Image: Walmart
Gene J. Puskar  /  AP
A shopper at a Walmart in North Fayette, Pa., loads her purchases into her car. The Supreme Court is set to begin hearing arguments in a Walmart gender discrimination case involving hundreds of thousands of female employees, current and former, regarding pay and promotions since 1998.
By Eve Tahmincioglu
msnbc.com contributor
updated 3/28/2011 1:52:59 PM ET 2011-03-28T17:52:59

The nation's highest court will hear arguments Tuesday in a case pitting employee rights advocates against corporate America, and the outcome could have a sweeping impact on working women and the work world at large.

The Supreme Court will hear arguments in a gender discrimination case against retailing behemoth Wal-Mart over pay and promotions for some 1.5 million female employees, current and former, dating to 1998. At issue is whether this large group of women should be allowed to proceed with a suit en masse.

With their decision, the high court justices could make it easier for large groups of employees to band together and against colossal companies such as Wal-Mart or make it harder by limiting how many of them can join forces to try to change company policies and extract monetary damages.

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If the plaintiffs win and are allowed to proceed with the largest class-action lawsuit ever,  potentially worth billions of dollars, “it would be an extremely significant victory,” said Sarah Crawford, director of workplace fairness for the National Partnership for Women and Families. A decision for the plaintiffs would send a message to employers about fair treatment for women, she said.

A decision in favor of Wal-Mart, the nation's largest private employer could mean that millions of women, many of them working low-wage jobs, "could go without a remedy for unlawful discrimination," she said.

Advocates for big business are watching the case equally closely. A decision allowing such a massive class action would have a negative effect on large companies, said John Wester, an employment attorney for Robinson Bradshaw & Hinson in Charlotte, N.C.

“Employers across the country would tremble,” he said.

Video: Workers accuse Wal-Mart of sexism (on this page)

The justices won’t actually be deciding whether Wal-Mart, which employs more than 1.4 million workers at 4,000 locations nationwide, discriminated against women. Instead the justices will decide whether to allow the sex-bias case to move forward as one of the biggest class-action discrimination cases ever, representing as many 1.5 million current and former female workers who may have been denied raises or promotions. A decision is not expected until late June.

The size and scope of the group is what worker rights advocates say is so important about the case — and just what business advocates say is the problem.

Betty Dukes, the main plaintiff in the case, has worked for Wal-Mart since 1994 and believes that she was paid less than men with less seniority and that she was passed over for managerial positions. Dukes is one of eight named women in the suit who hope to stand for hundreds of thousands of others who might have been similarly affected.

The claims of bias are pretty egregious. The suit contends the retailer’s corporate culture is “rife with gender stereotypes demeaning to female employees.”

Wal-Mart executives allegedly referred to women employees as “Janie Qs” and business meetings were held at Hooters restaurants, according to a Supreme Court filing. The lawsuit contends that “while women comprise over 80 percent of hourly supervisors, they hold only one-third of store management jobs, and their ranks steadily diminish at each successive step in the management hierarchy.”

In 2009, the Ninth Circuit Court of Appeals agreed to class-action status, but Wal-Mart appealed to the Supreme Court, seeking to dissolve the class and force employees to make their cases individually or in smaller groups.

“This kaleidoscope of claims, defenses, issues, locales, events and individuals makes it impossible for the named plaintiffs to be adequate representatives of the absent class members,” the retailer contends in its case.

But the plaintiffs argue that denying class-action status "would burden the federal courts with potentially thousands of store-level cases."

Such an outcome would make it harder for the plaintiffs to get relief, and for future victims of discrimination to bring successful legal cases, worker advocates argue.

A record number of organizations have lined up on both sides of the case. Among companies supporting Wal-Mart’s move to stop the class-action suit are corporate giants including Costco, Microsoft, Bank of America and General Electric. Lining up on the plaintiffs side are groups including the National Women’s Law Center, the National Partnership for Women and Families, the NAACP, the AFL-CIO and the ACLU.

(Msnbc.com is a joint venture of Microsoft and NBC Universal, which is partly owned by GE.)

Gerald Maatman, an employment attorney with the law firm Seyfarth Shaw who wrote a brief supporting Walmart on behalf of Costco and the Society for Human Resource Management, said the suit is unfair because it’s too big.

“What’s the glue that holds the case together?” he asked. If the Supreme Court decides in Wal-Mart's favor, the case could be restructured in smaller cases, which would be “fair to all concerned," he said.

