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A Frat Party Gone Bad at Anheuser-Busch

November 11, 2009

The former chief spokesperson for Anheuser-Busch has filed a lawsuit charging the beer giant with employment discrimination and alleging that the company’s “locker room and frat party” corporate culture “adversely impacted female managers…and created barriers to their advancement based on their sex.” The lawsuit by Francine Katz seeks back pay and compensatory and punitive damages.

It comes as no surprise that a company responsible for decades of sexist, tasteless, and disingenuous marketing campaigns would engage in illegal discrimination against women employees. But the suit did surprise some, as it comes from a woman who vehemently defended Busch for decades against charges ranging from sexism and homophobia to manipulating college drinking games to marketing caffeine-spiked alcoholic drinks to teens.

At the end of 2008, Katz left Busch after twenty years with the company. She was hired as an associate attorney in 1988, and by 2002, she was a VP and was promoted to Chief Communications Officer, becoming the first women to serve on the company’s Strategy Committee.

Her lawsuit alleges that when she met with CEO Patrick Stokes and Busch Chair Auggie Busch III following her promotion, she complained about her lower salary, which was less than half of what her predecessor in the position was making. In reply, she claims that the two men asserted that her pay was based on market rates and that they had “no discretion” to increase it. But she later found out “from an executive with intimate knowledge of Anheuser-Busch’s compensation policies” that salaries for Strategy Committee members were routinely paid above market rates and that the CEO had wide discretion on salaries. Katz also learned from a 2008 SEC filing following the purchase of Busch by the Belgian beer maker InBev that she was the lowest paid member of the Strategy Committee.

Katz also alleges that Auggie the Third called her ungrateful and suggested her pay could have been lower. She also claims that when Auggie IV became her supervisor, he repeatedly ignored her formal requests to discuss her compensation. After five years, her salary was still just 46% of what her predecessor made in the position.

Ironically, the man Katz replaced as chief spokesperson at Busch, John Jacobs, was at the time of his retirement in 2002 the company’s top African American executive. At least one observer noted that Busch valued the “name and goodwill” that Jacobs brought to the job of chief spokesman as a former Urban League President.

Some say that the $500,000 annual compensation that Katz took home and the $12 million she made from stock options after the InBev acquisition make her an unsympathetic victim. But others have cheered her on: as another former Busch employee noted, “As a woman working more than two decades at Anheuser-Busch, I can attest that the glass ceiling for professional women was well known.”

It seems clear that the Bud Boys treated Katz like a second-class executive while the company enjoyed the benefits of having a women disarm criticism of their sexism. It’s also clear that Katz, while understandably unhappy with the discriminatory treatment, spent years defending Busch’s horrid and hypocritical marketing — and she seemed happy to do it. As she stated in an interview just a year before leaving the company, at Busch “I’ve gotten to go to a Rolling Stones concert, gotten to fly on the company jet, and I’m getting free beer…but what makes Anheuser-Busch such a great place to work are the people. Anheuser-Busch is a company that attracts a certain breed of people who work hard and know how to have fun.”

Perhaps a wise judge could reach a Solomonic decision by finding in favor of Katz and awarding all damages to the lower-tier women workers at Busch who surely have suffered more than she from the company’s sexist culture.

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