FEMALE executives at Merrill Lynch say they have to endure a macho culture “contaminated” by schoolboy humour and sexual gibes.

One senior woman, who left the US-based investment bank last year, said: “Sexist remarks were made routinely. The men would misunderstand you on purpose and give your words an innuendo. That was just the way people talked to each other. I have never come across it to that extent anywhere other than Merrill Lynch.”

She added: “Unless you joined in you were not one of the gang. It was schoolboy humour. All they talked about was sex.”

Women on both sides of the Atlantic have spoken to The Times, on condition of anonymity, about their experiences at the firm, which has faced twice as many sex discrimination claims as its rivals in the past five years.

Merrill Lynch, which last night denied it discriminates against women, saying the claims were due to a recent round of redundancies, is currently fighting multimillion-pound claims brought by Stephanie Villalba, 42, a senior banker, and Elizabeth Weston, 29, a solicitor.

In America last month it settled a ten-year battle with 1,000 of its female brokers who claimed it had a culture of bias against women.

Female executives described a male-dominated work environment where women fail to reach the highest positions and are forced to tolerate sexist language or be excluded.

An executive who brought a sex discrimination claim against the bank in 2001 said: “It is a very tough culture. It is an aggressive, cold and results-oriented organisation. It was exceptionally difficult for women. The women still working at Merrill Lynch are terrified to talk about it.”

The bank confirmed last night that it had defended twenty one claims in five years but said most were spurious or due to the odd bad apple. It said in a statement: “Our belief is that our employees have to be respectful of each other. This is representative of what Merrill Lynch stands for — a workplace in which people can succeed on merit. We are not naive, however, and understand human nature being what it is that from time to time we are going to encounter unacceptable behaviour and discriminatory attitudes.

“When we do we take whatever steps are necessary to remedy these problems: discipline offending individuals strongly, be upfront about these problems and learn from that experience.”

Some women in the City blame the tribunal actions and the big pay-outs for scaring banks from recruiting more women. They also suggest some tribunal claimants were being advised to “throw in” a sex discrimination allegation with other complaints because there is no cap on payouts.

The long-running class action against Merrill Lynch in America began ten years ago when a broker, Mary-Beth Cremin, complained she was being pushed out because she was pregnant. When the firm failed to act on her complaint she sued them. Other women came forward with similar complaints and the action snowballed until the bank faced 1,000 lawsuits.

It has already paid out hundreds of millions of dollars in settlements. A panel of arbitrators ordered the firm to pay one banker, Hydie Sumner, £1.2 million. It ruled that Merrill Lynch had discriminated against her, had consistently paid women brokers less than men and had blocked them from promotion.

Ms Sumner, who worked for Merrill Lynch until 1997, told The Times: “It was a very hostile work environment. There were jokes and inappropriate comments. It is really like they do not want women there.

“Once you complain you are labelled a troublemaker. Then they either fire you, look for some way to hang you out to dry or make your life so miserable it is very hard to work.”

A top employment lawyer said: “Merrills can’t keep writing out cheques. It will be interesting to see what happens with these contested cases.”

On Wall Street the bank has started to clean up its act after the big payouts hurt its bottom line, the lawyer who represented the 1,000 women claimed. But Mary Stowell added: “They still have a shockingly low percentage of women brokers and a number of our clients who are still employed at Merrills feel they are being treated unfairly.”

SEX CLAIMS

Number of discrimination claims among British staff, 1999-2004:

21: Merrill Lynch (out of 5,000 staff)

12: Credit Suisse First Boston (5,000)

10: Goldman Sachs (4,500); Deutsche Bank (7,000)

4: JP Morgan Chase (10,000); Morgan Stanley (5,500); Schroder Salomon Smith Barney (4,500)

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