pay discrimination

Supreme Court to Hear Wal-Mart v. Dukes

by Hans Bader on December 8, 2010

in Economy, Employment, Labor, Legal

The Supreme Court voted to hear Wal-Mart v. Dukes, granting Wal-Mart’s petition for certiorari.  The Supreme Court will decide whether a class-action rule designed to allow people to bring claims for injunctive relief based on a uniform policy by a defendant can be twisted into a weapon for demanding billions of dollars in damages over conduct at thousands of different Wal-Mart stores by thousands of different managers.

The Wall Street Journal earlier criticized the 6-to-5 ruling by the Ninth Circuit that the Supreme Court is reviewing. That controversial ruling, Dukes v. Wal-Mart, available here, allowed just six employees to bring a multibillion dollar class action lawsuit against Wal-Mart in the name of 1.5 million other Wal-Mart employees they had little in common with. As the dissenting opinion written by Judge Sandra Ikuta noted, the lawsuit was based on junk science that violated the Supreme Court’s Daubert decision, and let a few employees whose situation was anything but typical sue in the name of countless employees they shared nothing with but gender. The plaintiffs’ lawyers originally sought $450 billion.

The Ninth Circuit’s disingenuous ruling rubber-stamped a national class-action even though Wal-Mart’s hiring and promotions are decentralized and not done on a company-wide basis, and Federal Rule of Civil Procedure 23 says that national class-actions are supposed to challenge a company-wide practice. The Ninth Circuit essentially treated the absence of a company policy (one limiting managers’ individual discretion) as itself being a company policy, twisting the language of the rule inside out.  Its ruling against Wal-Mart flouted longstanding legal rules and principles.

Although the lawsuit will affect employees across the country (and the ultimate verdict may reduce the value of your retirement plan, since the mutual funds in your 401(k) probably own Wal-Mart stock), a verdict will be rendered by a left-leaning jury drawn from the San Francisco Bay Area, since the plaintiffs sued Wal-Mart in one of the most anti-employer judicial districts in America, the Northern District of California.

The Ninth Circuit judges were split largely along ideological lines, with only hard-core liberal judges in the majority, and a dissent joined in by all the moderate and conservative judges (as well as one Democratic appointee, Judge Silverman).

Change Is Coming, To Benefit Trial Lawyers

by Hans Bader on January 8, 2009

in Economy, Legal, Politics as Usual, Regulation

Obama promised change, and it’s already happening, at the expense of the poor, consumers, and small business. ”Regulations set to take effect next month could force thousands of clothing retailers and thrift stores to throw away trunkloads of children’s clothing.” That’s the result of a law championed by Obama and trial lawyers, the Consumer Product Safety Improvement Act, which imposes draconian requirements and penalties on sellers of childrens’ toys and clothing. As a result, used clothing stores for poor kids, like Kid to Kid, are going out of business. Some small toy makers will go out of business, and price increases in children’s toys and clothing will also likely result.

The trial lawyers will score another major victory tomorrow, by obtaining House passage of two bills backed by Obama that will greatly expand the ability to sue employers. One, the Lilly Ledbetter Fair Pay Act, would effectively get rid of the statute of limitations in pay discrimination cases. The other, the Paycheck Fairness Act, would pressure some employers to pay people performing different jobs with very different working conditions the same pay, if the different jobs are predominantly held by different sexes, and the different jobs are deemed comparable based on specified statutory criteria.

Supporters of these bills have relied heavily on false claims about what the Supreme Court held in its Ledbetter decision, which did not adopt, as the bills’ supporters claim, a rigid 180-day deadline for bringing pay discrimination cases. (There is a 3-year deadline under the Equal Pay Act, and the 180-day deadline under Title VII, which is simply one alternative avenue for bringing wage discrimination claims, is not rigid, but is subject to equitable “tolling“). False attacks on opponents of the bill were a staple of the 2008 presidential campaign, which featured TV ads from Obama, and mass mailings by state Democratic Parties, falsely claiming that McCain backed wage discrimination against women, simply because he did not support these two bills. Amazingly, the McCain campaign did almost nothing to counter those attacks.