Class-action suit against Wal-Mart gets court OK
By Amy Joyce
By Amy Joyce
A federal appeals court ruled yesterday that the largest sex-discrimination suit in U.S. history can proceed as a class action against Wal-Mart, which is accused of paying female workers less and giving them fewer promotions than men.
The ruling allows about 2 million women who have worked for Wal-Mart since 1998 to seek compensation for discrimination as a group.
Wal-Mart said it will ask the U.S. Court of Appeals for the 9th Circuit in San Francisco to reconsider its decision. Barring that, the company plans to ask the U.S. Supreme Court to overturn the certification. A lower court originally said the case could proceed as a class action in June 2004, and the company appealed that decision in August 2005.
"We think its analysis is much too deferential to plaintiffs and erred in not taking into account Wal-Mart's evidence," said Theodore Boutrous, an attorney for Wal-Mart. He said the court's ruling does not address the merits of the plaintiffs' claims, but whether the case meets the technical requirements to move forward as a class action.
The 2-1 ruling took no position on the case's merits, but agreed with the lower court that the case Dukes v. Wal-Mart, originally filed by six women in 2001, could proceed as a class action against the retailer.
IMPACT FUND ASSISTS
The lawsuit, which with nearly 2 million women is the nation's largest sex-discrimination case filed against a business, claims that Wal-Mart's female employees receive lower pay and fewer promotions than male employees. But Wal-Mart's lawyers argued that there is no pattern of discrimination.
The women who filed suit are represented by the Impact Fund, a nonprofit group in Berkeley, Calif.
"No amount of PR or spin is going to allow Wal-Mart to avoid facing its legacy of discrimination," Brad Seligman, a lawyer and executive director of the Impact Fund, said in an interview. "Now two courts have ruled this trial should go forward. I expect they (Wal-Mart's attorneys) will attempt to further appeal, but I have great confidence the women will get their day."
A class-action lawsuit allows a small number of plaintiffs to sue on behalf of a much larger group in a similar situation.
The judge in the original case ruled that the attorneys for the six named women presented sufficient evidence for a class-action suit, calling it "largely uncontested descriptive statistics which show that women working in Wal-Mart stores are paid less than men in every region, that pay disparities exist in most job categories, that the salary gap widens over time even for men and women hired into the same jobs at the same time, that women take longer to enter into management positions, and that the higher one looks in the organization, the lower the percentage of women."
WAL-MART TO APPEAL
The company has two opportunities to overturn the decision. It will first both ask the three-judge panel to reconsider yesterday's ruling and ask a panel of more than a dozen 9th Circuit Court of Appeals judges to rehear the panel decision. If the court does not overturn its decision, the company can petition the U.S. Supreme Court.
"And then we have a trial, which is where we think we're headed," said Joseph Sellers, a Washington-based civil rights lawyer who represents the plaintiffs. "What Wal-Mart has tried to do so far is derail the case procedurally. The evidence, we think, is very strong. We have a number of clients who would like to have their day in court."
The company said its stores are mostly run by managers who have autonomy over hiring, pay and promotion. Boutrous argued that decisions by thousands of managers at 3,400 stores during a six-year period were "highly individualized and cannot be tried in one fell swoop in a nationwide class action."
Richard Drogin, a statistician at California State University-East Bay hired by the plaintiffs, said that it took women an average of 4.38 years from the date of hire to be promoted to assistant manager, while it took men 2.86 years. It took 10.12 years, on average, for women to become managers compared with 8.64 years for men. He also found that female managers made an average salary of $89,280 a year, while men in the same position earned an average of $105,682 a year. The results for hourly workers show that women were paid 6.7 percent less than men in comparable positions.