BOSTON — Attorneys representing seven women embroiled in a sex discrimination lawsuit against Wal-Mart have released a study alleging steep disparities in women’s compensation and rate of promotions versus men doing similar jobs throughout the corporate hierarchy.
This story first appeared in the February 11, 2003 issue of WWD. Subscribe Today.
The study, based on six years of Wal-Mart’s employment data turned over to plaintiffs, charges that women were paid 4.5 percent to 5.6 percent less than men with comparable experience in comparable positions. Among other findings, the study claimed it took women an average of 4.7 years to be promoted to management trainee, while men were promoted in 3.1 years, on average.
The study will be a key piece of evidence presented to San Francisco federal Judge Martin Jenkins at a July 25 hearing to decide if the lawsuit will receive class-action status. If the case, initially filed in June 2001, becomes a class action, it would be the largest sex discrimination case on record, encompassing more than 1 million former and current Wal-Mart employees.
A Wal-Mart spokeswoman confirmed that the retailer has retained Los Angeles-based law firm Paul, Hastings, Janofsky & Walker LLP, which specializes in class-action cases. But she claimed the analysis of the retailer’s corporate hierarchy is not objective.
“The facts don’t support the allegations,” she said. “For instance, they say we discriminate in promoting department manager to assistant manager, but we recently posted in all our U.S. stores an opportunity to enter a training program as an assistant manager.” Of those who expressed interest, she continued, 43 percent are women. “The same percentage as we promoted.”
Women currently hold 80 percent of department manager positions — an entry-level supervisory position paid hourly, according to the study. The management trainee program is the next rung on the corporate ladder.
“Women are two-thirds of the hourly workers,” said Brad Seligman, executive director of nonprofit Impact Fund, which is serving as lead counsel for the plaintiffs. “But when it comes to being promoted to management, they fall off a cliff.”
Women store managers — representing 14 percent of total manager ranks —made an average salary of $89,000, while male counterparts earned $105,000, the study claimed. Seligman said compensation disparities widen as executives climb the corporate ladder, with female regional vice presidents making roughly $280,000 annually versus $420,000 for men at that level.
The Wal-Mart spokeswoman said compensation is based on “position, experience, performance and other qualifications. There is no discrimination based on sex.”
Seligman described the corporate culture as “one that allows people to act on their stereotypical views. They have no system of accountability, although they’ve known for years there have been serious complaints about pay for women.”
Currently, women on average earn 76 cents for each dollar a man earns, according to U.S. Bureau of Labor Statistics.
Kirk Palmer, chief executive officer of executive search firm Kirk Palmer Associates, has not placed executives at Wal-Mart, but said he’s never heard rumblings that the Bentonville, Ark.-based company treats women unfairly.
“I’m not sure how statistically significant that [compensation] disparity is,” he said, adding that he “would be hard pressed to believe the company as policy would have any intention of discriminating against workers.”
In recent years, Wal-Mart has been aggressive in recruiting female executives from The Limited, May Co. and other companies to round out a growing product development team.
The world’s largest employer, Wal-Mart expects to hire 800,000 people globally in the next five years, the spokeswoman said.