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10.27.2009 10:26 am

Former Anheuser-Busch executive Francine Katz sues brewer, alleges sex discrimination

St. Louis Post-Dispatch
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After leaving the company 10 months ago, Anheuser-Busch’s highest-ranking female executive has sued the brewer, alleging gender discrimination and a pattern of unfair pay practices.

Francine Katz, formerly A-B’s former vice president of communications and consumer affairs and a member of the company’s strategy committee, says in a lawsuit filed in St. Louis City Circuit Court that Anheuser-Busch pays women less than their male counterparts and encourages a “locker room” and “frat party” atmosphere while removing responsibilities from women, blocking their career paths and excluding them from informal social networks.

Katz seeks lost wages and compensatory and punitive damages.

Wow. This is from “one of the most AB-loyal execs we’ve known,” said trade publication Beer Marketer’s Insights. But trouble has actually been brewing for some time. Katz filed a charge of discrimination against A-B and a variety of high-level executives with the Missouri Commission on Human Rights in March.

Katz officially left the company on Dec. 31. She had been on A-B’s top-level strategy committee since April 2002, and was the first woman to reach that level at Anheuser-Busch. She assumed the leadership role for the company’s communications and consumer affairs departments in 2002. She also led the company’s alcohol awareness and environmental outreach initiatives. In 2007, she was the company’s most outspoken and aggressive spokesperson as it tried to refute claims that its caffeine-alcohol drinks appealed especially to minors.

Katz began her career with Anheuser-Busch in 1988 as an associate general counsel in the legal department.

Katz claimed she was given a smaller salary and bonuses than male executives despite repeatedly raising concerns between 2002 and 2007 about the disparity to former A-B Chief Executive Patrick Stokes, former Chairman August Busch III, former CEO August Busch IV and current A-B President David Peacock.

The lawsuit alleges that when Katz was promoted in July 2002, she received all the same duties formerly assigned to John Jacob, A-B’s retiring executive vice president and chief communications officer. But she did not receive the administrative assistant, office suite with a conference room or the same salary, the suit alleges.

The suit said Jacob was paid a base salary of $605,000 and a bonus of $645,000 ($1.25 million total) in 2001, his last year at A-B. By contrast, Katz received $300,000 in base salary and a bonus of $200,000 ($500,000 total) in 2002, her first year in the new position.

Katz received annual raises and bonuses. But by 2007, she still made only 46 percent of what Jacob had earned in 2001, according to the suit. And the suit also says that in 2008, Katz‘ base salary and target bonus were less than the base salary and target bonuses of every male member of the strategy committee. Katz said she discovered that she and the only other female committee member would be the lowest paid committee members in 2008, and that every male committee member was classified as a “Tier I” officer, when both of the women were classified as “Tier II” officers.

Katz said the information come to light as Anheuser-Busch was being sold to InBev last year. Prior to that point, she said, she had attempted to discuss her compensation with her superiors “on numerous occasions.”

“My requests were ignored or met with hostility and misinformation,” she said in a statement.

But on Sept. 19, 2008, Anheuser-Busch filed a document with the Securities and Exchange Commission that disclosed compensation information for all 17 members of the strategy committee.

“It was at that time that I discovered I had been treated differently than my male colleagues both in terms of compensation and in the enhanced severance and benefits to be paid to Strategy Committee members upon completion of the sale to InBev,” Katz said.

In a statement, Anheuser-Busch vice president Terri Vogt said the company believes the complaints are “unjustified.” In a statement, Vogt said the A-B believes that, before Katz resigned from the company, she was “compensated fairly for her roles and responsibilities at Anheuser-Busch and treated in compliance with all relevant laws and internal standards.”

“Our company firmly believes in treating all employees fairly and values the differences of all employees, specifically prohibiting any form of discrimination based on a person’s gender, race, religion, sexual orientation, national origin, disability or other prohibited factor,” according to the statement.

