Dukes v. Wal-Mart and the Importance of Class Action Lawsuits in Addressing Systemic Sex Discrimination in the Workplace

By Jennifer Clark and Ariane Hegewisch

The Supreme Court heard arguments on Tuesday to decide whether the lower courts rightly certified the one million or more women at Wal-Mart as a class. According to Wal-Mart’s own salary data, women earn on average $1,100 per year less than men, differences that cannot be explained by experience or performance, and women are much less likely to get promotions than men.

An unprecedented number of amicus curiae (or ‘friend of the court’) briefs were submitted to the court, from groups as varied as the Chamber of Commerce, the NAACP, and the American Sociological Association, as well as the Institute for Women’s Policy Research. Below is a roundup of resources that break down what is at stake, not just for the million-plus women affected by this specific lawsuit, but for the country’s ability to address systemic employment discrimination.

New Research

Key to the Wal-Mart case is not just whether the class should be certified, but on which basis it should be certified. The lower courts certified the case on the basis of ‘injunctive relief,’ which asks primarily for changes to personnel policies and practices to prevent future discrimination; it does not ask primarily for monetary damages (although the women would still be entitled to get back pay for any discrimination they suffered).  This approach is what Wal-Mart and its proponents take issue with. They argue that if there was class certification, then the certification should be on the basis of monetary damages—a procedure that requires, as it happens, a much higher burden of proof than certification on the basis of injunctive relief. Wal-Mart also claims that class certification is not necessary in the first place, because if there were discrimination anywhere, Wal-Mart reasons, then it could be tackled just as effectively by each woman suing Wal-Mart on her own.

IWPR's new report on sex and race discrimination in the workplace.

Ending Sex and Race Discrimination in the Workplace: Legal Interventions That Push the Envelope, a new report released yesterday from IWPR, finds otherwise. The report reviews injunctive relief in over 500 court-supervised employment discrimination settlements—also known as consent decrees—involving alleged sex and/or race discrimination in employment. The report finds that class action lawsuits are much more likely than other settlements to introduce changes to make a long term and sustained impact on discrimination. For instance, over 70 percent of certified class action settlements, compared to five percent of other settlements, mandate the introduction of objective and transparent criteria for job assignments and promotions. Lack of posting of promotion opportunities, or of criteria for being admitted to the training programs that were essential requirements for promotions, is a key complaint by women at Wal-Mart. More information on employment discrimination consent decrees are available on IWPR’s website.

Selected Amicus Briefs

In support of the Respondents (Betty Dukes, et al.)

  • Institute for Women’s Policy Research reviews social science literature and research and argues that individual employment law suits hardly ever lead to injunctive relief; and class action lawsuits, because of their emphasis on best practice injunctive relief (changes to employment policies and practices) play a significant role in remedying systemic employment discrimination.
  • National Women’s Law Center and the American Civil Liberties Union, et al., filed a brief arguing that, despite the size of the class, sex stereotypes, and discrimination in the workplace bring up issues that are common to the class of 1.5 million women.
  • American Sociological Association, et al., filed a brief that establishes social science research as a rigorous and valid form of analyzing workplace culture and discrimination, and then argues that social science research has found that corporate policies that allow unchecked managerial decisions can lead to biased decision-making.
  • U.S. Women’s Chamber of Commerce, National Partnership for Women and Families, and California Women Lawyers filed a brief that argues class action lawsuits, while rare, have benefited both employees and employers in promoting systemic reforms that comply with the law and work within corporations’ own needs and existing infrastructures.

In Support of the Petitioner (Wal-Mart Stores, Inc)

  • U.S. Chamber of Commerce filed a brief that argues the Ninth Circuit Court of Appeals decision to uphold the class certification of the 1.5 million women misread the scope of Rule 23(b)(2) in certifying class action lawsuits.
  • Society of Human Resource Management filed a brief arguing that personnel decisions made by individual managers against the backdrop of a larger company-wide diversity policy are not inherently discriminatory.

