Walmart and Title VII

It looks like the Walmart class action case is going to come a cropper, as they say, and the optics are unfortunate. By unhappy coincidence, the court's female justices are all liberals, and a 5-4 decision in a case that is in some senses about sex discrimination, with the female justices all on the losing side, seems tailor-made for outraged editorials in the New York Fishwrap. There is, of course, a splendid solution for that, one that President Daniels/Pawlenty/whomever should take. (Interestingly, Judge Sykes gave a talk on this subject just recently.)

This case isn't so much about the substance of employment disrimination as the outer bounds of the class action device, but while I'm here, a word on sex discrimination cases. Title VII bans discrimination on a host of grounds, including sex, and there's no doubt whatsoever that such discrimination happened. Cf. Ledbetter v. Goodyear, 550 U.S. 618 (2007). But I must admit to some doubts about how widespread it remains today, because refusing the services of a superior candidate on grounds wholly extraneous to anticipated performance (as most of the Title VII protections are) is, in a word, stupid. Employers who discriminate in this way lose out on talent and thus revenue, which might lead one to think the behavior self-deterring. Law can generally assume that people act rationally, and so it only needs to intervene to prevent socially unacceptable behavior that enriches the actor; socially unacceptable behavior that imposes costs on the actor is by-and-large self-deterring. Cf. Easterbrook, The Chicago School and Exclusionary Conduct, 31 Harv. J. of L. & P.P. 439 (2008).

Put another way, promoting optimally-talented people benefits a company, so a claim that an employer is arbitrarily excluding a group of otherwise talented people from promotion is ultimately a claim that the company is acting irrationally. And we ought to be very skeptical about claims that require us to believe that an employer is acting against its own interest on the basis of dubious—even frivolous—asserted motivations. Cf. Matsushita v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) ("if the factual context renders respondents' claim implausible—if the claim is one that simply makes no economic sense—respondents must come forward with more persuasive evidence to support their claim than would otherwise be necessary"); see also id., at 595. One must therefore wonder why EEOC would grant leave to sue in cases like Greene v. Potter, 557 F.3d 765 (7th Cir. 2009), Holland v. Sam's Club, 487 F.3d 641 (8th Cir. 2007), or Grabovac v. Allstate, 426 F.3d 951 (8th Cir. 2005), where claims of gender discrimination are easily rejected. This is only slightly less true in cases like Zimmerman v. Associates First Capital Corp., 251 F.3d 376 (2nd Cir. 2001), where discrimination can be and has been inferred by a jury.

I certainly wouldn't say that sex discrimination is extinct, but I think we (and particularly EEOC) ought to take into account the changes in society since Title VII was enacted and view such claims with a significantly more skeptical eye before exposing companies to significant litigation costs.