Employment Discrimination II

Discussion Topics and Additional Reading for Class 6

Reading (in addition to the readings listed in the syllabus):

Review (from the Class 5 readings), the portions of the Teamsters decision that relate to proving a pattern or practice of discrimination through statistics, and the court’s authority to award prospective injunctive relief: 431 U.S. at 337-342, and 361.

Local 28, Sheet Metal Workers’ International Ass’n v. EEOC, 478 U.S. 421 (1986) (Read the edited version posted on TWEN).  This case concerns the outer limits of the injunctive relief that a court may impose to remedy systemic discrimination.

Excerpts from two articles about diversity initiatives undertaken by Wal-Mart (reprinted at end of this handout).

Discussion Topics and Assignment:

In the first part of class, we will examine the statistical evidence in Dukes v. Wal-Mart Stores.  Don’t let mathphobia put you off.  You can understand and critique the premises of statistical arguments without making any calculations or applying any formulae.  Being  conversant with statistical reasoning is important for lawyers involved in many types of litigation.  (It will also enhance your ability to evaluate the conclusions reached by empirical studies, such as those you read for Class 4).  As you read this portion of the Dukes decision, keep in mind the basic question that both sides’ statisticians are trying to answer:   Are the observed gender disparities in pay and promotions the result of a pattern of discriminatory conduct by Wal-Mart, or can these differences be explained by non-discriminatory causes?  Try to evaluate the strength and weaknesses of the arguments on both sides.

In the second part of class, we’ll focus on whether and how litigation can effectively reform entrenched patterns of discrimination.  Title VII gives a federal district court broad authority to enjoin discriminatory practices and “order such affirmative action as may be appropriate.”  The Supreme Court has stated that when systemic discrimination has been proved, “the district court has not merely the power but the duty to render a decree that will so far as possible eliminate the discriminatory effects of the past as well as bar like discrimination in the future.”  In fashioning prospective relief, a court may also consider a broad array of equitable factors, including whether the employer has already taken effective action to eliminate and remedy the effects of past discriminatory practices (in which case a coercive order might be unnecessary), protecting the rights of third parties, and  avoiding undue interference with a company’s legitimate operating needs.

We’ll explore these issues through a group exercise.  Assume that proceedings in Dukes have been bifurcated into liability and remedy phases.  At the liability trial, a jury has ruled for  the plaintiffs, finding that Wal-Mart has engaged in a pattern or practice of sex-based discrimination in compensation and promotions.  The case is now moving into its remedies phase.  The plaintiffs are seeking two basic types of relief: (1) lost earnings and damages for   class members who were discriminated against in pay or denied promotions1 because of their sex, and (2) prospective injunctive relief to eliminate discriminatory practices and prevent future discrimination.  Before the trial on remedies begins, the district court judge has asked the parties to try to negotiate a settlement.  The judge has also requested that, if no settlement is reached, each side submit to the Court a proposal concerning what the Court’s injunctive order should contain.

Both sides have set up internal working groups of attorneys to develop their proposals.  You are part of a working group that is focusing exclusively on the issue of prospective injunctive relief.  Those of you who sit on the left-hand side in class (as viewed from the front; it would be the right-hand when viewed from your perspective when seated) are attorneys for the plaintiff class.  Those who sit on the other side of the room are attorneys for Wal-Mart.

In advance of class, think about these questions from the perspective of your role:

1.      What are your client’s objectives?

2.      What should your proposal for injunctive relief should contain?²

3.      What sorts of proposals do you anticipate that the other side will make?

4.      Which of those proposals should you oppose, and what can you argue against them?

During the second part of class, we will divide you up into working groups (about six in each group).  Each group will discuss these issues and develop a concrete proposal.  We will then come back together as a class.  Each group will be asked to present and justify the elements of its proposal, and to respond to the proposal made by your opposing counsel. 

