The settlement 21st Century Fox announced Tuesday regarding former anchor Gretchen Carlson, who filed a lawsuit this summer claiming sexual harassment by the powerful -- and now ousted -- Fox News chairman Roger Ailes, was extraordinary in many ways. There was the speed with which the suit went from being filed, on July 6, to being settled, just two months later. There was the reported size of the settlement, $20 million, which employment lawyers say is the largest single plaintiff pre-trial settlement for sexual harassment charges they know of (many are settled privately).
But perhaps the most striking aspect of the settlement was the company's public apology to Carlson in its statement, a move employment lawyers said was extremely rare, if not unprecedented, when it comes to sexual harassment claims.
"Typically the last thing a plaintiff ever receives in a pre-trial settlement is an apology," said Debra Katz, a Washington lawyer who often represents plaintiffs in sexual harassment lawsuits. "It clearly is a recognition that she was right that she was treated inappropriately, and that in and of itself is quite stunning."
In its statement, 21st Century Fox, the parent company of Fox News, where Carlson was a former anchor and Ailes was its powerful chairman until recently, praised Carlson's skills and said it was "proud" she had been part of the organization. "We sincerely regret and apologize for the fact that Gretchen was not treated with the respect and dignity that she and all of our colleagues deserve," the statement read.
More typically, if a settlement is announced at all -- many sexual harassment claims stay quietly under wraps -- it comes with a "non-statement," says Amy Bess, an employment lawyer at Vedder Price. The company denies wrongdoing and says it is moving on to avoid the distraction and uncertainty that comes with the legal process.
"What Fox is trying to do is demonstrate publicly that this is not business as usual," Bess said. They're trying "to make a statement to the public that this company is turning over a new leaf. It's gotten rid of the evil doers, and they're now focusing on a more positive, proactive, non-discriminatory culture that is a good place for women to work."
Most companies don't make such a statement of regret because it could expose them to some risk. "It's not an admission of legal liability, but it’s still saying she was not treated with the dignity she deserved to be treated with," says Dan Eaton, a San Diego-based employment lawyer. "It suggests a company may be amenable to making a settlement on similar terms in future cases." (A spokesperson for 21st Century Fox declined to comment about why the company chose to make the apology, but pointed to earlier statements about its prompt investigation and the seriousness with which it has taken the allegations.)
Yet in this case, employment lawyers said, Carlson is thought to have negotiated for and demanded nothing less than a public apology. "Fox, in acknowledging she was treated badly, may be signaling to other employees that there’s going to be a culture change, that they're not going to tolerate this kind of behavior," Katz said. "But I'm confident that she insisted upon it." (A message to Carlson's lawyer was not immediately returned.)
That's partly because it's one of the most basic things plaintiffs desire when they consider pursuing a sexual harassment suit, Katz says. "It's usually the first thing people who walk into my office want," she says. "We're not just talking about explosive, high-profile claims like this. Even in the most mundane employment situations, people want an acknowledgement. But it's usually the last thing they get." Katz said none of her clients had ever received a public apology for similar claims.
Besides an apology, one other thing Carlson will be getting, meanwhile, is a $20 million settlement. The size of that payout is larger than any known pre-trial settlement for a sexual harassment claim by a single plaintiff, Katz said, noting that such figures are often kept private. Its size likely reflects Carlson's high compensation as a media figure, as payouts are often determined based on loss of future income. Yet for Fox, Katz said, "it's a rounding error. The bigger cost is everything else" -- the legal costs, the reputation damage -- "that has exploded as a result."
While $20 million may be larger than other settlements for similar claims, it's also, interestingly, exactly half the size of the exit package Ailes was reportedly paid. After Ailes stepped down as the chairman and CEO of Fox News in July, just two weeks after Carlson's lawsuit was filed, reports said he would receive more than $40 million and remain an adviser to Rupert Murdoch, executive chairman of 21st Century Fox.