From the Washington Post today:
Costco Is the Latest Class-Action Target
Costco Is the Latest Class-Action Target
Lawyers' Interest Increases in Potentially Lucrative Discrimination Suits
By Brooke A. Masters and Amy Joyce
Washington Post Staff Writers
Wednesday, August 18, 2004; Page A01
A wave of high-profile, class-action lawsuits and settlements this summer has raised allegations of race and sex discrimination in pay and promotion at some of the nation's best-known corporations, a list that expanded yesterday to include retailer Costco Wholesale Corp.
Last month, investment bank Morgan Stanley agreed to pay $54 million to settle claims that it underpaid and did not promote women. A few days later, aircraft manufacturer Boeing Co. agreed to pay up to $72.5 million to settle similar allegations. That same month, a group of black employees sued Eastman Kodak Co. accusing the company of systemic race discrimination, and an Alabama judge held a hearing on an ongoing race discrimination case against BellSouth Corp.
In June, a federal judge ruled that a sex-discrimination case against Wal-Mart Stores Inc., the nation's largest retailer, could proceed as a class action involving as many as 1.6 million women, although Wal-Mart has persuaded an appeals court to review the ruling. Gaithersburg food-service giant Sodexho Inc. is scheduled to go to trial in November over accusations that it failed to promote black managers.
The prominent cases are rooted, in part, in 1991 civil rights legislation that allowed victims of employment discrimination to seek punitive and compensatory damages, according to academics and lawyers who represent both employers and employees. The change makes such lawsuits potentially more lucrative for law firms, which have begun building the expertise to pursue them.
The discrimination cases come from all over the country and make a variety of claims, but some common threads run through them. The claims tend to focus on pay and promotion rather than hiring, they rely heavily on statistical evidence of race or sex disparities, and so far, most of them haven't gone to trial. In most cases, either the employer wins when a judge or an appeals court refuses to allow the case to go forward as a group action or the employees win when the class is certified and the two sides settle.
(snip)
Myself, I think this is a fabulous development. The reason a huge gender pay gap still exists in this country, despite 40-year old laws like the Equal Pay Act, is because no one has been holding employers' feet to the fire to do the right thing.
As a result, progress has been excruciatingly slow.
I am hoping lawsuits like the recent ones against Costco, Wal-Mart, Morgan Stanley, etc, will finally kick the bad apples in corporate America into gear and make them realize that they can't get away with this kind of behavior any longer.
I hope that is not merely wishful thinking.
What does everyone else think about these developments?
--Peter