Trial lawyers waging war on Walmart

If at first you don’t succeed, try, try, try again. That’s what trial lawyers are saying about the Supreme Court’s Walmart decision, released last week.

Walmart is America’s largest private employer. On Monday, the Supreme Court threw out the class-action lawsuit alleging sex discrimination filed by three current and former employees supposedly on behalf of all 1.5 million current and former female Walmart employees.

The court ruled that the 1.5 million women and the 3,400 Walmart stores — all in the United States — had too little in common to allow a class-action lawsuit to proceed.

The court said that there was no proof that Walmart, which has a stated nondiscrimination policy, had a general policy of systemic discrimination. The Walmart stores had too little in common for a class-action suit.

Individual managers made their own decisions as to promotion, and plaintiffs had not proved that a culture of discrimination existed at the company.

But fees of plaintiffs’ lawyers typically are a percentage of the damages awarded, and so the larger the class, the larger the attorneys’ fees.

Joseph Sellers, one of the lawyers representing women in the case, promised to continue the fight by bringing more class-action lawsuits at the store or regional level.

He told The New York Times that “this case will be splintered into many cases that may take longer and be harder to resolve.”

Walmart has been a target of trial lawyers because its employees are not unionized. Hence, the campaign to prove Walmart treats women unfairly.

Millions of dollars spent on litigation are millions that Walmart cannot spend expanding stores and hiring. And with an unemployment rate of 9.1 percent, more hiring is needed.

Texas, which reformed its state civil justice system in 2003 and just passed a “loser pays” law to discourage frivolous lawsuits, has created 37 percent of all net new jobs in America since the so-called recovery began in June 2009.

The court decision doesn’t mean that large companies can discriminate against women. It does mean that individual women, or groups of women under one supervisor, store or region, have to prove each case on its merits.

Two of the three Walmart employees who brought the class-action suit are unlikely to have won individual sex-discrimination suits.

Betty Dukes, the lead plaintiff, who worked in a Pittsburgh Walmart, had been promoted to manager, but then demoted to cashier and greeter after admitted disciplinary violations.

Edith Arana, who worked in Duarte from 1995 to 2001, was dismissed for violating Walmart’s timekeeping policy. She was told to apply to her district manager when she complained that her store manager was being unfair, but she never pursued the complaint.

Presumably Walmart would not have promoted men under the same circumstances.

The plaintiffs submitted data showing that men were managers in far greater proportion that their representation among employees, and had higher average salaries.

But these averages might not account for differences in jobs, education, time in the workforce or hours worked. The Labor Department reports that about 27 percent of women worked part-time in 2010, compared to 13 percent of men. Full-time female employees work fewer hours than full-time male employees.

These considerations explain some of the male-female differences between average pay and numbers supervisors at some Walmart stores. If more women work part-time, they may not be eligible to be promoted to manager, nor may they want to assume the responsibilities of a full-time position.

Women should be treated on a case-by-case basis, the same as men, despite large fees collected by trial lawyers from class-action suits.

Examiner columnist Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute.

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