Wednesday, June 23, 2004

Wal-Mart and Women

Judge Martin J. Jenkins of Federal District Court in San Francisco has decided that a class action sex discrimination suit against Wal-Mart can go ahead. The suit, which could cover as many as 1.6 million women who have worked for Wal-Mart, is unprecedented in its scale and could create important precedents.

What is it that Wal-Mart will be sued for? According to the six women who filed the case in June of 2001, the retailer discriminates against women in pay and promotion and retaliates against those who complain. The New York Times tells the tale of one Betty Duke, a 54-year old African-American woman who has worked for Wal-Mart for nearly a decade. During this time she kept asking to be promoted, but she said that when jobs became available they were often filled without being posted. Ms. Duke also stated that she was disciplined for returning late from breaks, whereas male employees were not. A year ago her salary was finally raised from less than $9 to $12.53 an hour by a new manager.

The more general statistical evidence argues similar things. According to a study by a statistician hired by the plaintiffs it took women an average of 4.38 years from date of hire to be promoted to assistant manager, when it took men only 2.86 years. To reach a store manager level, women took on average 10.12 years and men 8.64 years. The average salaries of female managers were lower ($89,280 per annum, compared to $105,682 per annum). Hourly workers who were women were also paid 6.7 percent less than those who were men. In a study that compared Wal-Mart to other retailers in the same field the research found that the percentages of in-store managers who were female were 56.5% for Wal-Mart's competitors and only 34.5% for Wal-Mart.

The court case will try to explain the cause of these discrepancies, and perhaps also to account for comments like this from one Wal-Mart manager:

"Men are here to make a career and women aren't. Retail is for housewives who just need to earn extra money."

Of course, the explanation Wal-Mart has will differ from that the plaintiffs support. From the plaintiffs' point of view the explanation is sex discrimination which is still illegal in the United States (though for how long remains unclear if we get another four years of Bush). Wal-Mart will probably argue for societywide explanations that rely on women's lesser interest in being promoted and/or paid more. In other words, Wal-Mart will try to show that the adverse outcomes for women were based on either the women's own choices or societal inculcation of different values in men and women. Anything but Wal-Mart's own actions.

The crucial question in deciding on the most likely explanation in court is the amount of evidence the plaintiffs can gather on actual cases where women were either turned down for promotion when less qualified men were promoted or where women were clearly paid less for the same work. Evidence on retaliation is also important to obtain for the plaintiffs.

Lack of this type of evidence was the reason a similar case against Sears ended in the plaintiffs' loss in the 1980s. The promotion and pay statistics in that case were very similar to those mentioned above, but Sears won the case, largely because the plaintiffs had not gathered enough detailed evidence on actual women who had been denied promotion. Thus, statistical numbers which show that women do worse than men are in themselves not adequate proof of discriminatory behavior on the behalf of the employees. (Sears also had a little help from the judge that was presiding over the case, then a recent Reagan appointee to the bench, as well as from a feminist expert witness on Sears's side whose testimony argued that women are culturally less interested in promotions and higher paying but nonfeminine jobs).

The Wal-Mart case is unlikely to come to court for another year at least, but it's interesting to speculate about its likely outcome. I would argue that the study showing much higher female manager numbers in competitors' stores is pretty bad for Wal-Mart, as this piece of evidence can be used to refute any argument Wal-Mart might make which is based on women's characteristic differences from men in the culture. If other stores had a different experience, then Wal-Mart differences in pay and promotion can't be cultural. Of course, if Wal-Mart judges the likelihood of winning the case as too small, it will probably go for an out-of-court settlement.

Poor Wal-Mart. It is having employee trouble on several fronts at the same time. It is "facing allegations that management bullied staff into overtime without pay and regularly breached child labor laws." It is also examined for the possible use of illegal immigrant contractors, and unions have long been complaining that Wal-Mart is not allowing them to organize its workers.
Well, one reaps as one sows, they say.