Update: As reported by Eurogamer, a jury ruled in favor of Valve in November 2017.
A former Valve translator has filed a $3.1 million lawsuit against the company, alleging that she faced discrimination, a hostile work environment, misclassification as an employee, and ultimately, wrongful termination.
The suit, available in full on Scribd, claims that the employee's primary responsibility was translating content into Spanish, although she also served as a liaison with law enforcement in Spanish-speaking countries and worked in customer service as well. In 2012, she elected to undergo gender transition surgery, which required a move to Los Angeles. Valve accommodated the request and allowed her to work from home, but only under the condition that she be reclassified as an independent contractor, rather than a conventional employee. Her duties would remain unchanged, however.
At some point after moving to Los Angeles, the plaintiff filed a complaint with Valve's human resources “about their unfair business practice of utilizing people interested in their products to provide translation services for free.” The people in question “worked hours upon hours based on promises that their work could lead to a paid position,” but it never actually did.
Shortly after filing a written complaint about the practice in January of this year, the plaintiff was fired, allegedly because her job was being moved back to Washington. But when she offered to relocate, the suit claims, she was refused.
“The real reason for termination was that Plaintiff was complaining about the hostile work environment and illegal business practices as stated above,” the lawsuit states. Valve was accommodating at first, but the suit alleges that the plaintiff's direct supervisor referred to her in a derogatory fashion, including "as 'it,' which is highly offensive to a transgender person.”
The transgender slurs are obviously the most visibly troubling allegation in the suit, but as Game Informer points out, the claim of misclassification could be what really bites Valve in the ass. The classification left the Plaintiff facing higher tax and insurance rates, and ineligible for unemployment and disability benefits, but it could also expose Valve to some serious unpleasantness courtesy of the IRS. It's not enough to simply declare that an employee is an independent contractor and call it a day; specific guidelines must be met in order for the classification to be valid, and as the IRS website warns, companies who do so with “no reasonable basis... may be held liable for employment taxes for that worker.”
I've reached out to Valve for comment, and will update if and when I receive a reply.