The state of Missouri has filed a lawsuit against technology giant International Business Machines Corporation (IBM) for allegedly illegally mandating race and gender quotas in its employee hiring and promotion processes.
Missouri’s Republican Attorney General Andrew Bailey filed a lawsuit against the company on Thursday, alleging that the practice violates the Missouri Human Rights Act.
“I have learned that IBM has adopted an unlawful policy that clearly favors applicants of a certain gender and skin color over others, and that any manager within the company who does not comply with that policy faces adverse action, up to and including termination. Workplace discrimination violates both state and federal law, which is why I have filed this lawsuit,” Bailey said.
“Missouri citizens have a right to an explanation as to why one of the world’s largest technology consulting firms with offices in Missouri is engaging in discriminatory practices against both prospective and current employees,” he said.
The lawsuit, filed in St. Louis County Circuit Court, alleges that IBM uses a “diversity adjustment factor” — a standard that requires the company to obtain certain hiring quotas each year based on race, color, national origin, sex and ancestry — when making employment decisions.
“If IBM executives meet their quotas, IBM gives them the carrot of a positive bonus. But if they fail to meet their quotas, IBM wields the stick — which means they lose a portion of their bonus and ultimately their job,” the lawsuit alleges.
A company spokesperson denied the allegations in a statement to Fox News Digital, saying, “IBM does not employ quotas, and has never done so, and any suggestion otherwise is false.”
IBM is one of the largest technology companies headquartered in New York and has a history spanning more than 100 years. As of 2023, IBM employs approximately 282,000 people worldwide.
“IBM has demonstrated its intent to use discriminatory and inadequate means to achieve its discriminatory and unjust objectives,” the complaint states.
“Plaintiff, the State of Missouri, has filed this lawsuit to end IBM’s unlawful conduct that has affected, is currently affecting, and will harm Missourians if not stopped,” the statement said.
“Tying quotas to bonus compensation not only serves as an incentive to reach desirable demographics but also acts as a cudgel against those who do not comply,” the lawsuit states.
According to the lawsuit, IBM CEO Arvind Krishna “knew that obtaining these quotas would necessarily mean reduced opportunities for other groups that IBM did not consider to be ‘underrepresented minorities.'”
“Through its use of ‘diversity modifiers,’ IBM seeks to tilt the balance in favor of some races, skin colors, national origins, ancestry and sex and unfairly favor others,” the lawsuit alleges.
“Hiring at IBM is zero-sum because[a] Benefits offered to some applicants [and employees] “But it does not necessarily benefit the former group at the expense of the latter,” the lawsuit says, citing the recent Supreme Court decision, Students for Fair Admissions v. Harvard University.
The case, decided last summer, made discriminatory practices in higher education admissions, known as affirmative action, illegal. Though the case involved a US university, legal experts say it will change the liability landscape beyond campuses and alter how other companies and entities pursue diversity, equity and inclusion, or DEI, practices.
The Show Me State lawsuit seeks to “permanently enjoin IBM and all of its employees, officers and agents from using IBM’s ‘diversity adjustment’ quotas.”
“It is an unlawful discriminatory practice for an employer to withhold or refuse to employ an individual, or to discriminate against an individual with respect to compensation, terms, conditions, or privileges of employment, because of that individual’s race, color, national origin, sex, or ancestry,” the complaint states.
IBM did not immediately respond to FOX Business’ request for comment.
