Home -> Law Blog Directory -> Labor & Employment Law Blogs -> California Labor & Employment Defense Blog

Labor & Employment Law

: California Labor & Employment Defense Blog

En Banc Decision in Dukes v. Wal-Mart Reviews Class Certification Standards

The en banc decision in Dukes v. Wal-Mart reviews the lower court decision to certify a monster class of 1.5 million women who claim they were systematically discriminated against by Wal-Mart's corporate culture and subjective decision making.   

There's a lot in the decision.  And at times, the 140-page opinion reads like a monastic debate over the number of angels who might dance on a pinhead.  But here are the four main points boiled down about as far as possible:

• A Plaintiff's Challenge to a "Common Policy" Is Sufficient To Justify Certification.  In deciding to certify a class District Courts should evaluate the merits of the claims only to the extent necessary to decide if they raise sufficient "common issues" to justify class treatment.  Thus, the majority rejected the dissent's suggestion that "Plaintiffs must show a common policy of proven discrimination at the class action stage."  Instead, Plaintiffs need only show a "common policy alleged to be discriminatory."    (Emphasis in original). 

 

• The Requisite "Common Policy" Can Be Derived From a Combination of Management Structures and Practices.  The Court seemed to hold that this "common policy" requirement was met by a showing that "Wal-Mart operates a highly centralized company that promotes policies common to all stores and maintains a single system of oversight."   Plaintiffs offered sufficient evidence of "Common Policy" with evidence of: "uniform personnel and management structure across stores;" central "oversight of store operations;" "company-wide policies governing pay and promotion decisions;" "centralized corporate culture;" and "consistent gender-related domestic disparities" in every region of the company.         

 

• Expert Opinion, Statistical Evidence, and Annecdotal Evidence Can All Support An Inference That The Challenged "Common Policy" Could Have Resulted In Discrimination.    A trial judge need not decide if the Plaintiffs expert analysis supported a finding that Wal-Mart managers were actually discriminating.  Rather, the point of expert testimony was to present "scientifically reliable evidence" supporting the existence of a "common question of fact"  -- i.e., "Does Wal-Mart's policy of decentralized, subjective employment decision making operate to discriminate against female employees?"   Likewise, testimony from individuals describing alleged discrimination against them personally also support the inference of a link between the challenged policies and the alleged discrimination.  

 

• A Rule 23(b)(2) Class Can Be Certified Where The Benefit to an Average Class Member from Equitable Relief Will be Greater Than Money Damages. The more lenient Rule 23(b)(2) certification standard applies where "the importance of injunctive and declaratory relief" will be greater than "the amount of monetary recovery available for each plaintiff."  Moreover, where money damages are larger they may be split off and certified under Rule 23(b)(3).  For example, the Court found that claims for back pay were properly certified under Rule 23(b)(2), while punitive damages and claims by former employees (who could no longer benefit from an injunction) would have to be remanded for certification under Rule23(b)(3).        

 

The bottom line is that this en banc opinion gives plaintiffs plenty of ammunition in seeking to have their claims certified for class treatment.  Although its primary impact will be in discrimination cases, the impact will no doubt be felt in other areas such as wage and hour claims. 

 

Full post as published by California Labor & Employment Defense Blog on April 29, 2010 (boomark / email).