went through all proper internal channels on all my complaints and was met with denial and dismissal. It was time to go external.”

Like Ozoma, Banks filed a complaint with the DFEH in January 2020, alleging pay discrimination based on sex and race as well as retaliation for reporting the discrimination. She received the right to sue in February 2020. Both complaints, which Fast Company has reviewed, allege that Ozoma and Banks were doing substantially similar work to their manager, a white man, but were both paid at lower levels.

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“We found out he was at the highest level even though we were splitting the work equally in two, and then in three when Aerica started,” Ozoma says. “We were leading the most substantive work that most materially benefited the company.”

Aerica Banks [Photo: courtesy of Aerica Banks]
After Ozoma and Banks shared their story publicly, Pinterest initially denied the allegations, saying in a statement that the company had conducted a thorough investigation of the women’s claims when they were raised and that “we’re confident both employees were treated fairly.” Pinterest soon changed its tune, with CEO Ben Silbermann acknowledging that the company needs to do better in an internal letter. He also laid out plans to add a person of color to the company’s board and evaluate all of the company’s senior leaders based on their recruiting practices. This week, Pinterest announced it was hiring an outside law firm to conduct a “comprehensive and independent review of our policies and practices concerning discrimination, harassment, and other workplace issues.”

“We never want anyone to feel the way Ifeoma and Aerica did while they were working at Pinterest. We’re committed to immediately taking the actions that we’ve outlined to our employees, and we’re actively pursuing this work,” says a Pinterest spokesperson when reached for comment.

Beyond platitudes

During the most intense racial reckoning this country has faced in decades, dozens of tech companies have stepped forward with statements of support. But given the gaping lack of diversity in tech and the racism and bias problems inherent to many tech products, critics have seen these gestures as little more than platitudes. For both Ozoma and Banks, Pinterest’s statement was a slap in the face after the duo had faced not only pay disparity, but other internal difficulties. Banks says that after she raised issues of pay and reported a colleague’s disparaging remarks about her ethnicity to HR, she faced retaliation. When she recommended that the company not cut pay for contractors over a holiday, Banks says she was stripped of her responsibilities.

When Ozoma was doxxed by another Pinterest employee, she turned to former colleagues at Facebook and Google, who helped her manage the onslaught of racist and sexist messages that she received after her colleague posted her personal information across the internet’s darkest corners. She says she received little help from the company during the first week after the doxxing, and by the time Pinterest decided to step in, much of the cleanup work had been done.

None of this stopped Ozoma from leading some of Pinterest’s most publicized policy changes, including taking down all vaccine misinformation and ending the promotion of slave plantations as attractive wedding venues. The vaccine decision helped shape Pinterest’s image as a leader in handling misinformation online, resulting in articles in publications like The Wall Street Journal, CNN, NPR, and Fast Company, for which she served as the company’s public spokesperson. Banks opened the company’s Washington, D.C., outpost and served as Pinterest’s representative with the federal government, including the FBI and members of Congress, according to her DFEH complaint, along with shaping the company’s regulatory strategy and the company’s position on public policy matters.

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“For me and Aerica, we were public policy executives managing work on behalf of the company globally, but we were being paid as though we were junior assistants,” Ozoma says.

“The problem is you never catch up”

Their story, which has been widely reported as an example of how Black women are treated at tech companies, also highlights an under-recognized element of pay disparity. When many people think about the gender or racial pay gap, the common assumption is that women do not receive the same pay as men when they have the same title and responsibilities. But systemic discrimination can also occur based on what level people enter a company when they are first hired.

“The problem is you never catch up,” says Jim Finberg, an attorney at Altshuler Berzon who is representing female employees in a class action pay discrimination lawsuit at Oracle and in a pay discrimination lawsuit against Google. “If a woman comes in at level three when she should have been level four, [then] she gets promoted to level four. The man gets promoted to level five. She’s still a level behind him. Although she’s getting promoted, she’s not catching up to him. She’s never catching up to him.”

Although she’s getting promoted, she’s not catching up to him. She’s never catching up to him.”

