Supreme Court Limits Discrimination Class Actions in Wal-Mart Ruling

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In a major victory for employers, on June 20 the U.S. Supreme Court held that a sex discrimination lawsuit brought on behalf of up to 1.5 million current and former female Wal-Mart employees could not be maintained as a class action. Wal-Mart Stores, Inc. v. Dukes. This ruling will make it much more difficult for plaintiffs’ attorneys to maintain class action lawsuits alleging that a class of employees has been subjected to a “common policy” or practice of discrimination.

In April 2010, the U.S. Court of Appeals for the Ninth Circuit affirmed certification of what would have been the largest employment discrimination class action in history. The class included women employed in numerous positions at any of Wal-Mart’s 3,400 retail stores across the United States at any time since December 26, 1998 who had been or may be subjected to the challenged practices. The plaintiffs argued that although Wal-Mart maintained a formal policy prohibiting gender discrimination and had no express corporate policy against the advancement of women, there was a tacit, unwritten common policy in that (1) the discretion local Wal-Mart managers exercised over pay and promotions led to an unlawful disparate impact on women; and (2) Wal-Mart’s strong and uniform “corporate culture” permitted bias against women to infect the decisions of local Wal-Mart managers.

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