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The Year in Review: #16. Black Eye for GE

General Electric Co. enjoyed a reputation as an incubator for successful future general counsel during the past 40 years--that is until one of its own filed a gender discrimination suit against the company in May.

In the $500 million slap-in-the-face class action suit, Lorene Schaefer, GC of the company's transportation division, alleges GE doesn't pay female executives as much as their male counterparts and that the company failed to promote women at the same rate it promoted men from a lower level to senior executive and officer levels.

She also alleges that after 13 years of exemplary tenure she was going to be demoted. Gary Sheffer, executive director of communications and public affairs at GE, says Schaefer was told the business would hire a new general counsel to whom she would report.

Schaefer is seeking class action certification on behalf of 1,500 female executives.

In response GE filed a motion to dismiss on behalf of the individual defendants in the suit, but not GE. "According to Title VII, an employee can sue a company for discrimination but not an individual," says Richard Bales, law professor at Northern Kentucky University.

On paid administrative leave, Schaefer remains GC of GE Transportation.

"This lawsuit is designed to achieve systemic injunctive relief to change GE's discriminatory pay and promotions practices and policies," Schaefer charged in court papers. "From 2002 to the present, women have made few inroads into the domain of the officer's 'club' at GE."

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Yesenia Salcedo

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