Google's massive assets are set to be reduced by $2.5 million as the company has already agreed to pay this amount to more than 5,500 employees, as well as to job applicants, who were said to have been impacted by alleged hiring and pay discrimination.

The U.S. Department of Labor revealed that it has reached a settlement with the search engine giant over allegations of "systemic compensation and hiring discrimination" at the facilities located in California and Washington.

The U.S. department's Office of Federal Contract Compliance Programs conducted a routine compliance evaluation and found the disparities in pay, which affects their female software engineers. The said positions were in the Mountain View, Seattle, and Kirkland, Washington facilities.

Aside from the pay disparity in female software engineers, the agency also discovered hiring rate differences that put female and Asian applicants at a disadvantage. This problem was found in the company's Sunnyvale, San Francisco, and Kirkland facilities.

Google will be paying 2,565 female engineers a total of $1,353,052 in back pay and interest. Around 1,757 female engineering applicants and also 1,219 Asian engineering applicants who fell under the "engineering positions not hired" group will be receiving $1,232,000, in back pay and interest.

Aside from the amount to be paid to the impacted female engineers and applicants, the tech giant will also be allocating $1,250,000 to make up for pay-equity adjustments. Totaling the settlement amount, it could reach $3.8 million.

For years, Google management has been in conflict with workers. It can be recalled that more than 20,000 employees had walked out of work back in 2018 in protest to the poor handling of allegations of sexual harassment.

In the early part of January, around 230 employees and contractors also gathered and formed a minority union. From the time the Alphabet Workers Union was formed, it now boasts of more than 800 members, The Verge noted.

Google to pay $2.5 million
Google will pay $2.5 million to female software engineers and Asian applications. Photo: Pixabay

"Pay discrimination remains a systemic problem. Employers must conduct regular pay equity audits to ensure that their compensation systems promote equal opportunity," said Jenny Yang, the director of the office of federal contract compliance programs.

A Google spokesperson gave a statement to The Verge and said that they believe that everyone must be paid based upon the work that they do, and not based on who they are.