Report Warned Wal-Mart of Gender Discrimination Problems in 1995Jun 4, 2010 | Parker Waichman LLP
Wal-Mart Stores was warned by lawyers in 1995 that disparities in pay and promotions were leaving the company vulnerable to a gender discrimination suit, according to a report in The New York Times. Just six years later, Wal-Mart was named in just such a lawsuit.
That lawsuit, Dukes v. Wal-Mart, was filed by seven women in 2001 on behalf of all women working at the company. In April, the 9th Circuit Court of Appeals in San Francisco voted 6-5 to affirm a federal judge’s decision to award class-action status to potentially one million women or more, making it one of the biggest class-action lawsuits in history.
Dukes v Wal-Mart alleges that the company systematically denied women workers equal pay and opportunities for promotion. Some women said the were paid less than men doing the same jobs, although they had equal or less experience. Others said men who had been at the company less time were promoted into manager positions they were denied.
According to The New York Times, a report prepared for Wal-Mart by an outside law firm in 1995 found similar problems with the way the company paid and promoted employees at both Wal-Mart and Sam’s Club stores. For example, it found that men employed by Wal-Mart as department managers, an hourly position, earned 5.8 percent more than women in those positions in 1993 ($236.80 versus $223.70). Men in salaried jobs earned $644.20 a week compared with $540.50 for women.
It also found problems with the way jobs were assigned, the Times said. For example, 55 percent of women were initially hired as cashiers compared with 12 percent of men. By contrast, 29 percent of men were initially hired in higher paying receiving jobs like unloading, compared with 7 percent of women.
The law firm found that the disparities were “statistically significant and sufficient to warrant a finding of discrimination unless the company can demonstrate at trial that the statistical disparities are caused by legitimate, nondiscriminatory factors.” It recommended that Wal-Mart take some basic steps, including document applicants’ job preferences, post notice of all openings and training opportunities, establish promotion goals and timetables for women and minorities, and monitor progress, to address the problem.
According to The New York Times, company documents and depositions in the lawsuit suggest Wal-Mart’s implementation of those recommendations was “fitful and incomplete.”