Around the Web

The National Women’s Law Center argues that Wal-Mart is not too big to be held accountable for employment discrimination. At AAUW, Holly Kearl outlines the basics of why the Wal-Mart case matters. On the National Partnership for Women and Families (NPWF) blog, NPWF Director of Workplace Fairness Sarah Crawford stresses the importance of this case in the efforts to achieve fair pay. On Huffington Post, Martha Burk, director of the Corporate Accountability Project at the National Council of Women’s Organizations, provides some numbers on Wal-Mart’s gender bias.

Jennifer Clark is the Development Coordinator at the Institute for Women’s Policy Research.

Ariane Hegewisch is a study director at the Institute for Women’s Policy Research. Her most recent report is Ending Sex and Race Discrimination in the Workplace: Legal Interventions That Push the Envelope.

New Cop on the Beat: The Consumer Financial Protection Bureau

It has been a year since the passage of the Credit Cardholders Bill of Rights, also known as the Credit Card Act. Along with Wall Street reform and the creation of the new Consumer Financial Protection Bureau, it just might now be easier to avoid financial traps.

By Robert Drago

I’ll admit it: I know more about the ingredients in the food I eat than the fine print governing my credit card. I sincerely doubt that I am alone, and most of the time, this is not a problem. Until financial disaster struck the United States in 2007, I shared with many Americans a presumption that the system is fair and reasonable, and that I did not need to read the fine print.  But it seems that things were getting out of hand.  I’m happy to say that help is on the way.

Prior to passage of the Credit Cardholders’ Bill of Rights and the Dodd-Frank Wall Street Reform and Consumer Protection Act, lenders were increasingly using mountains of fine print to increase charges to credit card holders and other borrowers. If you went over your credit card limit, the bank could simply pay the amount, charge you special fees for having gone over, raise the interest rate on your existing balances, and downgrade your credit score.

Debit cards once seemed like a solution to these problems, since you can only spend what is in a bank account. But in fact banks often allowed cardholders to run overdrafts and then charged extra  fees. Even such apparently transparent words as “fixed rate” or “prime rate” did not necessarily have their common sense definitions, because they could be redefined in any way the bank or mortgage lender pleased – in the fine print.

Lower down the economic ladder, things were often not fair or reasonable. Twenty-nine percent of Americans do not even have a credit card. Some of those individuals are financially solvent, but many are not (not that all credit cardholders are either) and, surprisingly, they have lots of credit options.

Targeting Low-Income Groups Subprime and Subpar Mortgages

Check out a payday lending site, and you will discover how to sign over your car for cash, obtain a debit card that provides cash advances (huh?), get a check cashed the same day, get a payday loan or, if that’s not enough, get an installment loan. If these all sound like such bad ideas, since the consumer ends up paying steep fees and high interest rates, that no one would use them, think again: millions of Americans are living hand-to-mouth and are relying on these services and often going deeper and deeper into debt as a result.

And sometimes unscrupulous marketers target unsuspecting people for higher interest loans when they could have qualified for lower cost loans.  Studies show that in 2006, 61% of subprime home loans went to people who could have qualified for loans with better terms.  Women and people of color had more subprime mortgages at all income levels than white men.

A Better Ally for Consumers

As we go forward from this financial crisis, we need to know what we are and will be paying in interest and fees for any type of loan. And that is where the Consumer Financial Protection Bureau (CFPB) comes in. Under the leadership of Elizabeth Warren, Leo Gottlieb Professor of Law at Harvard University who long advocated for its creation, CFPB is gearing up for full-scale operations in July of this year. The new CFPB will emphasize the value of transparency, of letting the sun shine in, and this will help all of us.

Financial reform is not about making lenders pay for past misdeeds and shenanigans, although some of that perhaps should occur. It is instead the promise of the public knowing what they are getting into when they sign up for a credit card, take out a mortgage, or get one of those debit cards with cash advances.  Individuals and families will have a far better idea of whether they should or should not take on such debt. Those who should not be taking on debt will be more likely to avoid it, and those who should will be more likely to be able to do so with a clear understanding of the costs. Our economy will not recover until consumers feel secure, until they feel like the rules of the financial game are clear and not subject to change without notice. The Consumer Financial Protection Bureau holds the promise of helping to do just that.

