Activision Blizzard will create an $18 million compensation fund to settle a harassment lawsuit with the Equal Employment Opportunity Commission (EEOC).

The EEOC filed the suit against the Call of Duty and World of Warcraft maker on September 27, 2021, "to correct unlawful employment practices based on sex and to provide appropriate relief to a class of individuals who were adversely affected by such practices."

The 7-page document (spotted by Wired reporter Cecilia D'Anastasio), which is separate to a similar complaint filed against the U.S. publisher by the California Department of Fair Employment and Housing (DFEH), contains allegations of "sexual harassment" and "pregnancy discrimination" alongside a jury trial demand.

The EEOC launched its investigation into Activision Blizzard in September 2018, and indicated the company has been "subjecting female employees to sex-based discrimination, including harassment, based on their gender. Retaliating against female employees for complaining about sex-based discrimination, based on their gender, [and] paying female employees less than male employees, based on their gender."

Although it rebuffed those allegations, Activision Blizzard has proposed establishing an $18 million fund to "compensate and make amends to eligible claimants." It added the settlement would "avoid the expense, distraction, and possible litigation associated with such a dispute."

Notably, Activision Blizzard explained that eligible claimants must have worked at the company since September 1, 2016, and will receive an amount determined by the EEOC. Any cash that goes unclaimed will be donated to "charities that advance women in the video game industry or promote awareness around harassment and gender equality issues."

The agreement, which is subject to court approval, will completely resolve all allegations, issues, and claims raised by the EEOC. Commenting on the matter, Activision Blizzard CEO Bobby Kotick apologized to those who experienced inappropriate conduct.

"There is no place anywhere at our company for discrimination, harassment, or unequal treatment of any kind, and I am grateful to the employees who bravely shared their experiences," said Kotick, who was recently subpoenaed by the US Securities and Exchange Commission as part of its own investigation into Activision Blizzard.

"I am sorry that anyone had to experience inappropriate conduct, and I remain unwavering in my commitment to make Activision Blizzard one of the world’s most inclusive, respected, and respectful workplaces.

"We will continue to be vigilant in our commitment to the elimination of harassment and discrimination in the workplace. We thank the EEOC for its constructive engagement as we work to fulfill our commitments to eradicate inappropriate conduct in the workplace."

Last week, Kotick said Activision Blizzard would be working in "good faith" with regulators to resolve its workplace issues, although those remarks came after the company had initially pushed back against allegations centred around a harmful "frat boy" culture.