Human Relations in Organizations: Applications and Skill Building 8th Edition by Robert Lussier

Exercise 32

Sleepless in Seattle or Sexism in the City: Neither Story Ends Well for Boeing
When W. James (Jim) McNerney, Jr., became the chair and CEO of Boeing Commercial Airplane Group, he wasn't warned by the world's leading aerospace company and the largest manufacturer of commercial jetliners and military aircraft of what was to come. Not even his staff had given him fair warning before a problem hit the court's radar. More than 20,000 current and former female employees out of a potential pool of 29,000 said Boeing discriminated against them at Seattle-area plants. According to company documents obtained by the plaintiffs, women typically earned $1,000 to $2,000 less each year than men for similar jobs-a disparity magnified over time by the company's policy of calculating pay raises based on an employee's salary.
This revelation must have been quite shocking to the new CEO, given Boeing's corporate values and ethical standards. Boeing seemed quite committed to its ethical standards in that it conducted three mandatory and educational activities annually as reminders of its commitment to ethics and business conduct standards. Furthermore, the company's policy on equal employment opportunity prohibited discrimination in all terms and conditions of employment.
What might be more shocking to CEO McNerney than Boeing's apparent hypocrisy? Why, the loss of government contracts for lack of compliance with federal regulations, not to mention the negative press. The only question left for the new CEO was how he was going to make this whole mess fly away. The solution was to settle out of court, paying $72.5 million.
Presumably, Boeing values the diversity of its workforce. What additional measures does Boeing need to take to ensure that its values are implemented?