Marketplace, March 26, 2011, Saturday

Marketplace

March 26, 2011, Saturday

Marketplace

Wal-Mart faces major class action employee discrimination suit

By John Dimsdale

The suit was filed on behalf of 1.5 million current and former female employees of Wal-Mart, saying the company had a pattern of discrimination in pay raises and promotions.

Kai Ryssdal: The largest employment discrimination class action lawsuit ever lands at the Supreme Court on Tuesday. It involves the largest retailer ever. A suit filed on behalf of 1.5 million current and former female employees of Wal-Mart says the company had a pattern of discrimination in pay raises and promotions.

The question for the Justices goes something like this: Can the individual circumstances of 1.5 million different people really be combined into one coherent class? The answer could affect everything from corporate legal strategy to minority employment.

Marketplace's John Dimsdale reports.


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John Dimsdale: It was on a Monday 12 years ago that Stephanie Odle lost her job at the Wal-Mart in Lubbock, Texas.

Stephanie Odle: I was fired so they could give my job to a male manager who left Arizona on Friday and said, 'I'm going to be the marketing manager in Lubbock.' And I was the marketing manager in Lubbock.

She had worked at nine different stores in three states over eight years by then. So, Odle figures she had a good sampling of the company's attitude toward women workers.

Odle: At the time, I'm thinking, 'Why doesn't he like me? What did I do?' Everywhere, I was thinking, 'What have I done to these people?' I wasn't really putting together how -- is discriminatory the right word? How it was everywhere I went!

Odle got in touch with lawyers who knew other women complaining of similar treatment, being paid less than men and promoted less often. Odle became one of the first plaintiffs in a federal employment discrimination suit against the giant retailer.

The plaintiffs' lead counsel, Brad Seligman, says every woman who ever worked at Wal-Mart is represented in this suit brought by six women.

Brad Seligman: What this case is doing what the civil rights laws and class action laws were meant to do, which is to give people a way to band together so they could have a fair chance of proving their case and making a change so the laws would be obeyed.

Wal-Mart wants the court to throw out the class action, saying men and women at the company are paid and treated equally. Theodore Boutros is Wal-Mart's lead lawyer. He says the six original plaintiffs can't possibly speak for hundreds of thousands of employees.

Theodore Boutros: They sued claiming to represent every employee at every position in every state in thousands of stores for a long period of time. No court has ever recognized a class like that.

The enormous size of this class action is why virtually every major company and business association is backing Wal-Mart. Jonathan Cohn wrote one of the court briefs in Wal-Mart's favor. He says a class of this size means any company would be forced to settle out of court, rather than risk a judgment against it.

Jonathan Cohn: Wal-Mart would be crazy to bet billions of dollars, and that's what's on the line here -- on a single case, a single judge or jury's award.

But Cornell labor professor Kate Bronfenbrenner says letting workers join together in a national lawsuit gives them a fighting chance against corporations with deep pockets. She says this is an important test of workers' rights to prove company-wide discrimination.

Kate Bronfenbrenner: If Wal-Mart loses this, this could make a big difference for women workers, workers of color, low-wage workers that these other companies would step back and say, 'We can't assume that we can get away with this.'

If the Supreme Court dismisses the case, the women can only pursue individual claims. Bronfenbrenner says that will make it much harder to file class action suits against any large corporation.

For her part, plaintiff Stephanie Odle says just the threat of the case she started almost 12 years ago has forced Wal-Mart to improve treatment of women employees.

Odle: We have made a difference. We did do it. I did keep my promise to my now 14-year-old that she's not going to have to go through what I went through.

In Washington, I'm John Dimsdale for Marketplace.