What Happens When You Have No Collective Bargaining
WASHINGTON, D.C. -- Wal-Mart bosses refer to their women workers as "Janie Q's." That's according to lawyers who are representing 1.6 million Janie Q's who are suing the giant retailer for sexual discrimination.
Woman at Wal-Mart face a "classic glass ceiling," the lawsuit says. This case has been headlining its way through the courts since June of 2001. Roughly three months ago, the U.S. Supreme Court agreed to review one major facet of the case--at Wal-Mart's request -- the issue of what constitutes a 'class' of plaintiffs. If Wal-Mart can break the class status of this huge group of women, the massive litigation will shatter into millions of inconsequential pieces.
Whether the class action status of this litigation survives will be determined by June of 2011, when the Supreme Court is expected to rule -- roughly 10 years after the lawsuit was originally filed. But this week, Janie Q punched back. A brief was filed in the Supreme Court in the Dukes v Wal-Mart Stores, Inc case. The women argue that if the High Court overturns the ruling of the lower courts -- which have supported class status for these plaintiffs -- that "45 years of civil rights and class action precedent" will be deconstructed.
Dukes is the biggest legal threat that Wal-Mart has ever faced. The case began with six women who sued Wal-Mart, charging the company with systematically discriminating against hundreds of thousands of female "associates" in Wal-Mart and Sam's Clubs nationwide. The court case bore the name of its lead defendant, Betty Dukes.
In 2004, a judge in the U.S. District Court for the Northern District of California in San Francisco ruled that the case could be certified as a class action lawsuit, and would cover all women workers at Wal-Mart from Christmas of 1998 to the present. Later the same year, Wal-Mart appealed that decision to the 9th. Circuit Court in San Francisco. Arguments by both sides of the case were heard in court in August of 2005, and on February 6, 2007, three judges from the 9th. Circuit Court knocked Wal-Mart back on its heels by upholding the lower court's ruling.
The media called the 2007 decision a "major setback" for the retailer. The Dukes case was turning into the largest gender discrimination case in American history. (In September of 1997, Home Depot settled a federal gender discrimination lawsuit that cost the 'home improvement' retailer a staggering $104 million. But this case dwarfs the Home Depot settlement.)
Wal-Mart immediately announced that it was seeking a second hearing before the 9th. Circuit, and would take the case to the U.S. Supreme Court if necessary. The 9th. Circuit Court said that the lower court had the discretion to decide that class action status made more sense than "clogging" the federal courts with thousands of individual suits over the same issues. "Although the size of this class action is large, mere size does not render a case unmanageable," the federal court wrote.
Wal-Mart's attempt to claim that the size of the class was unwieldy for the company was rejected. Wal-Mart also tried to argue that the rules of class action suits should not apply to them, because its 3,400 stores function as independent businesses, and that the company as a whole does not discriminate against women. Wal-Mart's lead attorney in the case told reporters the ruling was "one step in what is going to be a long process. We are very optimistic about obtaining relief from this ruling as the case progresses."
The Impact Fund of California represents the women who filed the lawsuit. "What this shows is that no amount of PR or spin can avoid the day in court that is coming, and it's time for Wal-Mart to face the music," The Impact Fund explained. "We're confident that the women of Wal-Mart will have their day in court."
In May of 2010, the courts in California ruled in a 6-5 vote that the huge gender discrimination case could proceed as a class action lawsuit. After striking out in the lower courts, Wal-Mart pinned its final hopes on the U.S. Supreme Court. On December 6, 2010, Wal-Mart finally caught a break of sorts: the Supreme Court agreed to hear the Wal-Mart case on the issue of class action standing -- but not on the actual merits of the sex discrimination case.
Wal-Mart issued a terse, four-sentence statement after the Supreme Court decision:
We are pleased that the Supreme Court has granted review in this important case. The current confusion in class action law is harmful for everyone - employers, employees, businesses of all types and sizes, and the civil justice system. These are exceedingly important issues that reach far beyond this particular case. We look forward to the Court's consideration of the appeal.
The team of lawyers representing the plaintiffs said this week:
Wal-Mart is attempting to dismantle the Supreme Court's employment discrimination class action jurisprudence... At issue is whether hundreds of thousands of women who work or have worked in Wal-Mart retail stores...can collectively seek an injunction and lost pay against the nation's largest retailer for discriminatory wages and career advancement.
Oral arguments are slated to begin in Washington, D.C. on March 29th.
If the Supreme Court sides with Wal-Mart, "this would rule out certification of all but the smallest employment discrimination cases -- and that's not what Congress intended," the plaintiff's lawyers say.
The brief filed with the Supreme Court this week claims that Wal-Mart's has no application or posting process for promotions to store management or job-related criteria for setting pay. The giant retailer maintains "highly subjective policies" that are overseen by the Home Office in Bentonville, Arkansas. The brief describes Wal-Mart's culture as being "rife with gender stereotypes demeaning to female employees."
As examples, the plaintiffs say Wal-Mart managers would hold business meetings at Hooters restaurants. Company officials described women as less aggressive then men in seeking advancement. One of the plaintiffs was told that Wal-Mart pays men more because "they have families to support."
The plaintiff's research reveals that women's pay at Wal-Mart is significantly lower than that of male workers in every major job classification across the corporation's 41 regions. Eight of 10 hourly supervisors are women, but only one in three management jobs are filled by women. The higher up one goes on the corporate ladder, the fewer women you will find.
Wal-Mart argues that its female employees are too disparate to make up a single class of plaintiffs, that they are spread out over 170 job classifications, and are not being controlled by one corporate policy, but by the actions of individual store managers at several thousand stores.
Wal-Mart has warned its stockholders that the company could wind up paying out billions if it loses this class-action lawsuit. The U.S. Supreme Court has given Wal-Mart its one final chance to defeat its own employees. If the retailer loses this bet, it will move to settle the case, pay out its billions in wages, and admit to no wrongdoing. The dark cloud that has been hanging over Wal-Mart will either flood the company neck-deep in settlement costs, or blow away harmlessly.
But for the 1.6 million Wal-Mart workers, the individual stakes are even higher. They have spent 10 years of their lives fighting for gender equity against the America's largest private employer. Equal Rights Advocates, one of the plaintiffs' co-counsels, was quoted as saying this week: "This case stands for the collective right of every working woman to be paid what her work is worth. The reality is that without this class action, the working women at Wal-Mart will never have their day in court and all working women across the country will lose."
While public employees fight for their collective bargaining rights in Wisconsin, the Janie Q's of Wal-Mart illustrate what happens to those workers in the private sector who have no bargaining rights at all. They wait 10 years just to have their day in court. The Dukes case would never have happened if the women of Wal-Mart had been part of an organized workforce.
Al Norman's website is http://www.sprawl-busters.com. He has been called "a one-man anti-Wal-Mart cottage industry" by the Wall Street Journal. His most recent book is The Case Against Wal-Mart.