Two Former AIG VPs File Discrimination Suit in Conn. District Court

Two former vice presidents at American International Group Inc. are suing the company for terminations they claim were based on their age and gender. The discrimination lawsuit was filed in the U.S. District Court of Connecticut by the two women, who formerly worked at AIG Financial Products Corp.

Former executives Susan Potter and Deonna Taylor claim that during their time with the company, they received salaries and bonuses that were less than similarly placed male colleagues. The company "fostered a 'boys club' atmosphere and a culture of gender and age discrimination against older women," the suit said. Both claim that their salaries were held at $100,000 for years, though male colleagues at the company regularly earned more.

Mark Herr, a spokesman for AIG, said in a statement that AIG "denies it discriminated or retaliated against these plaintiffs. AIG prohibits discrimination on the basis of age, sex or any other protected category and is committed to providing employees with a workplace free from unlawful discrimination and retaliation."

Potter, a long-time facilities manager at the company, was promoted to vice president in 2007. She said she objected annually between 2002 to 2008 about her unchanging $100,000 base salary, which she was allegedly informed was capped at its highest possible level. She also claimed she was repeatedly blocked from promotions that went to younger males. When she obtained a promotion in 2007 after 10 years as an assistant vice president, she said her salary was not increased.

In October of 2008, Potter and Taylor filed discrimination charges with the Connecticut Commission on Human Rights and Opportunities and the U.S. Equal Employment Opportunity Commission. Two weeks later, Taylor was terminated in a round of layoffs as the company sought to dismantle itself following AIG's near collapse in the U.S. financial crisis.

Three months later, Potter said the company classified her as a part-time employee. In July of 2009, Potter's position was then eliminated in a second round of layoffs. She was 56 years old when terminated, and Taylor was 60.

Taylor said she was paid the $100,000 base salary from 2001 until she was laid off, though during that period she received promotions to assistant vice president and, in 2006, to vice president and director of research. Taylor also claims to have made repeated complaints to her superiors about what she considered unfair pay and subsequently "found that her position was marginalized."

At one point, her work station was near the company's trading floor. "On the trading floor, Ms. Taylor encountered lewd comments," the complaint said.

The suit, which alleges sexual and age discrimination and retaliation, asks for back pay and benefits, reinstatement, damages and legal costs.

The financial products division of AIG (NYSE: AIG) has been blamed for the insurance giant's near collapse in 2008, and it was the cause of a federal intervention that left about 80% of the parent company owned by the U.S. government (BestWire, Sept. 19, 2008).

AIG stock was at $25.37 in Feb. 26 trading, down 7.8% from the previous day's close following the pre-session release of a fourth-quarter $8.9 billion loss (BestWire, Feb. 26, 2010).

Most AIG companies have current Best's Financial Strength Ratings of A (Excellent).

(Jesse A. Hamilton, Washington bureau manager: [email protected])