MetLife Warns of Q1 Profit Shortfall; Hit by Discrimination Suit

March 14, 2001

MetLife warned Tuesday that auto and home insurance business losses would drag first quarter earnings below Wall Street expectations. The company said it would again increase rates to help cover costs.

Meanwhile, five women with long careers at the company filed a class-action lawsuit accusing the company of discriminating against women in hiring, promotions and compensation and retaliating against those who complain.

A rise in claims due to adverse weather caused MetLife’s auto and home segment to lose an estimated $22 million in the first two months of the year.

“As a result of this adverse performance in the Auto & Home segment, MetLife currently expects to report first quarter operating earnings per share approximately 5 cents below previous guidance” a prepared company statement said.

Meanwhile, there is no way of knowing what kind of loss could stem from the class-action suit, if any. Kevin Foley, a spokesman for MetLife, told reporters that company officials had not had an opportunity to review the lawsuit and could not comment, adding that the company takes equal opportunity very seriously.

The plaintiffs, however, contend that women account for just 25 percent of MetLife’s approximately 6,000 account representatives and only 7 percent of the company’s 183 managing directors, who are charged with running local offices. And none of the three zone vice presidents or 17 regional vice presidents are women, they said.

The suit, which asserts that MetLife violated federal civil rights laws, as well as New York state and New York City anti-discrimination statutes, seeks unspecified monetary damages and changes in company policy.

All of the women have also filed discrimination complaints with the federal Equal Employment Opportunity Commission.

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