The Employers' Association

The Employers’ Association (TEA) is a not-for-profit employers’ association, formed in 1939, with offices in Grand Rapids serving the West Michigan employer community. We help more than 600 member companies maximize employee productivity and minimize employer liability through human resources and management advice, training, survey data, and consulting services.

TEA is in the business of helping people. This blog is intended to address human issues, concerns and the things that impact people - be they self-perpetuated or externally imposed. Feel free to respond to the thoughts presented here, for without each other, we are nothing!

Wednesday, June 29, 2011

A LIMITATION OF CLASS ACTION POWERS…




The United States Supreme Court ruled recently that a group of individuals who felt discriminated against by Wal-Mart could not file a class action against their employer. It was determined that each member of the class had to demonstrate an adverse impact by the organization’s misapplication or violation of a stated policy. Two significant issues addressed by this ruling were:

1) A “class” of employees (female in this case) claiming to have similar skills and abilities as male employees claim they were collectively and intentionally overlooked for promotion (or as a group given less pay if promoted) cannot file a claim “for the whole” without specific data proving such a willful act or violation occurred to each individual within the group.

2) A group of individuals cannot file a class action against an employer without citing a specific policy violation in each individual case.

The ruling does not establish Wal-Mart’s innocence, nor does it say that some individuals were not wrongly treated. It does establish that an individual’s claims must result from an organization’s intentional (or unintentional) documentable actions and identifiable demonstrations of acts that are against stated policy. As an employer advocate, though the action was dismissed on a technicality I would say the court “got it more right than wrong” this time.

The Court DID NOT say an individual having documentable evidence of unfair treatment (proof that pay was different than another having the same set of skills and experience or proof that a disproportionate number of males were promoted than were females having the same set of skills or experience, etc.) could not file against an employer for discrimination. The ruling simply clarified that just because you are a member of a class (female in this case) that worked for an organization (Wal-Mart) you should not be able to join a blanket action claiming discrimination without stating the policy that was violated and demonstrating how that violation impacted your potential.

By eliminating the “class action” component of this case the Court extended the period of relief an individual whom was truly discriminated against will experience should they choose to file an individual action BUT dismissed the “me too” additions whom may not have been negatively impacted by any specific action OTHER THAN being “like” the others within the “class action." It establishes that an individual discriminated against due to the willful violation of an established policy has individual recourse BUT will employers take this ruling as an indicator that it is better to make decisions based on the situation rather than to base them on established policy? What kinds of unfair and unreasonable issues would THAT create? Whatever happened to reasonable management exercising ethical judgment in the administration of fair practices for all employees?