Contributors
Sally C. Pipes - Contributor
[Courtesty of Pacific Research Institute]

Sally C. Pipes is President and CEO, Pacific Research Institute [go to Pipes index]

Discrimination Suit Against Wal-Mart Obtains Class-Action Status
Payday for militant lawyers...
[Sally C. Pipes] 7/12/04

On June 22 here in San Francisco, U.S. District Judge Martin Jenkins granted class-action status for a suit charging that Wal-Mart discriminates against women. That is a huge escalation, changing it from a case involving seven women to 1.6 million (current and former employees), the largest class action on record. This is what the plaintiffs’ attorneys wanted but the case is far from over.

As some observers have noted Wal-Mart is experiencing the “Microsoft phenomenon” of size and scope, driving scrutiny and litigation. Founded by Sam Walton of Bentonville, Arkansas, in 1962, Wal-Mart has become the nation’s largest retailer with 1.3 million workers and 3,578 stores. As such, the highly successful company is an obvious deep-pockets target.

As we noted last year, that is why militant attorneys are suing the retailer, and not some local department store. A payoff involving 1.6 million people would be huge and has lawyers panting. Besides its size and success, Wal-Mart is also a non-union operation, attracting the wrath of the feminist organizations like the National Organization of Women (NOW).

Wal-Mart has been named NOW’s “National Merchant of Shame” over labor issues. But if Wal-Mart is such a bastion of oppression, why do so many women choose to work and shop at its stores?

Women comprise 66 percent of Wal-Mart’s hourly workforce and 80 percent of the department managers. The class-action plaintiffs charge that few women move up from there but when the company posted a notice for a management training program, 43 percent of the applicants were women, the same percentage that they promoted. Perhaps many women choose to work at Wal-Mart because it offers profit-sharing and bonus programs, both criticized by unions. Union membership has dropped from 30 percent of the workforce in the 1950s to some 13 percent today.

Wal-Mart also contributes to a 401(k) for its employees, up to two percent of pay, even if the employee chooses not to contribute. The company denies that it discriminates and bases remuneration on position, experience, performance, and other qualifications. But the case against Wal-Mart follows the standard feminist stereotype of women as victims, men as villains, and large corporations as inherently evil.

In this vision, disparities in pay or the number of women in management can only be the result of discrimination and must be rectified by court action or the federal government. Expecting the workplace to conform to politically correct gender and ethnic quotas is to ignore personal differences, effort, and, of course, choice.

Only a small group of women who have worked at Wal-Mart since 1998 are supporting the case. The suit was filed in San Francisco, which makes perfect sense. A suit of this type requires careful judge shopping and the attorneys did their homework well. Judge Martin Jenkins is a Clinton appointee who accompanied his class-action decision with comments about the 50-year-old Brown versus Board of Education decision. That would suggest the judge has already made up his mind on the outcome of the case.

Wal-Mart has appealed Jenkins’s class-action ruling but the appeal goes to the Ninth Circuit, easily the most liberal appeals court in the nation. Wal-Mart could persuade the court to limit the size of the class, possibly separating claims of unequal pay from questions of promotion. If Wal-Mart loses the case, experts predict the case could yield an award of more than $1 billion in back pay alone. This would be double the largest employment discrimination settlement in American history.

As one account of the case astutely noted without the class-action status, the case would be limited to a few individual claims or might even collapse. In reality, the case of every individual woman has a number of variables that are worthy of attention. Many men at Wal-Mart make less than some women at Wal-Mart. Many men do not rise to management, for a variety of reasons. Individual differences, however, do not interest feminists, who force everything into their tired template of gender discrimination.

The lesson for successful companies is that if they want to treat people as individuals, and not members of a victim group or class, they could face a three-pronged attack of greed, feminism, and judicial activism. This, not competition, is what turns the marketplace into a hostile environment.CRO

copyright 2004 Pacific Research Institute

§