CHICAGO — As part of its $160 million proposed discrimination settlement with black financial advisers, Merrill Lynch has agreed to make sweeping changes that may well change the landscape of Wall Street, lawyers said Thursday in court filings.
The documents filed in US District Court in Chicago come days after lawyers for about 1,200 plaintiffs alleging racial bias announced a deal, which, if approved by a judge, would be one of the largest ever in a discrimination suit.
Among the measures, Merrill will create a leadership council to recommend ways to improve opportunities for African-Americans, commit to interviewing at least one minority candidate when selecting new executives, and agree to consider diversity issues when assessing directors’ job performances.
Arguing the settlement has potential impact beyond Merrill Lynch, the plaintiffs’ lawyers urge US District Judge Robert Gettleman to approve it.
‘‘Class counsel respectfully submits that this case and settlement may well change the landscape of Wall Street as well as discrimination and class action law,’’ one filing says.
Plaintiffs accused Merrill Lynch, one of the world’s largest brokerages with more than 15,000 financial advisers, of steering black brokers away from the most lucrative business. As a result, under a compensation system emphasizing production, the black brokers earned less than their white counterparts.
A distinguishing feature of the settlement is that many black brokers who joined the suit alleging discrimination will stay on at Merrill Lynch, where they will be included in new structures meant to address their concerns, said plaintiff lawyer Linda D. Friedman.
Plaintiffs in civil actions typically quit or are fired long before settlements, but in this case the plaintiffs will be a part of the change, Friedman said.
Merrill Lynch spokesman Bill Halldin issued a statement on Thursday, calling the settlement a ‘‘very positive resolution of the lawsuit filed in 2005 and will enhance opportunities for African-American financial advisers.’’
While it agreed to address issues of diversity in the workplace, Merrill Lynch does not admit any wrongdoing in the settlement. In filings during eight years of litigation, it denied the discrimination allegation and staunchly defended its compensation programs.
‘‘All [financial advisers], regardless of race, are judged by the same metric,’’ one of the company’s filings argued. ‘‘The rule is simple: Produce more, earn more.’’