Anheuser-Busch also claimed that any challenges Katz makes about her compensation are subject to a dispute resolution program, which the company said Katz and all other non-union employees agreed to during their employment. The program is an A-B initiative that resolves employment disputes without resorting to lawsuits.

Through a representative, Katz declined to be interview. In a statement, she said the decision to pursue the claim was “not an easy one.”

“I worked at Anheuser-Busch for 20 years and had a fulfilling career,” Katz said. On the strategy committee, she worked with “some of the most talented men in the beer business. They counted me as their peer.”

“As someone who oversaw an exemplary group of people during my tenure at Anheuser-Busch, many of who were women, and as someone who served as a mentor to many women at Anheuser-Busch, I believe it is important to speak up about the disparate treatment I received,” Katz said.

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138 comments

Go get em!

— Dan
10:51 am October 27th, 2009

Jacob was paid $1.25 million in his last year at A-B and Katz was paid $500,000 in her first year at the same position. Since when do less experienced personnel get paid the same as more experienced personnel? As an entry-level project manager I did not make the same amount of money as a senior level project manager, and rightly so since I was less experienced.

Waaaahhh, I only make $500,000 a year. Quitcher bitchin.

— Chuck
10:58 am October 27th, 2009

Perhaps a disgruntled employee? If she has her complaints in writing, then she has a solid case.

Also, what was her salary in 2007? It claims she only made 46% of her predecesors final salary. That would put her at $575,000 with bonuses.

Also, don’t you have to work and earn salary as seniority grows? Her predecesor didn’t make $1.25 million in his first year on the job, and probably didn’t in his next 10. I’m sure he did something to increase his salary substantially. Should you expect to make what a person made in 10 years of work, in your first year of work in that same job?

— Doug
11:03 am October 27th, 2009

Sounds to me as if she’s got a very valid complaint and a winnable case.

— crashtest
11:06 am October 27th, 2009

Chuck, I think the issue is that she was still only making 46% ($575K) of Katz’s 2001 salary ($1.25M) after 5 years on the job. Clearly, 5 years is enough experience to warrant more than a 15% raise over her 2002 salary, isn’t it? This presumes she was performing adequately, which is reasonable given her retention in the position.

— Mike
11:08 am October 27th, 2009

Waaaaa is right! Quit complaining and be happy that you were ever able to make 500k. Some people don’t even ever get to the 50k mark. Also, was she layed off or did she quit on her own? Also, why is she now coming out with this story? Why didn’t she mention it while she was on the job?

I think Doug and Chuck have very valid points.

— mizzougal1981
11:16 am October 27th, 2009

VPs and executives are quite different from Senior/Mid level managers. Usually when a new VP, C-suite officer, etc get promoted or replaced, they make MORE money than what the other person was previously making.
Salaries are usually capped at that level anyway. Most of the potential earning at that level are all from bonuses. So if she was awarded a smaller bonus than her predecessor, and that bonus was tied to company performance, AND that performance is better than it previously was… well she is has a very good case.

— zink
11:19 am October 27th, 2009

“We are tracking down the lawsuit itself” — 0922-CC09513 - FRANCINE I KATZ V ANHEUSER BUSCH ET AL filed 10/26/2009. It took me about 5 seconds on https://www.courts.mo.gov/casenet

EDITOR NOTE: You can easily find the docket information online, but you can’t get the actual complaint, which has the lawsuit details. For that, you have to go to the court house & retrieve the document, which the newspaper just did. That is what Jeremiah meant by “tracking down the lawsuit itself.” Greg Cancelada.

— kenj0418
11:22 am October 27th, 2009

The article states she did notify her superiors of the issue from early on. I’m betting since she began as general counsel, she knows how to document properly and will have a firm case. The fact that she makes big money isn’t the issue. The issue is how it compares to a male in the same position. I’m ‘guessing’ she was laid off during the major lay off period after InBev got inplace.

— sally
11:23 am October 27th, 2009

Didn’t she already make $12 mill when the In-Bev bought them out?

— Tom
11:27 am October 27th, 2009

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