The CFPB is one important piece of the puzzle involved in rebuilding our economy, and an extremely important one for women, who have often been a disproportionate share of the victims of poor practices in the industry and of outright scams.

Robert Drago is the Director of Research with the Institute for Women’s Policy Research.

The Gender of Nuclear Disaster

Is it that men tend to engage in reckless behavior while women are more cautious in the face of risk? A new poll shows that women in the U.S. are much less inclined than men to build new nuclear facilities in the country in the wake of the current Japanese crisis.

By Robert Drago

Why would someone build six nuclear reactors 150 miles away from the center of metropolitan Tokyo, putting more than 30 million people in harm’s way?

I could be wrong, but doubt that women were responsible for the decision to locate the reactors in Fukushima. I do not think women are inherently smarter or more responsible than men, but you have to wonder about an apparently male love of reckless behavior when, days after the nuclear disaster began unfolding in Japan (Tuesday the 15th to be precise), polling revealed that a solid majority of American men favored, and a solid majority of American women opposed, construction of new nuclear power plants in the United States.

We could search far and wide for explanations, but the simplest and most obvious is provided by the example of Florence Nightingale. In case you do not know, the barrage of media messages asking us to help victims of the earthquake, tsunami, and developing nuclear disaster in Japan by donating to the Red Cross, involve an organization inspired by Florence Nightingale’s efforts to alleviate the pain and suffering of wounded soldiers in the Crimean War of the 1850’s (the organization was in fact founded by a man). She formalized what was and is often true in modern and not-so-modern societies: Men engage in reckless behavior and women clean up the human wreckage that results.

Consider any vulnerable population in the U.S. today – whether it is infants and children, adults with disabilities, or the elderly who are frail – and you will find women performing most of the carework for these populations. And when anyone performs this work, and carries that level of responsibility, they tend to become a little more responsible in terms of policy options that might put more people at risk for needing care, for being hurt.

I am not engaging in male-bashing here. Today’s American men are doing far more child care and other carework than their forefathers did. I know many young men who are proud of the fact that they took paternity leave when a child was born, and a growing though still small number of dads share child and elder care and housework equally with the women who are their partners. But that is not typical. Once it is, I suspect that the idea of building new nuclear power facilities will strike most men the same way it strikes me – as an act of lunacy.

Robert Drago is Director of Research at the Institute for Women’s Policy Research.

Who Suffers without Collective Bargaining in Wisconsin? Families.

by Jennifer Clark

(Photo by Michele Dickinson/SEIU)

A new development in the Wisconsin union story occurred a couple nights ago when Wisconsin’s Republican state senators discovered a roundabout way, without any of their Democratic colleagues present, to pass a bill that will strip collective bargaining for public sector employees in the state. The state senators took out the “financial” aspects of the bill and voted to strip collective bargaining rights from public sector employees separate from the budget bill.  But banning collective bargaining will have financial ramifications—especially for family budgets.

Collective bargaining allows for workers to negotiate more effectively for things like higher wages and better benefits. Wisconsin’s bill limits collective bargaining over wages and eliminates the power to collectively bargain over benefits and pensions. Without collective bargaining, workers have fewer options for recourse against unfair wages or low benefits, issues women are more likely to face. As has been noted elsewhere, state and local public sector workers are actually paid less than their private sector counterparts, once their qualifications are taken into account, and as we pointed out last week, the majority of public sector workers at the state and local level are women.

Recently, the Wisconsin Women’s Council released a fact sheet showing that a staggering 71 percent of Wisconsin’s women with children under the age of six are working. This means that there are a lot of working mothers in Wisconsin–more than the national average of 60 percent. Not all of them work in the public sector, of course, but the same fact sheet also showed that the 56 percent of state government workers and 58 percent of local government workers in Wisconsin are women, and women exceed 60 percent of the state government workforce in 12 counties.

In a projection for NBC News, IWPR estimated that it will take 45 more years to close the gender wage gap.

