Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘Dukes v. Wal-Mart’

Why Wal-Mart Matters, But Perhaps Less Than You Think

Tuesday, June 21st, 2011

David Weisenfeld

The Supreme Court’s landmark decision on Monday in Wal-Mart v. Dukes understandably garnered front-page headlines in the nation’s newspapers. After all, the case was the largest employment discrimination case in history, dwarfing all other competitors by far with its potential to have included more than one-million current and former female Wal-Mart employees.

But in reality, this mammoth pattern and practice class action was decided December 7, 2010. That’s the day the Supreme Court agreed to hear the dispute. The women who brought this 10-year-old case had won every step of the way. In fact, Ninth Circuit Judge Susan Graber said in her 2010 concurrence in one of the plaintiffs’ victories, “There is nothing unique about this case except for its size.”

As it turned out, however, size mattered. There was no direct circuit split on this issue. Indeed, there was no other case that was truly directly on point. So when the Supreme Court decided to wade into the fray, there was no chance it was doing so to pat the West Coast appellate court on the back for a job well done. Instead, the Court was going to place limits on class actions.

Lead plaintiffs’ counsel Brad Seligman fought hard and fought well throughout this ten-year-old litigation. But a case that could have led to billions of dollars in litigation was going to face a difficult hurdle at the nation’s highest court, and it did. The cries that plaintiffs now cannot proceed in employment class actions, however, could be premature.

The Wal-Mart case included hourly greeters, company vice presidents earning six figures, and female employees in all sorts of jobs between those extremes. The claim by the plaintiffs’ attorneys that Wal-Mart provided “unchecked discretion” to its managers was one that swing voter Anthony Kennedy undoubtedly found difficult to square with the allegation that the company had a top-down culture of discrimination emanating from Wal-Mart’s Arkansas headquarters.

In fact, during the oral arguments Justice Kennedy said as much when he wondered aloud what the unlawful policy was. “It seems to me there’s an inconsistency there,” he said. “If it’s standardless and recordless, then why is there commonality?” If there was any doubt as to the outcome, that comment and question put it to rest.

This was less a case of Wal-Mart being “too big to sue” than the majority of the justices wondering how 1.5-million women at 3,400 stores in widely divergent positions could have something in common besides their gender.

The opinion was notably silent, however, about whether or not the retailer had engaged in sex discrimination. And, it leaves open the possibility of smaller groups of employees banding together, ideally from similar job classifications.

Wal-Mart’s attorney Theodore Boutrous said immediately following the decision, “Under [this] ruling, the way we read it, no class can be certified in this case.” But that seems to be more than a bit of hyperbole.

Will it be tougher for plaintiffs to proceed? Unquestionably. And when they do so, the litigation will be much smaller in scope. But the women and those who represent them have vowed to continue fighting Wal-Mart over what they see as unequal treatment. Smaller class actions against other big companies have succeeded before and likely will again. Those cases just need to be more focused than ever on complying with the Supreme Court’s call for commonality among class members.

About the Author: David Weisenfeld served as U.S. Supreme Court correspondent for LAWCAST from 1998 through June 2011. During that time, he covered every employment law case heard by the Court including Wal-Mart v. Dukes, and also wrote and co-anchored the company’s employment law newscasts. In addition, his work has appeared in the American Bar Association’s Supreme Court Preview magazine.

Companies Can’t Discriminate, But Their Managers Can: The Supreme Court Gives Wal-Mart the Win in Dukes Gender Discrimination Class Action Case

Tuesday, June 21st, 2011

Piper HoffmanToday the Supreme Court sounded the death knell for Dukes v. Wal-Mart, the class action lawsuit accusing Wal-Mart of paying and promoting women less than similarly- or less-qualified men. To protect corporations from having to do more to prevent gender discrimination than pop a few politically correct paragraphs into the employee handbook, the Supreme Court resorted to a belabored procedural argument that incentivizes corporations to do as little as possible to prevent discrimination. The five-Justice majority did not rule on whether or not Wal-Mart actually discriminates against women – they didn’t let the case get that far. Instead they shut it down by changing the rules of engagement.

