Time to Review Your Employment Practices

Coverage of the Supreme Court’s 2011 decision in Wal-Mart Stores Inc. v. Dukes has flooded trade journals, legal alerts and media releases. Lawyers and pundits alike tout the Dukes decision as one of the seminal employment law decisions of our time. Diversity executives ignore this case at their peril.

The case — had it moved forward — would have been the largest employment class-action in history. The plaintiffs brought their case on behalf of themselves and 1.6 million other past, present and future female Wal-Mart employees, claiming the company’s practice of subjective decision making resulted in a systemic problem: women being paid less and promoted at slower rates than men.
The plaintiffs claimed the degree of discretion given to local management was a recipe for widespread discrimination, and that left to their own devices, local managers could not keep themselves from disenfranchising women.

In June 2011, the Supreme Court held the case could not proceed as a class-action in part because merely pointing to a policy of decentralized decision making is not, by itself, enough “commonality” glue to unite a mega-class like that proposed by the plaintiffs. The Supreme Court also rejected the argument that scattered statistical suggestions of unfair treatment coupled with anecdotal evidence sufficiently supported the claim that all of the company’s thousands of employment decisions could be evaluated in one fell swoop.

The repercussions of Dukes, one of the most-cited Supreme Court cases in history, are only now being felt in district courts around the country. As companies consider how to shape their diversity practices in the post-Dukes world, a few lessons warrant discussion.

Subjectivity is not necessarily a bad word. Making employment decisions based on subjective perceptions of qualifications and performance has always been part of American business, and this practice was not dealt the death blow the Dukes plaintiffs aimed to deliver. That does not mean subjective decision making should be done in a vacuum. Managers should be vested with the discretion to make employment decisions based on subjective criteria related to position requirements and job performance. Such decisions should be guided by effective corporate policies — including equal employment opportunity (EEO) policies — to ensure the decisions are made for legitimate, non-discriminatory reasons.

Be proactive. Companies should regularly review their EEO policies to ensure they comply with any new legal requirements and to confirm they communicate the desired corporate message. Once the policy has been developed, it should be re-published, properly implemented and uniformly enforced. This means employees — from executives to hourly workers — should be trained on the policy and the company’s expectation. Managers in particular should be trained on how to make decisions that comply with the company’s EEO policies.

A company might also consider auditing employment decisions for anomalous trends. Periodically reviewing basic demographic data arising from employment decisions could reveal problem areas — areas that do not necessarily mean discrimination has occurred, but rather show vulnerabilities and opportunities to emphasize best practices with management in the field.

Promote professionalism. People from an infinite number of backgrounds comprise today’s workforce. True professionalism transcends differing backgrounds. The values underlying professionalism create a unified workplace culture and can be an antidote for perceived unfairness. The good news is these traits are as trainable as they are conspicuous. We learned these basic traits in grade school, and we can all recognize a lack of professionalism when we see it. Diversity executives should consider initiatives that promote consistent and meaningful communication, workplace etiquette, and awareness of and adherence to company policies and procedures.

With the Dukes decision being made by a 5-4 majority, many employers view it as a wake-up call for diversity executives in particular. Promoting and retaining a talented, diverse workforce is good business. There was enough dissenting opinion to suggest employers would be well-served to do a top-to-bottom review of their employment practices. This would ensure they could hold up to the type of scrutiny endured by Wal-Mart during the last few years.

Rebecca P. Bromet is a partner at law firm Seyfarth Shaw. She can be reached at editor@diversity-executive.com.