In general, lower women’s wages hurt families that rely on their earnings. Women workers still face a stagnant wage gap–regardless of private or public sector employment. But collective bargaining gives women a collective—and thus, effective—voice in wage disputes. In a recent projection for NBC News, IWPR estimated that it will take until 2056—45 years from today—until women’s wages catch up with men’s. The same NBC story noted that women represent the primary breadwinners in 40 percent of U.S. households, underscoring the importance of women’s wages to family economic security.

If this trend to eliminate public sector workers’ collective bargaining power spreads to other states, the bills will have a disproportionate affect on families of color as well. Nationally, more than one in five black workers are public sector employees, compared to 17 percent of white workers. Although black women in the public sector have the lowest wages, the gender wage gap is actually five percentage points narrower in government (81 percent) than in the private sector (76 percent), according to the U.S. Census Bureau.  (The racial wage gap, as it happens, is also narrower in the public sector.) And five percentage points is not insignificant; remember that it has taken about 16 years (since 1993) to narrow the overall gender wage gap by five percentage points.

Families are already facing an uphill battle with the persistent gender wage gap affecting their household finances. In Wisconsin, female-dominated public sector professions will take the biggest hit from the new legislation and many of the women affected will be working mothers. The last thing these Wisconsin families need is one less way to improve women’s wages.

Jennifer Clark is the Development Coordinator with the Institute for Women’s Policy Research.

This post was updated March 11, 2011, at 2:25.

Gay Marriage a Boon to DC’s Economy

By Robert Drago

A year ago today, the District of Columbia legalized same-sex marriage, and according to the Washington Post, the number of marriages soared from 3,100 in the year prior to 6,600 in the year since.  According to a court representative, the number of marriages usually varies by less than 100 from one year to the next, suggesting the increase was mainly due to same-sex couples (the District does not track the gender of marriage partners). In fact, it is likely that the difference of 3,500 additional marriages understates the marriages of same-sex partners, because the national marriage rate has been falling, undoubtedly due to the economic insecurity experienced by millions of Americans in the last few years.

Although you might not know it from media coverage of national politics, the District is a shockingly poor city. A recent IWPR publication reported that the rate of poverty among all black women and girls in the District is 26 percent, and the rate for single mothers is 37 percent. This is a city that needs some help.

Gay marriage can be a boon to the local economy.  Assuming that in 2010, same-sex marriages in DC cost the same as the national average of  $24,000, then gay marriage generated $84 million dollars of additional consumer spending last year.

The Williams Institute has documented the economic benefits of same-sex marriage and civil unions in Colorado and elsewhere. These analyses suggest reasons why the $84 million figure might be overstated  (e.g., purchasing wedding attire or holding wedding receptions outside of the District), but far more reasons why it would be understated – particularly given the high cost of living in Washington DC, and additional spending when wedding guests come in from out of town and stay in hotels, eat in restaurants, and shop.

It might be a coincidence that over a similar time period, Washington, DC saw a net increase of 22,000 new jobs, and was one of only two states to enjoy a decline in the unemployment rate of two percent or more. Then again, maybe gay marriage created some desperately-needed jobs in the District.

Voices for International Women’s Day

By Caroline Dobuzinskis

International Women’s Day is important for a myriad of reasons, but they all add up to one: achieving equality for women. This day calls on us to remember that women still have to achieve equal access to education, employment, health care, roles in government leadership, resources, and income.  Research from IWPR shows that it will take until 2056 for women to achieve pay parity with men in this United States, based on the pace of progress over the course of the past fifty years.

Slowing progress, women continue to dominate professions traditionally done by women, which typically pay less, despite sometimes having higher education requirements. Women now account for over 95 percent of all kindergarten teachers, librarians, dental assistants and registered nurses in 2009. As further evidence of this, women now make up 61 percent of the local government workforce, with the highest number—at 22 percent— working as elementary and middle school teachers.

Today on Twitter, many men and women used their voices to call for change and progress.

The conversation on the significance of International Women’s Day has been spirited. The Ms. Foundation for Women tweeted “We have far to go. U.S. ranks 37th out of 42 highly developed nations in terms of gender equality.” Musician and women’s rights advocate as Oxfam Global Ambassador, Annie Lennox wrote: “Women perform 66 percent of the world’s work, earn ten percent of world’s income and own one percent of the world’s property.”

