St. Louis Post-Dispatch, October 28, 2009, Wednesday

Copyright 2009 St. Louis Post-Dispatch, Inc.
All Rights Reserved
St. Louis Post-Dispatch (Missouri)

October 28, 2009, Wednesday

HEADLINE: Ex-A-B exec sues, claims gender gap in pay, roles

BYLINE: By Jeremiah McWilliams jmcwilliams@post-dispatch.com 314-340-8372


BODY:
It was about two weeks before Christmas in 2002. Francine Katz, vice president of communications and consumer affairs at Anheuser-Busch, was meeting with her bosses - Chief Executive Pat Stokes and Chairman August A. Busch III - for a performance review.
Katz said she expressed her disappointment that the brewer had not given her a larger raise after she was promoted to her new job five months earlier and became the first woman appointed to A-B's key strategy committee.

Things got unpleasant, according to Katz. She says Busch and Stokes told her the compensation was based on the market rate for her job, and that they couldn't deviate from that number. Busch added that she was ungrateful and could have received less.
Now, Katz is bent on receiving more. Gone from Anheuser-Busch for about 10 months, Katz - a 20-year A-B vet-eran and once its highest-ranking female executive - filed a lawsuit accusing Anheuser-Busch of gender discrimination and paying her less than her male counterparts. The suit, filed Monday in St. Louis Circuit Court, outlines the meeting seven years ago, along with a number of other stinging charges.

In the suit, Katz, 51, claims Anheuser-Busch pays women less than their male counterparts and encourages a "locker room" and "frat party" atmosphere. She also accuses the brewer of removing responsibilities from women, blocking them from top jobs and important committees and excluding them from informal social networks.

She is seeking lost wages and benefits, and compensatory and punitive damages.
This is from "one of the most A-B-loyal execs we've known," newsletter Beer Marketer's
Insights said Tuesday.

Anheuser-Busch, however, strongly disputed the allegations, emphasizing that the brewer believes in treating em-ployees fairly and that it prohibits discrimination.

Before Katz resigned from A-B, she was "compensated fairly for her roles and responsibilities at Anheuser-Busch and treated in compliance with all relevant laws and internal standards," the company said in a statement.

Anheuser-Busch wouldn't elaborate on the specific allegations.

The lawsuit alleges that trouble has been brewing for some time.

One complaint is that when Katz was promoted in July 2002 to take on the duties formerly assigned to John Jacob, A-B's retiring executive vice president and chief communications officer, she did not get the same salary.

Jacob was paid a base salary of $605,000 and a bonus of $645,000 ($1.25 million total) in 2001, his last year at Anheuser-Busch, according to the suit. By contrast, Katz received $300,000 in base salary and a bonus of $200,000 ($500,000 total) in 2002, her first year in the new position.

Katz received annual raises and bonuses. But by 2007, she still made only 46 percent of what Jacob had earned in 2001, the suit says.

"The magnitude of the difference between what she was making and what her predecessor was making is pretty breathtaking," said Pam Tolbert, professor at Cornell University's School of Industrial and Labor Relations. "Half? Amazing. You would think for a given job, you might adjust on the margin. I've never seen that much of a difference in wages paid for a given job."

The suit also says that in 2008, Katz's base salary and target bonus were less than the base salary and target bonuses of every male member of the strategy committee. Katz said she discovered that she and the only other female committee member - Marlene Coulis, vice president of consumer strategy and innovation - would be the lowest paid committee members in 2008.

Katz said she first learned about the alleged gender gap when Anheuser-Busch filed documents with the Securities and Exchange Commission in connection with InBev's buyout. The Sept. 19, 2008, filing disclosed the compensation of members of the strategy committee.

"It was at that time that I discovered I had been treated differently than my male colleagues both in terms of com-pensation and in the enhanced severance and benefits," Katz said in a statement.

As a result of her lower pay, Katz's enhanced severance package tied to InBev's acquisition was less valuable than her colleagues, according to the lawsuit.

Coulis did not return a phone message. Through a representative, Katz declined to be interviewed.

Katz began her career at Anheuser-Busch in 1988 as an associate general counsel in the legal department.

She took over the company's communications and consumer affairs departments in 2002. That year, she also was named to Anheuser-Busch's top-level strategy committee, a group of 15 to 20 executives. She led the company's alcohol awareness programs and environmental outreach, and was also an aggressive spokeswoman, defending Anheuser-Busch from claims that its caffeine-alcohol drinks appealed especially to minors.

In the lawsuit, Katz claims she repeatedly raised the issue of the unequal pay to several top executives between 2002 and 2007. Those executives included Stokes, August A. Busch IV, Busch III and David Peacock, now A-B's pres-ident.

Katz alleges in the lawsuit that Katz asked "numerous times" to meet with Busch IV - including a formal request on Sept. 12, 2007. Busch, then CEO at A-B, canceled or failed to appear at the meetings, according to the suit.

In December 2007, Katz says she had a meeting with Peacock, who had become her new boss. She told him that she was still not paid what her predecessor made in 2001. Peacock said he would look into her base salary and bonus, but Katz didn't hear from him about the issues after
that, according to the suit.

Before Anheuser-Busch sold itself to Belgian brewer InBev, Katz's attempts to discuss her compensation with bosses "were ignored or met with hostility and misinformation," she said in a statement Tuesday.

In March, Katz filed a charge of discrimination against Anheuser-Busch with the Missouri Commission on Human Rights, the suit says.

Katz said the decision to pursue the claim was not easy, citing her "fulfilling career" at Anheuser-Busch.

"As someone who served as a mentor to many women at Anheuser-Busch, I believe it is important to speak up about the disparate treatment I received," she said.

LOAD-DATE: October 28, 2009