Sex Discrimination Suit Against Wal-Mart Gets Go-Ahead

San Francisco has upheld class-action status for a sexual discrimination lawsuit against Wal-Mart Stores.

The case, brought by a group of seven women accusing the world’s largest retailer of bias in pay and promotion, is set to become the largest class-action employment discrimination suit in U.S. history. Some 1.6 million women have worked in Wal-Mart stores since 1998 and could potentially join the suit.

Just hours after the ruling was handed down Tuesday, February 6, the Bentonville, Arkansas-based retailer announced plans to fight the 9th Circuit Court’s decision, which upholds a 2004 decision to let the lawsuit go to trial. Wal-Mart could pay billions of dollars in damages if it loses the case.

“This is just another step in what will be a very long process, and we are still in the early stages of the case,” said Theodore J. Boutrous Jr., a partner at Gibson, Dunn & Crutcher and lead counsel for Wal-Mart’s appeal. “We are optimistic about our chances for obtaining relief from this ruling as the case progresses.”

Wal-Mart’s attempts to fight the ruling, however, could be an uphill battle, says Elizabeth Lawrence, a partner at San Francisco-based law firm Davis, Cowell & Bowe and an attorney for the plaintiffs.

“The court upheld the original class-action status that was granted in 2004,” she says. “This bodes negatively for any further appeals strategy Wal-Mart may launch.”

According to Lawrence, Wal-Mart does not want the suit to go to trial under class-action status. Instead, the company would prefer each woman who believes that she was discriminated against to file suit as an individual.

“That would clog the legal system because there are hundreds of women who were victims of bias practices,” Lawrence says. “Besides, many of these women barely make minimum wage and could never afford to launch a suit against a big company.”

Wal-Mart says it is not guilty of the charges, and points to recognition it has received for promoting diversity within the workplace. The company was named of the 50 Best Companies for Latinas to Work for in the United States by Latina Style magazine and also ranked in the Top 40 U.S. Companies for Diversity by Black Enterprise magazine.

Despite the accolades, the plaintiffs assert that discrimination took place and say Wal-Mart’s centralized management structure could be one of the contributing factors.

“The company is completely run out of Bentonville,” Lawrence says.

Wal-Mart’s intentions to appeal the ruling didn’t come as a surprise to Lawrence.

“We are disappointed that Wal-Mart has launched legal warfare,” she says. “The time has come for the company to admit there is a problem and try to fix it.”

—Gina Ruiz

For more coverage of Wal-Mart’s people problems, click on these links:

Wal-Mart Answers Its Critics

People Problems on Every Aisle