This week's U.S. Supreme Court's decision to block a gender-discrimination suit against Wal-Mart could have a ripple effect in Minnesota and across the country.
Some employment-law attorneys in the Twin Cities say the ruling will likely make it more challenging for employees and consumers to bring forward class-action lawsuits — even in state court, which the ruling doesn't touch.
The justices ruled that 1.5 million female employees at the retail giant could not collectively sue Wal-Mart for what could have amounted to billions of dollars in damages. The women claimed Wal-Mart paid them less and gave them fewer promotions than their male co-workers. The court said if the women wanted to sue as a single class, they would have to provide a company policy that discriminated against all of them.
Marshall Tanick, a Twin Cities employment and class-action attorney who represents plaintiffs, says the decision will make it harder for individuals to sue their employers. Tanick said the advantage of class-action suits is that cases often involve claims that are too small to pursue individually.
"Each person is now going to have to get their own lawyer, they're going to have to spend significant amounts of money to pursue a case, and more significantly, those cases, if and when they come to court, will only take a microscopic look at the workplace," Tanick said. "It'll only look at the individual claim of the person, without seeing the broader picture of how other similarly situated people, in this case, women, have been affected."
In Minnesota, Tanick said state courts have generally been favorable to allowing class-action lawsuits to go forward, but he thinks that may change after this week's Supreme Court ruling, even though the decision technically does not apply to state law.
"Employers and their lawyers will point to this case and use the rhetoric and reasoning of this case, and judges tend to follow the ruling reasoning of the Supreme Court, even in state law cases," he said. Tanick said the ruling is the latest "devastating" blow in a series of recent high court opinions siding against class-action lawsuits.
Attorney Rick Ross, who represents employers, usually finds himself on the other side of labor-law cases. He agrees with Marshall Tanick that Minnesota state courts might be influenced by the ruling.
"It would not necessarily be binding on state court judges, but it would be strong precedent. It would be hard to overcome," said Ross. "From Marshall's perspective, it's devastating because he's a plaintiff's counsel, and it could significantly affect his firm's ability to bring national class action law suits."
But Ross said the ruling doesn't preclude smaller class-action lawsuits from proceeding. He said workers who can show they were being discriminated through a single policy or practice could still band together and sue.
"You could have a class of females who are claiming wage disparity in one particular store," said Ross. "If there's more than 100, or 150, that's a class."
This week's ruling could lead to more individual female employees pursuing legal action across the country.
In the case against Wal-Mart, five women from California were named as plaintiffs. They filed the federal suit on behalf of potentially 1.5 million workers. It's likely that some of those employees live in Minnesota. Those women could go on to pursue lawsuits on their own.
It wouldn't be the first time Wal-Mart workers from Minnesota took their employer to court. In 2008, the company settled a class-action suit filed by four Minnesota women representing about 100,000 workers. The women claimed Wal-Mart forced them to work through breaks without pay.
As part of the settlement, the retail giant paid about $54 million, and agreed to take steps ensuring the wage-and-hour abuses would not continue.