A sex-discrimination lawsuit brought on behalf of 1.5 million women who have worked at Wal-Mart, the nation’s largest private employer, was rejected. On Monday the Supreme Court tightened the rules for how a large group of people can join together to sue a company for harm done to them. In the majority opinion, the court set higher barriers for bringing several types of nationwide class actions against a large company with many branches.
It was said that it would be nesessary for lawyers brought a nationwide class action against an employer to offer strong evidence of a nationwide practice or policy that hurt the class. In the case of Wal-Mart, the court wrote that the plaintiffs had not shown that Wal-Mart had nationwide policies or practices that discriminated women.
The essence of the women’s complaint consists in the following: statistics produced by the plaintiffs showed that while women held 70% of the hourly jobs in Wal-Mart stores, just 33% of management employees were women, the higher in the company’s ranks you went, the lower the percentage of women, and the salary gap between men and women hired at the same time for the same job got wider over time.
Justice Justice Scalia wrote, that official corporate policy opposed discrimination and”in a company of Wal-Mart’s size and geographical scope, it is quite unbelievable that all managers would exercise their discretion in a common way without some common direction.” She also noted that accounting the number of women who have risen to senior jobs and management positions at the company, it’s unfair to claim that every one of them was discriminated against.
A professor at Georgetown Law Center Heidi Li Feldman said similar reasoning can make it tougher for plaintiffs to bring a class action against a mortgage lender accusing it of having a nationwide policy of defrauding borrowers. She noted:“A big mortgage broker might say, ‘At the national level, we have policies to abide by all of the rules and regulations that are applicable, and we delegate a lot of discretion to our branches’ .”
Some of business groups filed amicus briefs urging the court to limit class actions, as ruling was widely hailed by them. Robin S. Conrad, executive vice president of the United States Chamber of Commerce’s National Chamber Litigation Center, comments court’s decision in the following way:“We applaud the Supreme Court for affirming that mega-class actions such as this one are completely inconsistent with federal law”.
And then added:“Too often the class-action device is twisted and abused to force businesses to choose between settling meritless lawsuits or potentially facing financial ruin.”[via The New York Times, USA Today and Kansas city]