Merchant of Shame
WAL-MART -- the world's largest corporation -- doesn't take no for an answer. When it decided to build 40 new big-box stores in California, it acted as though it had a divine right to expand its empire into the state.
When Contra Costa County supervisors tried to ban the behemoth, Wal-Mart placed a referendum on the ballot -- and won. When Oakland decided to ban such "supercenters" -- stores the size of several football fields that also sell groceries -- Wal-Mart sued.
If, as expected, the San Francisco Board of Supervisors approves a ban on such big-box stores this week, you can be sure the corporation will fight back.
It's unlikely, however, that Wal-Mart will employ the same tactics that resulted in its recent defeat in Inglewood. With breathtaking arrogance, Wal- Mart tried to exempt itself from all environmental, traffic and zoning laws in that low-income community. In response, residents stood up to the giant retailer, opposed the corporation's initiative, and on April 6 voted the plan down, 61 to 39 percent.
But neither community opposition nor 6,549 active individual employee lawsuits worry the giant retailer. The real threats that have rattled corporate headquarters in Bentonville, Ark., are the class-action suits, especially a huge sex discrimination claim awaiting certification by a San Francisco federal judge.
In 2001, two California women, joined by four workers from other states, (Dukes vs. Wal-Mart Store, Inc.) charged that Wal-Mart had discriminated against its female employees in promotion, wages and job assignments.
Between 1996 and 2001, women took home about 5 percent less than men doing similar jobs. Most women workers -- 72 percent of the sales force -- earned $6.10 per hour and $12,688 per year, which made half their families eligible for the federal food stamp program and government-funded health care for their children.
In September 2003, lead attorney Brad Seligman asked a San Francisco federal judge to certify the suit as a class-action suit.
Wal-Mart argues that any discrimination that has occurred is due to different job descriptions and rogue managers. Seligman, however, says that the corporation fosters a common culture. "All managers are trained together. This is not a case involving disparate autonomous stores."
If the judge rules favorably, the suit will represent 1.6 million former and current women workers -- making it the largest class-action suit in history against the biggest corporation in the world.
"Individual employee lawsuits," says Seligman, "are like a fly biting an elephant. Only large class-action suits scare such a large corporation."
Mona Williams, a Wal-Mart spokeswoman, agrees. "It's No. 1 on our radar screen right now, " she said, soon after Seligman filed for class-action status.
Accustomed to opposition from labor unions and environmentalists, Wal- Mart was caught off guard when the National Organization for Women in 2002 officially designated the corporation a "Merchant of Shame" -- a label bestowed upon businesses that have the worst labor practices.
Since then, hundreds of NOW activists have been canvassing local Wal-Mart stores, trying to inform consumers -- who like the low prices, easy parking and one-stop shopping -- how the corporation is able to offer such great deals: Wal-Mart pays a pittance to workers in sweatshops in China, squeezes its suppliers, compensates its employees with the industry's lowest wages and offers unaffordable health benefits.
Wal-Mart also faces 30 other employee class-actions suits across the country, four of which have received certification. Last week, the California Supreme Court gave the green light to a class-action suit that will proceed to trial next September in Oakland.
The suit, which represents about 204,000 California employees, charges that Wal-Mart managers routinely forced workers to labor without taking required rest or meal breaks and to work overtime without payment.
The reasons for these practices, according to Jessica Grant, an attorney with the San Francisco firm that represents the workers, is that Wal-Mart habitually understaffs its stores. Workers must skip breaks and work unpaid overtime or risk getting fired. Grant also told me that Wal-Mart has recently asked workers to sign waivers for meal breaks. When the case goes to trial, the corporation will then argue that workers didn't really want any time to eat.
Wal-Mart has denied all allegations. It has also launched a television advertising campaign that features beaming workers describing their excellent health care and casts the corporation as a good neighbor who contributes "good works" to local communities.
Wal-Mart knows no shame.