July 27, 2011

Wal-Mart Discrimination Case May Not End Class-Action Suits

A lot has been written about the Supreme Court’s decision on June 21st in Wal-Mart Stores v. Dukes and most suggest the same thing: the decision is going to hamper all class-action discrimination cases going forward. In the case, the plaintiffs argued that Wal-Mart discriminated against 1.5 million women employees because of their gender.

But Connecticut Employment Blog author Daniel Schwartz suggests a more subtle interpretation. The decision may mean the end of mega class action suits, but not the end of all class action suits. He says it may raise the standard for what is a mega class action suit (one the covers an entire company), but keep the same standard for smaller (but still sizeable) groups of employees. The court ruled it would be unfair for an employer to pay damages to such a large number of employees through a formula for damages, when so few of them would actually have to show how much they were injured by the employer.