Jim Finberg

Being misleveled can also have an outsize economic impact on a person’s career going forward. “The earlier in your career it happens, it can follow you for the rest of your life,” says diversity consultant Kim Elsesser. “If it only happens to you once, and you stay a level behind a male peer for your entire career, that could result in hundreds of thousands of dollars over your career if not more. And that’s assuming it only happens to you once. What happens is it often happens to women over and over again.”

Ozoma recognized this problem when she first raised concerns about her level. She says that she and her manager agreed to address her level at the end-of-year review. “When January came around and what he presented me was a performance-based raise—which is the raise that anyone who got the performance review I got, which was the highest Pinterest has, ‘always exceeds expectations,’ which was in line with the work I was doing—everyone got that same calculated raise,” she says. “I was like, this isn’t actually addressing my level. This is an issue. Then I started pushing.”

While inappropriate leveling impacts all women, the racial wage gap means that Black women in particular tend to receive even lower salaries than their white counterparts. 2018 Census data shows that on average, Black women make 61% of what white, non-Hispanic men earn—and 21% less than white women.

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Discriminatory leveling is just one mechanism that adds to the race and gender pay gap. “It does have a disparate impact against women. It wouldn’t surprise me if it also had a disparate impact on people of color,” Finberg says.

It’s also a common problem in the tech industry. “What we saw in the Google case is that women who had education and experience at comparable levels and amounts to men were often assigned to lower levels than men with the same education and experience,” Finberg says. “We’ve done a statistical analysis of Google’s hiring and payroll data and have found that in fact there is a pattern of practice of that. It’s statistically significant even controlling for factors like education and experience. Women were assigned to lower levels.”

In 2019, Google released its own study of pay data, and announced that it was actually paying women more than men—prompting the company to give out pay raises to thousands of men. But according to critics, including Elsesser, the study itself entirely missed the problem with unfair leveling because it only analyzed salaries between men and women with the same title, responsibilities, and level.

“Google is just one example,” Elsesser says. “Other companies do it the same way . . . they compare everyone at the same level, and they say, ‘Oh look, men and women make the same thing so we don’t have a problem.’ It almost exacerbates the problem because it makes them think the problem is solved and they don’t have to work on it anymore.”

The earlier in your career it happens, it can follow you for the rest of your life.”

Kim Elsesser

Why does this level-based discrimination happen in the first place? Finberg believes that in Google’s case, the problem arose because applicants were asked about their prior pay—at least until a 2018 California law that prohibited employers from asking for exactly this reason came into effect. The previous salary information was used to assign future employees to the level that corresponded to that prior pay, regardless of experience. “Because women had lower prior pay, that meant that they were routinely assigned to lower salary levels,” he says. “So it perpetuated compensation confirmation against women.”

Ozoma says that while she wasn’t asked directly about her previous salary, the Pinterest recruiter hinted at her previous level at Facebook. Ozoma says she refused to confirm it, citing the California law. In addition, she says that she never learned what her new level would be. “Level isn’t meant to be stagnant. My level at Facebook was appropriate for the work I was doing there (as part of a several-hundred-member global team),” Ozoma says. “That did not translate in any way to the responsibilities and impact I picked up at Pinterest.”

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Banks says she was asked about her salary expectations, and she provided a minimum salary. She says she was told a salary range for her position and was offered less than the top of the range.

When leveling isn’t objective

Pay disparity continues to be a widespread problem, both in Silicon Valley and at companies of all kinds. But in some ways, the leveling problems Ozoma and Banks faced are unique to tech companies.

Leveling itself has roots in the different career paths set up at companies such as DuPont and 3M after World War II, which aimed to attract technical talent by creating a new career ladder that did not involve managing others. That allowed star scientists to advance and gain greater recognition and pay without having to take on managerial tasks, according to Osman Ahmed Osman, the author of a technical recruiting and hiring guide who is now an entrepreneur.

“That model was successful. That’s really the root of where this idea came from,” he says. “You look at modern tech companies today, and they want to hire the smartest people, but they have to reward them—not just with career paths but also financially.”

