Wal-Mart suit shows glass ceiling still an issue

A lawsuit against America's largest employer is serving as a reminder that concerns about gender discrimination persist, despite four decades of focus on equal workplace rights.

Wal-Mart hasn't been found guilty of sex discrimination – and it may never be, in part because class-action cases on this issue are often settled out of court.

But the very fact that such a large case against the retailer has made it this far – with a federal appeals court giving the go-ahead Tuesday for a class-action lawsuit involving more than 1.5 million women – puts the issue back in the national spotlight more than at any other time in recent years.

The case revolves around wage issues – equal pay for equal work. But it also alleges that Wal-Mart shortchanged female employees on opportunities for promotion.

It's that issue – the proverbial glass ceiling – that studies find is the most intractable gender inequity in US industries today, despite the gains women have made since the equal-rights era.

"There actually has been tremendous progress.... Women are so much more visible," says Vicky Lovell of the Institute for Women's Policy Research, a nonpartisan research group in Washington. "Yet we do see [discrimination] continuing."

The issue matters not just for women but the whole economy, because the underlying question is whether businesses are making the most productive use of the talent available. Gender discrimination represents a failure involving nearly half the workforce.

Women face a significant gap with men in promotion opportunities, according to research published last year by Cornell University economists Francine Blau and Jed DeVaro.

Their data covered 3,500 employers in four US cities. The study found that 10.6 percent of men had received promotions during a four-year period versus 7.6 percent of women – a gap of 3 percentage points.

Even after sifting out a range of possible explanations, including education, skills, and seniority, that gap narrowed a bit, but the promotion rate remained 2.2 percentage points apart.

Interestingly, this study, which drew on survey data from the 1990s, found no solid evidence that those women who were promoted got smaller pay raises than men.

But some experts say that important pay gaps remain – albeit not as wide as those that existed four decades ago.

"Comparable worth ... remains a very big question," says Ms. Lovell. She says this isn't just getting the same pay for the same job, but equalizing pay scales across different careers that are comparable in skills and other respects.

In the Wal-Mart case, the plaintiffs allege more basic concerns that the company failed to pay the same rate for women as men in the same jobs.

"I was layaway manager, getting $7.50 an hour" in Vacaville, Calif., says Patricia Surgeson, one of the plaintiffs in the lawsuit. When the company moved her to a new post in the cashier's office, her replacement made nearly twice that much, she recalled in an interview this week.

She also says Wal-Mart made it hard for her to find out about opportunities for promotion. "They would never post the [open] management position," she says. Eventually, in 2001, she left the company and worked as a manager in a clothing store.

It remains to be seen whether the details of her experience, and those of other plaintiffs, are borne out in a court of law. The Ninth Circuit Court of Appeals, which ruled 2-1 to allow the suit to go forward, said it had no position on those claims, stressing that the decision only affirmed a US district court's ruling to certify Dukes v. Wal-Mart as a class-action suit. Wal-Mart, which says it did not discriminate against its female employees, has several legal options.

But the case hints at the factors – some of them unconscious assumptions by both men and women – that makes a gender gap persist even after years of consciousness-raising and diversity workshops.

Ms. Surgeson says her bosses often assumed she wasn't interested in jobs that might require her, as a young mother, to relocate. They would say "you have a family, you can't do that," she recalls.

Some experts say the pay gap may involve factors other than overt discrimination. But many say it's in companies' interest to devote more top-level leadership to the issue.

"If we're going to be competitive, we can't afford to lose women's talent" by failing to promote them on their merit, says Sharlene Hesse-Biber, a Boston College sociologist and author of "Working Women in America: Split Dreams."

Wal-Mart says it will challenge Tuesday's ruling by asking the Ninth Circuit to rehear the case. "The panel's decision contradicts numerous decisions from the Supreme Court and the Ninth Circuit itself," attorney Theodore Boutrous Jr., Wal-Mart's lead counsel for the appeal, said in a statement. "The plaintiffs' lawyers persuaded the panel to accept a theory that would force employers to make decisions based on statistics, not merit, and would deny employers their basic due process rights."

Critics of the class-action suit also question, among other things, the unprecedented scale of this workplace gender-rights case.

"It's basically extortionist," Robin Conrad, a vice president with the US Chamber of Commerce, told the Associated Press. If it stands, she said, it likely would force Wal-Mart to settle out of court than risk losing at trial.

Most large discrimination cases are settled out of court. Home Depot settled a sex-discrimination class-action suit in 1997 for $104 million. That same year, Publix Super Markets paid $81.5 million for discriminating against female workers.

• Wire services were used in this report.