But that would make it harder for victims of discrimination, argued Fatima Graves, vice president for education and employment at the National Women’s Law Center.

“When you’re able to proceed together as a class there’s a host of benefits that flow from that.”

For example, a larger group provides employees with more protection from retaliation, and it’s often easier to obtain company data as a representative of a larger group.

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What’s really at stake, Graves said, “is the ability to challenge broad-scale practices, rather than doing them piecemeal, especially for low-wage women. This case is going to matter because it will let women know they have the ability to challenge pay discrimination" and it will provide incentive for employers “to take corrective action in the first place.”

Jamie Ladge, assistant professor of management and organizational development at Northeastern’s College of Business Administration, says the case could be a wakeup call for  Wal-Mart and other large employers.

She noted that women now make up a majority of the work force, women are earning more degrees "and women are advocating more for themselves.”

Class-action lawsuits like the one against Wal-Mart can protect all workers and signal to corporate America that “cultures need to change.”

Eve Tahmincioglu writes the weekly "Your Career" column for msnbc.com and chronicles workplace issues in her blog, CareerDiva.net.

Video: Workers accuse Wal-Mart of sexism

  1. Transcript of: Workers accuse Wal-Mart of sexism

    MATT LAUER, co-host: The US Supreme Court this week takes up the largest job discrimination case in American history . More than a million women claim that Walmart discriminated against them in pay and promotions. In a moment we'll have an exclusive live interview with the lead plaintiff in the case. But first, NBC 's justice correspondent Pete Williams has details for us. Pete , good morning.

    PETE WILLIAMS reporting: Matt , good morning to you. This is a huge case, the largest class action discrimination suit ever against the nation's biggest retailer. But the Supreme Court will not be deciding who's right; instead, it will decide if this case can go to trial, or if lumping so many complaints together makes it impossible for Walmart to defend itself. For 25 years Christine Kwapnoski has worked at a Northern California Sam 's Club , owned by Walmart . She says she once asked why a male co-worker got a big raise and she didn't.

    Ms. CHRISTINE KWAPNOSKI (Sam's Club Employee): I was told that he had a family to support. And at that time I also had a family to support. You know, I'm a single mom of two, and they were much smaller at that time. But, you know, I still had to feed them and clothe them and everything else.

    WILLIAMS: She and other women , current and former Walmart employees, are suing. They claim the company gives better pay and bigger promotions to the male employees. Their class action lawsuit now potentially covers more than one and a half million women . Walmart denies that it tolerates any sex discrimination .

    Ms. GISEL RUIZ (Executive Vice President, Walmart): Out in the stores, in the field, even in the home office, you get paid based on your performance. Eighty percent of our department manager work force are made up of women , and department managers play a very important role in our organization.

    WILLIAMS: And the company says the lawsuit is so massive, it's impossible to sort out the legal claims in any fair way.

    Mr. TED BOUTROUS (Attorney for Walmart): It's not just the size of the class, it's the nature of the claims here, that the plaintiffs tried to put every single claim into one big class, every person, every state, every store.

    WILLIAMS: But the lawyer for Christine Kwapnoski and the other women says they'd never get into court if they had to sue for back pay one by one.

    Mr. JOSEPH SELLERS (Attorney for Women Suing Walmart): The average loss per woman in this case is about $ 1100 per woman per year. That's not enough to attract any lawyer in this country today.

    WILLIAMS: But several of the nation's biggest employers -- including GE , part owner of NBC -- urged the court to put limits on class action lawsuits, which

    they claim have become abusive. Matt: Pete Williams . Pete , thank you very much . Betty Dukes is the lead plaintiff named in the lawsuit . Jocelyn Larkin is one of the lawyers representing Betty and the rest of the women in the case. And Gisel Ruiz is an executive vice president for Walmart responsible for human resources . Ladies, good morning to all of you.

    LAUER: Good morning.

    Ms. JOCELYN LARKIN (Attorney for Women Suing Walmart): Good morning.

    Ms. BETTY DUKES (Lead Plaintiff in Walmart Lawsuit): Betty , let me start with you.

    LAUER: Good morning. Good morning, Matt.

    Ms. RUIZ: Good morning. You started working for Walmart back in 1994 . You say you were passed over for promotions on several occasions. What led you to believe this was something more than job performance; that this, in fact, might be companywide discrimination?

