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Enough evidence exists that Morgan Stanley Dean Witter & Co. maintains a glass ceiling barring women from top management levels to support a probable cause finding, the Equal Employment Opportunity Commission determined yesterday. Acting on a complaint filed by Allison K. Schieffelin, a principal of the firm who complained about being passed over for managing director, the EEOC found probable cause to believe that women who had started with Morgan Stanley’s Institutional Equity Division in the firm’s MBA program had been subjected to “a pattern and practice of discrimination because of their sex.” Schieffelin accused the firm of excluding women from golf outings, excursions to Las Vegas and entertainment at strip clubs in New York and other cities. Schieffelin further charged that the firm retaliated against her for filing the complaint with the EEOC. The EEOC found probable cause to sustain the retaliation claim and other issues relating to disparate compensation and the treatment of women. Ray O’Rourke, a spokesman for Morgan Stanley, said the company “emphatically disagrees” with the EEOC’s probable cause findings and “does not practice or condone discrimination of any kind.” If the matter is not resolved through negotiations, both the EEOC and Schieffelin, who reportedly had earned more than $2 million in some years, may well bring federal class actions against Morgan Stanley, charging the firm with sex discrimination under Title VII of the federal Civil Rights Law of 1964. Before any lawsuit is filed, however, the EEOC will attempt to negotiate a settlement with Morgan Stanley. O’Rourke stressed that the company was “eager to meet with the commission” to attempt to work out a “prompt and mutually satisfactory resolution.” Yesterday’s findings were issued after an 18-month investigation by the EEOC, in which the agency obtained a court order to enforce the subpoena it had issued to Morgan Stanley. Though the company’s documents produced during the investigation remain in the exclusive control of the EEOC, Schieffelin’s lawyer, Wayne Outten, of Outten & Golden, said there is, nonetheless, evidence of “widespread discrimination.” He cited the fact that only three of the 50 managing directors in the Institutional Equity Division are female. He further asserted that the highest paying jobs in the unit are held “exclusively” by men, and that no member of the company’s 15 member executive committee is a woman. In addition, Outten estimated that “at least 100″ other women, like Schieffelin had been passed over for top positions in the Institutional Equity unit for less-qualified males in the 14 years since she joined the firm from the Northwestern University Graduate School of Management. Outten said the EEOC “seldom” finds probable cause on a class basis, and in only about 5 percent of all complaints filed with the agency are probable-cause findings issued.

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