When Microsoft agreed to pay $7.5 billion to buy GitHu b, a massive premium over its previous $2 billion valuation, one person heard about the deal and was angry: GitHub’s former Associate General Counsel, Agnes Pak, as indicated in a new lawsuit filed by Pak.
Pak is suing GitHub alleging that that the company underpaid her in stock and then fired her for asking for equal pay.
Her lawsuit claims that her boss, Julio Avalos, acknowledged that she was “light” on stock options when she first asked him about it shortly after she was hired in June, 2017.
The suit, filed in San Francisco Superior Court on Friday, says he and the company put off her request to level up her stock to what others had received until her annual review in April 2018.
At her review, she received an increase in salary and a hefty cash bonus, but not what she wanted, what she thought she was promised: the stock. Her starting pay was $255,000 per year, and she had been granted 85,000 shares of stock that began vesting after she was there one year.
The pay was fair to better than average for companies about the size of GitHub, according to leaked data from VC firm Andreessen Horowitz published by Business Insider.
But Pak had reason to believe that others at the company with less experience than her had been offered more.
In April, a few weeks after her review, she scheduled a meeting with HR to talk about the stock again and Avalos fired her, the lawsuit alleges. He described her complaints to HR, management and her team about her pay as “unprofessional,” the suit alleges.
Pak also claims that her final performance review was altered after she was fired, with the high marks changed to low ones.
Because she was fired before her first year was completed, she was stripped of all of her stock, her lawyer said.
She’s suing for $20 million in stock – what she thinks she’s owed based on what others were paid -plus punitive damages, which the statute says can be as much as double. She also wants her job back.
“Avalos thought it unprofessional to complain about compensation … so she’s fired?” Pak’s lawyer Adron Beene told Business Insider when asked for comment. “She’s a lawyer. Who is going to stand up against this?”
GitHub has some 1,000 employees and not all of them work out. But GitHub has been caught in turmoil and drama over employees speaking out against its culture for years. Back in 2014, Julie Ann Horvath famously leveled allegations of harassment by management and sexual harassment by a fellow employee that ultimately led to founder CEO Tom Preston-Werner’s resignation.
Cofounder Chris Wanstrath became CEO in Preston-Werner’s wake and Avalos became Wanstrath’s right-hand man. Avalos amassed a lot of power at the company under Wanstrath, rising from top lawyer to chief business officer, running the legal, HR, and finance departments.
In 2016, the company went through another round of turmoil, Business Insider reported at the time, as Wanstrath reorganized the company. He tried to tackle GitHub’s reputation for having an unwelcoming culture head-first, hiring a diversity expert. That expert left in 2017.
Last year, well-known transgender programmer Coraline Ada Ehmke was fired from her job at GitHub and also talked to Business Insider about her frustrating year there, where her personality was constantly being criticized, she said.
In the meantime, Microsoft is working on closing its deal with GitHub.
According to one person knowledgeable with that situation, shareholders including GitHub employees, could soon get a package of papers that includes something known as a “280G.” That’s an IRS rule involving the tax liabilities of highly paid individuals when a company is sold. And it often reveals to shareholders what top employees are paid.
“A ton of employees, a lot of them shareholders, are going to see for the first time how grossly overpaid people are at GitHub,” this person said.
A GitHub spokesperson tells us, “We have not been served or seen the complaint, so we cannot comment.”
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