One of the plaintiffs’ central arguments was that Wal-Mart has a policy of leaving promotion and pay decisions to the discretion of individual managers, and that these managers have made discriminatory decisions. If the women suing Wal-Mart had prevailed, every American employer would have been on notice that it is not enough to sit on their corporate hands and allow gender discrimination to take its natural course in this way. Instead they would have had to make it their business to ensure that their managers treated women fairly. But the Court didn’t want that, as the majority feels that “allowing discretion by local supervisors” is “a very common and presumptively reasonable way of doing business.” (In his opinion for the majority Justice Scalia also announces, without citing any evidence, that most managers work carefully to avoid discrimination in their pay and promotion decisions when left to their own devices. That makes it all the more puzzling why the higher one gets in the corporate hierarchy in the U.S., the fewer women there are.)

So the Supreme Court looked to procedure. To bring a case as a class action in federal court, the plaintiffs have to get permission from the judge to proceed as a class. This makes sense: you wouldn’t want someone to be able to file a lawsuit on your behalf without an objective outsider considering whether the lawsuit was in your interest and whether the person filing it would represent you well. To protect you from becoming part of a class action that doesn’t benefit you, plaintiffs have to persuade a judge that they satisfy the requirements of what is known as Federal Rule of Civil Procedure 23 before their lawsuit can proceed as a class action.

One of Rule 23’s prerequisites is that “[o]ne or more members of a class may sue…as representative parties on behalf of all members only if there are questions of law or fact common to the class.” The Wal-Mart plaintiffs clearly alleged common questions of law or fact, including statistical evidence that Wal-Mart pays and promotes men more than women; Wal-Mart’s policy of leaving decisions regarding promotion and (within certain ranges) pay up to individual managers; evidence that Wal-Mart has a uniform corporate culture across its stores; and evidence that Wal-Mart’s culture fosters discrimination against women. These are precisely the kind of “common questions of law or fact” that courts routinely accept as satisfying the Rule 23 “commonality” prerequisite.

The Court used this previously clear “common questions of law or fact” requirement to thwart the Wal-Mart women by redefining the requirement beyond recognition. According to Justice Scalia, “common questions of law or fact” now means that plaintiffs must “demonstrate that the class members have suffered the same injury.” In no universe that I have visited do these two phrases require the same thing.

It’s not clear just how far the Court will take this bizarre new rule. Does “same injury” mean that the plaintiffs must show that every single class member was denied the exact same promotion? Or that each one was underpaid by the same amount? Scalia writes that it does mean that suffering “a violation of the same provision of law” won’t suffice as suffering the “same injury.” This is a remarkable and counterintuitive holding: after this ruling, a group cannot sue their joint employer for violating the same legal right for each one of them. Instead they have to prove that the legal violation harmed them in the same way. This is completely backwards: courts exist to redress violations of the law, regardless of whether those violations cause their victims to suffer in the same or different ways. It is thanks to this procedural backflip that Wal-Mart and other employers can now delegate their way out of being responsible for discrimination in their workplaces.

Arguably before Monday’s Dukes v. Wal-Mart decision, American employers were subject to legal liability if they delegated so much discretion to individual managers that those managers created a pattern of discriminating against women – at least, the four Justices in the minority believe that this was the law. Now employers have every incentive to take their hands off the reins and let managers make pay and promotion decisions based on whatever criteria they choose. This is a major loss for women, minorities, senior citizens, the disabled, and any other group that tends to get the short end of the stick in the workplace. The procedural manipulations required to reach this point have caused a major loss for any group of people that seeks to redress a legal violation through a class action: now each individual will have to pay for legal representation alone and probably forego evidence of violations against similarly situated people. Goliath has won, and it is every David for himself.

This blog originally appeared on PiperHoffman.com on June 21, 2011. Reprinted with permission.

