Class-Action Settlement Protecting Female Workers

Back in 2002, a woman named Shirley Ellis filed a complaint with the U.S. Equal Employment Opportunity Commission. In her complaint she alleged that Costco Wholesale Corporation denied her a promotion from assistant manager to store manager based on her gender. Due to Ms. Ellis filing her complaint, it was alleged that Costco retaliated and transferred her to a different store, one that could require up to a four hour daily commute.

In 2004, Ms. Ellis filed a federal class action lawsuit on behalf of herself and women similarly situated claiming that Costco methodically discriminated against women in how they managed promotions. Late last year, Ms. Ellis and Costco reached a tentative settlement agreement that will compensate Ms. Ellis and approximately 700 other women who were passed over for promotions.

Due to Ms. Ellis’ ability to file a class-action lawsuit, there are going to be real and tangible changes within Costco that will create better situations for both the company and the employees. Without this case proceeding as a class-action, is it unlikely that anyone would know anything about the fact that women comprise approximately 50% of Costco’s total number of employees but only 17% of the top management positions. Without a class-action lawsuit, it is unlikely that the 700 women who were also improperly denied promotions would be receiving any compensation from Costco. Finally, it’s highly unlikely that Costco would have agreed to wide institutional changes: to change its promotion procedures, hire a professional to evaluate its methods, create a posting process for job vacancies, and establish a system to track employee interest in promotions to management positions. These progressive changes only came about because a group of women had the legal ability to rally together and present their collective case. There is no question that a multitude of voices can make such a greater impact than a single voice.

However, recently some courts have started to determine that an employee can be required to sign an arbitration agreement that bans class action lawsuits as a condition of employment. By allowing this ban, the courts have greatly increased the protection afforded to employers. The ban on class action lawsuits as a condition to employment is something that employees will have to fight for years to come. Additionally, the impact of this type of defense should be unsettling to all employees. It is an effort of an employer to isolate itself from the laws that protect us all. So if an employee decides they are going to fire a group of people because of their religion, their race or gender they could potential escape any significant responsibility by relying on arbitration agreements. Preventing groups of people who have been discriminated against from joining together to have their claims hear in unison. A denial of their right to present their grievances to a jury of their peers. It is sad to me that corporate America can use their money and power to chip away at the rights of an average American.

If you feel that you have been discriminated against then please contact our Tennessee sexual harassment attorneys at the Higgins Firm. Our Tennessee employment lawyers are happy to help you in any way we can.