Some women may not have the opportunity to advocate on behalf of their rights, consumed with finding basics of survival. Médecins Sans Frontières tweeted about its efforts to bring surgery to women suffering from obstetric fistulas, which can be life-threatening when left untreated.

In the political arena, Secretary of State Hillary Clinton announced during the launch of the 100 Women Initiative aired live yesterday on the State Department’s website, “I believe that the rights of women and girls is the unfinished business of the 21st century.” And former civil rights activist, Rep. John Lewis (D-GA) commented on Twitter: “On the 100th IWD, there are still too many women in too many parts of the world who are left out and left behind.”

These are just a few of the statements made today in honor of International Women’s Day. It is inspiring to see such an outpouring of support for women’s issues. This conversation should carry on beyond today as a reminder there is still work to be done.

Caroline Dobuzinskis is the Communications Manager with the Institute for Women’s Policy Research.

Young Americans and Social Security

By Youngmin Yi

Bloggers, policy experts, and politicians are urging young Americans to care more about Social Security, whether they are asking us to love it, hate it, tweak it, or scrap it. But the results are already in: we care.

And if we could have it our way, Social Security would be here forever.

According to findings from an AARP report, the vast majority of people of all ages believe that Social Security is important, including 90 percent of those aged 18-29. A recent Institute for Women’s Policy Research (IWPR) survey confirms this sentiment among young adults: 63 percent of those aged 18-39 don’t support cutting Social Security benefits for deficit reduction and more than 60 percent of the group don’t think we pay enough for Social Security.

People my age (somewhere in my 20s) have grown up knowing and expecting that Social Security will be there for us in the future. Another IWPR report shows just how vital the program is for older Americans. It provides 50 percent or more of income for more than half of all men and women over the age of 65. Social Security also kept over 14 million people over the age of 65 out of poverty in 2009, 60 percent of whom are women.

In the wake of the Great Recession, American households saw their savings, home equity, and investments slip away, leaving many scrambling for resources. Pension payouts and asset values rise and fall with the tumultuous economy, and earnings remain uncertain in the face of high unemployment. But Social Security has remained a steadfast source of income in both good and bad times.

It is clear that Social Security will be important when we face retirement. But as the discussion remains focused on current retirees and deficit projections for future decades, it is easy to lose sight of the fact that the Social Security debate needs our attention now and will affect us – young workers – more than anyone else.

Why is our voice important now?

Some of us already need Social Security.

If you’re like me and my friends, the term Social Security conjures up images of old age and years that lie far ahead. However, as of December 31, 2010, approximately 3.2 million children under the age of 18 were receiving Social Security benefits as children of disabled, deceased, or retired workers. 949,000 disabled children over the age of 18 were receiving benefits, as well. More than a third of Social Security beneficiaries are not retired workers. To some among us, Social Security is not only a promise of security when we are old, it is vital now.

We are already paying for and earning our retirement security.

Take a look at your most recent pay stub. It shows that you have had 4.2 percent of your wages withheld for the payroll tax, and therefore, Social Security; before the December 2010 tax package was passed, that amount was 6.2 percent of wages.  The inflammatory media and disconnected politicians have hammered away at the misguided notion that the exhaustion of the Social Security trust fund means ruin for us all. Their hypocrisy lies in the fact that younger people are told to worry and care about our future, yet policymakers give us even more of a reason to worry by threatening to cut and weaken the very program that would ensure income security for us in old age. Meanwhile, working Americans, including those our age, have been paying into Social Security with the expectation that we will receive the benefits that we have earned when it comes time to claim them.

Young Americans want Social Security to stay and stay secure.

We’ve heard the miscalculated and misrepresented statistics and the apocalyptic fear-mongering about this vital program. Now, it’s time that the naysayers listen to what young people have been saying all along.

Youngmin Yi is the Mariam K. Chamberlain Fellow for the 2010-2011 academic year. Originally from New Jersey, she graduated from Wellesley College in 2010 with a Bachelor of Arts degree in Economics and French.