    LAUER: Well, as far as companywide, at the time I wouldn't be able to say that. But I did notice in my store -- I've only worked in one store in my 16 1/2 year experience with Walmart , and I did notice in my store as far back as the end of the 1900s that there was a problem with women being promoted and going forth into management in the store.

    Ms. DUKES: Well, your name is now attached to this suit. It has become much larger than you. And potentially, if the Supreme Court rules in favor with the plaintiffs here, over a million women might be involved in this suit. Do you think all of those women were discriminated against by Walmart , or is it important to separate individual cases here?

    LAUER: Well, if we were to do individual cases, we as a -- we as a group of women wouldn't have a possible chance to litigate our circumstances. Economically, we don't have the resources individually is to take on Walmart and go through all of the legal ramification that we would be facing. We've been out now almost 10 years with this case. I would not have survived more than the first year on my own.

    Ms. DUKES: Right. Jocelyn , though, I mean, you know, we're talking potentially 1.5 million women that could be involved in this. I mean, yes, let's say there are a lot of those women who perhaps were discriminated against. But aren't there going to be a lot of women in that case who simply were not? And is that fair to Walmart ?

    LAUER: The way it would work, Matt , is that first we would have a trial to determine if Walmart had a policy of discriminating against its female employees with respect to pay and promotion. If we won, then the could would go about determining which of the women in the company have suffered actual harm as a result of those policies . So it's not the case that -- of 1.5 million women would necessarily recover, but what we would determine is whether, in fact, Walmart has had such a policy in practice.

    Ms. LARKIN: Right.

    LAUER: And we would get the court to put in place practices that would change those practices forever.

    Ms. LARKIN: Let me bring Gisel in here. Obviously, so if it's all about policies here, Gisel , I mean, how do you feel about the policies that were in place at Walmart at the time this suit was filed ?

    LAUER: Walmart has had strong policies against discrimination in place long before the lawsuit was filed . You know, I started with the company in 1992 as a management trainee in Madera , California , and I remember learning about those policies from my store manager . And then over the course of the years, as I've grown with the company , then it became my responsibility to teach those policies . We also have a long history of providing advancement opportunities at Walmart for women . You know, I dreamed of becoming a store manager in four years when I was a trainee.

    Ms. RUIZ: Well...

    LAUER: Go ahead.

    Ms. RUIZ: Let me ask you this. Going back to the policies , did Walmart dramatically change its policies after this lawsuit was filed ?

    LAUER: Mm-hmm. The policies have been in place long before the lawsuit was filed . You know, like many other companies over the years, those policies have continued to change and have continued to become better and better. It's not like other companies where...

    Ms. RUIZ: But did you change in this case because there was a flaw in them, and that -- that perhaps led to this lawsuit ?

    LAUER: No. The policies have been in place for a long time, they're strong against discrimination. And the policies continue to evolve as our work force evolves, as the work -- excuse me -- workplace evolves, as well.

    Ms. RUIZ: Betty , I think it might surprise some people to learn that you still work at Walmart . You're a greeter. Do you think, A, that the policies have changed toward women after this lawsuit was filed ? And B, how has the company treated you considering you are the lead plaintiff in this case that's now headed to the Supreme Court ?

    LAUER: Well, in regards to your first question, absolutely the company has changed their policies tremendously since we filed our lawsuit back in 2001 . In my store there was no known avenue for womens to advance themselves.

    Ms. DUKES: ...we had a no -- basically a no posting situation. We didn't have no inside information as to how we could advance ourselves.

    Right.

    LAUER: But that has changed greatly since we filed our suit over 10 years ago.

    Ms. DUKES: And quickly, how's the company treating you?

    LAUER: I'm being treated respectfully. I'm positive that because I have such media presence and I have such a great legal representation, that on my own I doubt if I would be treated as fairly as I have been.

    Ms. DUKES: All right. And, Gisel , I'm going to give you the last word because it's somewhat two against one here. Are you confident that Walmart can prevail in the Supreme Court ?

    LAUER: You know, we feel like we have strong arguments in this case, and we look forward to presenting them in front of the court tomorrow.

    Ms. RUIZ: Gisel Ruiz , Jocelyn Larkin , Betty Dukes , thank you, ladies. We'll follow this story. We appreciate your time this morning.

    LAUER: Thank you.

    Ms. DUKES: Thank you.

    Ms. LARKIN: Thank you.

    Ms. RUIZ:

Vote: Vote: Should the Walmart discrimination suit go ahead?

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