From Betsy Morris, et al., How Corporate America is Betraying Women, Fortune, January 10, 2005:

Wal-Mart has gotten religion. The retailer has made big changes to its employee practices that one analyst warns could drive up its operational costs. The far greater consequence, though, may be the standard it sets for the rest of corporate America. Recently Wal-Mart began to tie 15% of a manager's bonus (which can amount to 85% of salary for top executives) to meeting diversity goals. What that includes, explains the company's new chief diversity officer, Charlyn Jerrells Porter, is that the sex and race of those promoted closely reflect the percentages of those who apply. This is not a quota system, she says. Only the most qualified are to be promoted. But if the company is recruiting effectively, "at some point, the stats take over" and the percentages naturally match up. Wal-Mart is also taking another bold, possibly precedent-setting step: It has begun to require that new hires with the same experience receive the same starting pay--no matter what their pay was in the past. (This applies to hourly hires; the company is reviewing changes for salaried types.) Says Porter: "We don't bring a female in at $ 6 and a male in at $ 7, where both have similar prior work experience, because if you do, then you have an immediate issue."

From Karen Donovan, Pushed by Clients, Law Firms Step Up Diversity Efforts, New York Times, July 21, 2006:

The nation's largest law firms, long dominated by white men, have struggled to attract, keep and promote minority and women lawyers.  Now these firms have a powerful incentive to do better: Some of their biggest corporate clients are demanding that they increase the number of minority and women associates and partners. . . .

Wal-Mart Stores has dropped two law firms -- pulling active work from them -- because of unhappiness with the firms' lack of diversity.   ''Both of those firms were performing well, exceeding expectations, in the category of performance and in the category of cost,'' said Thomas Mars, Wal-Mart's general counsel. Wal-Mart has also decided not to send any additional work to several other firms.

Companies that have sought to present a face that reflects the diversity of their customers are keen not to have their lawyers undermine that public image. And companies that have faced racial and sex discrimination lawsuits -- as has Wal-Mart, which is fighting a huge sex discrimination class action -- are particularly sensitive to their law firms' diversity. (Mr. Mars says that Wal-Mart's efforts with its law firms have nothing to do with the litigation against the company.)

The recent corporate effort to push law firms to improve their diversity record began with Roderick A. Palmore, general counsel at Sara Lee, who wrote his peers at the top of corporate law departments to commit themselves to ''end or limit our relationships with firms whose performance consistently evidences a lack of meaningful interest in being diverse.'' . . . 
About 100 companies, including American Airlines, Boeing and General Motors, have signed onto Mr. Palmore's pledge. Yet aside from Wal-Mart, he is hard pressed to cite other examples of companies making good on the threat to fire a law firm for lack of progress on diversity.
The statistics show there is a long road ahead:  Lawyers of color accounted for just 4.63 percent of partners at the nation's major law firms in 2005, according to research by the National Association for Law Placement. And data recently collected by the New York City Bar from 92 law firms with offices in the city show the pace of change is not accelerating much, especially when compared with the numbers for women. In 2006, 7.4 percent of minority associates were promoted to partner, barely up from 7 percent in 2004. The number of women promoted to partner jumped to 29.1 percent in 2006 from 20.4 percent in 2004. . . .

Even those minorities who make partner may find themselves on the sidelines. Samuel M. Reeves, the Wal-Mart associate general counsel in charge of increasing diversity in its outside counsel, came to that realization at a panel in Philadelphia he attended last year, when a black partner at a law firm said that he knew of women and minority partners and associates with not enough work to do.  ''The light bulb kind of went off when I heard that,'' Mr. Reeves said. 

At the top 100 firms who handle Wal-Mart's work, 82 of its ''relationship partners'' -- the lawyers who handle the day-to-day interaction with the company and, more important, assign legal work to their colleagues -- were white males.  Mr. Reeves asked each firm to submit a slate of three to five lawyers for that role, and include at least one woman and one minority lawyer on the list. Mr. Mars also talked with the management at these firms, telling them that the company intended to move its business if the new relationship partner switched firms.  After reviewing the firms' responses, Wal-Mart made 40 changes.  Joan Haratani, a San Francisco partner at Morgan, Lewis & Bockius, was one beneficiary.  ''I was very lucky,'' said Ms. Haratani, who is the first woman of color to lead the San Francisco Bar Association. ''Wal-Mart is leading the charge in adding an accountability component to the business case for diversity.''