Sterling Jewelers Under Fire For Sexual Harassment, Signet Stock Plunges

World News
02/03/2017 10:00

Hundreds of former employees of Sterling Jewelers, the multibillion-dollar conglomerate owned by Signet - the largest specialty jewelry retailer in the US, UK and Canada, with about 3,600 stores under brand names such as Kay Jewelers and Jared The Galleria of Jewelry - claim that its chief executive and other company leaders presided over a corporate culture that fostered rampant sexual harassment and discrimination, according to arbitration documents obtained by The Washington Post. Declarations from roughly 250 women and men who worked at Sterling, filed as part of a private class-action arbitration case, allege that female employees at the company throughout the late 1990s and 2000s were routinely groped, demeaned and urged to sexually cater to their bosses to stay employed. Sterling disputes the allegations.

Signet/Sterling issued a press release on Monday (Feb. 28) stating, "The distorted and inaccurate picture of our company presented in these allegations does not represent who we are," adding that, "they are not substantiated by the facts and certainly do not reflect our culture.” Signet said none of the 69,000 members of the case have brought legal claims forward of sexual harassment or impropriety. The arbitration case solely focuses on whether those women have suffered discrimination in pay and promotions, it said. The company added that the allegations “involve a very small number of individuals” and that “many allegations go back decades.”

Signets' shares plunged nearly 13 percent Tuesday; their stock fell more than 8 percent before the company halted trading and issued a statement, yet after trading was resumed, the stock continued its decline, hitting a four-year low. Signet's shares have already tumbled in the last year by allegations of gem swapping at its Kay Jewelers stores in May 2016, charges it denied, and by declining sales. Comparable sales fell 4.6% during the crucial holiday season, a decline Signet partly blamed on a faulty website, but that analysts said was caused by how much of its jewelry is bought on credit. What's more, Signet's ill-fated 2014 acquisition of Zale Corp has proved difficult for the once-high flying company to digest. 

The arbitration was first filed in 2008 by more than a dozen women who accused the company of widespread gender discrimination. The class-action case, still unresolved, now includes 69,000 women who are current and former employees of Sterling, which operates about 1,500 stores across the United States. Most of the sworn statements were written years ago, but the employees’ attorneys were only granted permission to release them publicly Sunday evening (Feb. 27). One of the original women who brought the case, those lawyers said, died in 2014 as proceedings crawled on without resolution. The statements allege that top male managers, some at the company’s headquarters near Akron, Ohio, dispatched scouting parties to stores to find female employees they wanted to sleep with, laughed about women’s bodies in the workplace, and pushed female subordinates into sex by pledging better jobs, higher pay or protection from punishment.

(Photo: Getty images)