Today, levels at tech companies aren’t just for technical career paths, though that’s often where you’ll hear the term used. In the Google case, for instance, the main plaintiff was a software engineer named Kelly Ellis who was assigned the level SE3, while a male colleague on her team with the same experience and education was assigned the higher level SE4. Levels are now prevalent in most if not all sections of both large tech companies and some startups, though the specific levels themselves differ based on job family. At Pinterest, for example, the legal and public policy team had its own level chart.

The tech industry views itself as being really meritocratic.”

Osman Ahmed Osman

“Any company wants people working there to feel rewarded and have a path,” Osman says. “It’s an alignment tool. Whether it’s technical or non-technical, if you’re doing good work, you want to be recognized and rewarded for it.”

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In an ideal world, a level chart would be an objective, transparent way for everyone within a job family to know where they stand and what they need to do to advance to the next level.

“The tech industry views itself as being really meritocratic,” Osman says. “If you reward people by putting them on some rung in a ladder based on the merit or impact they’re having, that helps reinforce that.”

But as in Ozoma’s and Banks’s cases, the level chart was not necessarily a guarantee of fair pay. Nor was it an objective document. Ozoma says that she found out that her manager had written the chart, with oversight from the general counsel, in early 2019. Banks says that when she was negotiating, she was told that both Ozoma and the head of public policy had written the chart together, even though Ozoma says she was not involved in it at all.

Despite the pay discrimination lawsuit against Google, Ozoma says she had a positive experience at the company. “My experience before Pinterest, at Facebook and Google, is that HR helps to craft the role expectations so they’re as fair and objective as possible. For some other companies, they may include years of experience or other information in the chart,” Ozoma says.

In an inherently subjective hiring process, creating a level chart that’s as clear and objective as possible is necessary, according to diversity consultant Elsesser. “You need objective criteria for determining the levels. It’s not, this guy is a lot like me, so I’m going to make him this level,” she says. “This is how many years experience, or this is the education level you need to achieve to be at this level. You have to have firm criteria.”

Systemically and systematically the company made sure that Black women in our cases did not reap the benefits of the work we did.”

Ifeoma Ozoma

The financial loss that both Ozoma and Banks have faced as a result of misleveling is likely substantial, especially given Pinterest’s 2019 IPO. “Their refusal to fix the situation meant that when the company went public—an IPO made more successful by the work I did—I didn’t get to partake in the financial benefit from that,” Ozoma says. “Systemically and systematically the company made sure that Black women in our cases did not reap the benefits of the work we did.”

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While Ozoma says her goal in going public was not to pressure Pinterest into paying her, she says she agrees with a statement released by the racial justice organization Color of Change, which insists that Pinterest apologize and provide “due compensation.” To date, 24,413 people have signed a petition listing similar demands. When asked about whether Pinterest intends to make up for lost wages and stock options, the company declined to comment.

“Pinterest should make us whole and they should institute pay transparency,” Ozoma says, citing the work of former Google employee Erica Baker, who started a spreadsheet in 2015 where people could fill in their salary information (a New York Times analysis of the spreadsheet found that women were paid less than men in five out of six job levels). Some tech companies practice pay transparency, such as Buffer, which publishes all of its employees’ salaries on its website. Other crowdsourced efforts, such as levels.fyi, aim to illuminate pay packages at different companies and help job applicants navigate the tangled world of Silicon Valley compensation. But at most companies, employers still know far more than employees about pay and any disparities. “When it comes to underrepresented groups . . . this is where the company having an information and power advantage really takes a toll,” Osman says.

Elsesser also advocates for pay transparency as a means of addressing the gender pay gap. She believes that leveling as a means of pay disparity is a solvable problem. It just requires enough will.

“It’s not rocket science. These big tech companies could figure this out,” she says. “But you have to want to know the right answer.”

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About the author

Katharine Schwab is the deputy editor of Fast Company's technology section. Email her at kschwab@fastcompany.com and follow her on Twitter @kschwabable

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