About The Author: Piper Hoffman is a writer and employee-side employment lawyer. She holds degrees with honors from Harvard Law School and Brown University. Hoffman blogs regularly on law and social justice issues at piperhoffman.com.

Employee Rights Short Takes: Wage Discrimination, Race Discrimination, Sexual Harassment and More

Tuesday, May 18th, 2010

Here are a few Short Takes worth sharing:

Sex Discrimination

Ninth Circuit Certifies Wal-Mart Class Action: In Dukes v. Wal-Mart, a decision from the Ninth Circuit Court of Appeals on April 26th, the Court certified a class in a Title VII lawsuit involving 1.5 million women seeking compensation for back pay. The Court remanded the case to the district court for a determination regarding punitive damages based upon several factors set forth in the decision. The next step is most likely a request for the Supreme Court to hear the case. For more about the case, see the California Punitive Damages Blog. For an interesting story about Betty Dukes, the Wal-Mart greeter and lead plaintiff  see the article here from the Huffington Post. This case is reported to be the largest class action in history.

Sexual Harassment

EEOC Collects $471,000 In Sex Harassment Case: The EEOC reported last week that Everdry Marketing and Management paid $471,096 in damages, plus $86,581 in post-judgment interest to 13 victims of sexual harassment. The payout stems from a four week jury trial in Rochester, New York and a Second Circuit Court of Appeals decision which affirmed the award in favor of the plaintiffs. The case involved a prolonged period of physical and verbal sexual harassment of mostly teenage telemarketers by male managers and co-workers at Everdry’s Rochester, N.Y. location including demands for sex, groping, sexual jokes and constant comments about the bodies of women employees. The story presents another example of the widespread problem of teenage sexual harassment in the U.S

Has The Sixth Circuit Had An Attitude Adjustment?

Two cases last month out of the Sixth Circuit  Court of Appeals made me think that attitudes on employment discrimination cases may be shifting.

Summary Judgment Reversed In Race Discrimination Case: In Thompson v UHHSS Richmond Heights Hospital, Inc, the plaintiff was terminated from her position as a food production supervisor when she was told that her position was eliminated in a restructuring. Thompson believed  that she was selected for termination because of her race and filed a lawsuit. The district court granted summary judgment against her. The Sixth Circuit reversed finding that evidence of Thompson’s superior qualifications in comparison to the employee who assumed most of her job duties showed that she was replaced and also showed pretext. In addition, evidence that a supervisor said to “get rid of” certain black employees whom he called “troublemakers,” which the district court gave “little weight,” corroborated accusations of discriminatory behavior according to the Court.

Sexual Harassment Verdict Affirmed On Appeal: In West v. Tyson Foods,Inc. the Court affirmed a sexual harassment award including $750,000 for past and future mental distress, and $300,000 in punitive damages. In addition to great language on damages, the Court also addressed the sufficiency of reporting sexual harassment to one supervisor as constituting “notice” and a “missing evidence” jury instruction from which the jury is entitled to draw a negative inference. The plaintiff, an assembly line worker, was subjected to a barrage of verbal and physical harassment – 10 to 15 times per shift — during her five weeks of employment at the Tyson Foods plant in Robards, Kentucky. The jury awarded more in damages that West’s lawyer requested which the Sixth Circuit both addressed and confirmed.

images: www.hickmankytourism.com

www.reclaimdemocracy.org

*This post originally appeared in Employee Rights Post on May 12, 2010. Reprinted with permission.

About the Author: Ellen Simon: is recognized as one of the leading  employment and civil rights lawyers in the United States.She offers legal advice to individuals on employment rights, age/gender/race and disability discrimination, retaliation and sexual harassment. With a unique grasp of the issues, Ellen’s a sought-after legal analyst who discusses high-profile civil cases, employment discrimination and woman’s issues. Her blog, Employee Rights Post has dedicated readers who turn to Ellen for her advice and opinion. For more information go to www.ellensimon.net.

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