Gender Discrimination Class Action against Walmart is Struck Down by the U.S. Supreme Court

Gender Discrimination Class Action against Walmart is Struck Down by the U.S. Supreme Court

Can a large group of employees use the Class Action process to sue for discrimination in the U.S.? Yes, they still can, though they face significant hurdles. In a landmark decision, issued on June 20, 2011, the U.S. Supreme Court ruled against a group of present and former Wal-Mart employees who had brought a claim for gender discrimination. The members of the Court split along ideological and philosophical lines. The majority opinion, penned by Justice Scalia, rejected the use of the Class Action process for this type of claim. The Court held that there was insufficient commonality between the various plaintiffs who would be making claims of discrimination.

The plaintiffs were alleging that Wal-Mart’s policy of giving local supervisors discretion over employment matters resulted in a disproportionate negative effect on women who were promoted less frequently than men. Wal-Mart maintained that it had a policy in place banning gender discrimination. It also maintained that its policy of giving supervisors discretion was gender neutral. However, as the minority opinion pointed out, women fill 70% of the hourly jobs in Wal-Mart’s stores but make up only 33% of management employees. The plaintiffs also demonstrated that women are paid less than men in every region of the country in similar positions and that Walmart’s statistics were less favourable than other retailers.

Though the plaintiffs could not point to a specific policy directive that would violate anti-discrimination legislation or a specific person or group responsible for creating the discriminatory results, they were able to show that there was evidence of significant gender discrimination, across the country and it was not being addressed.

The Supreme Court majority rejected these arguments. It was of the view that the plaintiffs were seeking to “sue about millions of employment decisions at once. Without some glue holding the alleged reasons for all those decisions together, it will be impossible to say that examination of all the class members’ claims for relief will produce a common answer to the crucial question why I was disfavoured.” Politically, the voice of the Court majority is heard most clearly in its general assumptions about gender issues. As Justice Scalia writes, “…left to their own devices most managers in any corporation – and surely most managers in a corporation that forbids sex discrimination – would select sex-neutral, performance based criteria for hiring and promotion that produce no actionable disparity at all.” In other words, most of the male managers, who make up 70% of management, are not likely to discriminate in making promotion decisions about others even though the process by which they have been promoted may have been flawed and even discriminatory.

With an entirely different political and philosophical view, the minority naturally saw this issue differently. As Justice Ginsburg writes, “Managers, like all humankind, may be prey to biases of which they are unaware. The risk of discrimination is heightened when those managers are predominantly of one sex, and are steeped in a corporate culture that perpetuates gender stereotypes.” The minority would have permitted the case to move forward as a class action with sufficient commonality found in the issue of whether Wal-Mart’s pay and promotions policies result in unlawful discrimination.

As a result of this decision, litigants alleging discrimination will need to narrow their class definition to be able to rely on a specific policy or decision that affects all of the members of that class. This may well make it extremely difficult for large groups of employees to advance cases of systemic discrimination.

The Canadian legal landscape has a statutory and common law regime that makes Canadian employment law completely different from U.S. law. Although there have been changes to Human Rights legislation across Canada that now permit lawsuits to address discrimination in some jurisdictions instead of complaints with human rights tribunals, we have not yet seen a move to class action discrimination cases of this type.

If this type of case does it make it to the Supreme Court of Canada, it is likely that the decision will be as politically acrimonious among the Court’s members as it was in the U.S., particularly if the current Prime Minister further politicizes the Court by selecting nominees on the basis of ideology rather than competence as the U.S. has done for so many years.

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