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June 22, 2004

Wal-Mart's Prices - Another Reason They Exist

They circumvent building codes. They hire many illegals. They have lousy health coverage for those employees they give health care to (High deductibles, kicks in after six months).

Wal-Mart has also received more than $1 billion in local government subsidies, which while partly understandable, alos partly is not if you
look at the study (PDF).

And don't think the lawsuits only flow toward Wal-Mart. (Link.)

Now, there's this:

Judge Certifies Suit Accusing Wal-Mart of Sex Discrimination
By THE ASSOCIATED PRESS | Published: June 22, 2004

SAN FRANCISCO (AP) -- A federal judge on Tuesday approved class-action status for a sex-discrimination lawsuit against Wal-Mart Stores Inc. that has become the largest private civil rights case in U.S. history.

It could represent as many as 1.6 million current and former female employees of the retailing giant.

The suit alleges Wal-Mart created a system that frequently pays its female workers less than their male counterparts for comparable jobs and bypasses women for key promotions.

...
U.S. District Judge Martin Jenkins took nine months to decide whether to expand the lawsuit to include virtually all women who work or have worked at Wal-Mart's 3,500 stories nationwide since 1998. His ruling makes the lawsuit the nation's largest class action.

In morning trading on the New York Stock Exchange, Wal-Mart shares were down 97 cents, or 1.8 percent, at $53.96.

The ruling is pivotal because it gives lawyers for the women tremendous leverage as they pursue punitive damages, back pay and other compensation.

...
Betty Dukes, one of the women spearheading the suit, said she was paid just $8.44 per hour during her first nine years working at a variety of positions at Wal-Mart's store in Pittsburg, Calif., while several men holding similar jobs but less seniority earned $9 per hour.

In a hearing last September, company attorneys urged Jenkins to allow so-called mini-class action lawsuits targeting each outlet. Wal-Mart contends its stores operate with so much autonomy that they are like independent businesses with different management styles that affect the way women are paid and promoted.

Plaintiffs' lawyer Brad Seligman responded that Wal-Mart stores are ``virtually identical in structure and job duties'' and that the case would only take a few months to litigate.

``There is a high emphasis on a common culture, which is the glue that holds the company together,'' he said.

...
Jenkins decided that the ``plaintiffs present largely uncontested descriptive statistics which show that women working at Wal-Mart stores are paid less than men in every region, that pay disparities exist in most job categories, that the salary gap widens over time, that women take longer to enter management positions, and that the higher one looks in the organization the lower the percentage of women.''

Wal-Mart contends the suit ignores the thousands of women who earn more than their male counterparts and doesn't consider factors that may make one job worth more pay than another.

...
The Wal-Mart spokeswoman said the company is evaluating its employment practices.

``Earlier this month Wal-Mart announced a new job classification and pay structure for hourly associates,'' Williams said. ``This new pay plan was developed with the assistance of third-party consultants and is designed to ensure internal equity and external competitiveness.''
A company should not be absolved after the fact for illegal practices. You can bet there's more to this than Betty Duke, who'se postion we don't know. She's probably, at $8.44, vice president of business operations for the southwest region.