Monday, April 4, 2011

Litigation and Statistics -- The Wal-Mart Case

I had planned to have written a long piece by now about the long-awaited ruling in Dukes v Wal-Mart. Why am I so slow? Well, it's not me, in this case, it's our court system. The courts seem to have adopted a rhythm with which to hear cases that is reminiscent of the words of Oliver Wendell Holmes, the suggestions of Felix Frankfurter, and attributed by many to Earl Warren in Brown v Board of Education : "with all deliberate speed."

But that doesn't mean that I can't write about this case yet. There are interesting aspects, whether we have a decision or not. First, some background. If you are not at all familiar with this case, then you probably don't may much attention to labor issues. A class of more than one million women seeks standing to sue Wal-Mart for gender discrimination. What is at issue before the Supreme Court, at least as I understand it, is not whether there has been gender discrimination, but whether the group of female employees and ex-employees of Wal-Mart have standing to sue.

That's for the lawyers. I'm not one of them.

But, I have read a number of purportedly learned articles on the subject. The more right-leaning of the bunch say that Wal-Mart certainly has the right to compensate its employees based on any reasonable criteria that it finds appropriate. The more left-leaning point to data showing that this class of women, on average, have been compensated $1.17 less per hour than their male counterparts.

I haven't read the pleadings. I haven't heard the oral arguments. So, I don't have all the information that the Supreme Court justices do. And, I'm not here to tell you whether this class should have standing to sue as a class, or whether if they do have standing to sue, they should prevail on the merits. What I am here to tell you and I've said this before is that statistics, at least when used improperly or cherry-picked, lie.

Is a $1.17 per hour pay differential between the genders material? At Gibson, Dunn & Crutcher (the lead firm defending Wal-Mart in this case), it's probably not. Data that I have seen suggests that they pay their employees well enough that $1.17 per hour is just not meaningful. It's a bit like trying to find $500,000,000 in the US budget. Nobody seems to care.

But, similar data suggests that Wal-Mart does not pay its rank and file quite as well as Gibson, Dunn does. Supreme Court Justice Ruth Bader Ginsburg appears particularly passionate that the females of Wal-Mart have been wronged. One of the more conservative justices (I would call him out if I could remember which justice it was, but I don't) has said that $1.17 per hour just isn't material (my choice of words, not his).

I don't know, but I strongly suspect that neither of these justices is qualified to discuss statistics, sampling, margins of error or the like. Don't get me wrong, they are none brilliant scholars -- even the ones that I personally don't think much of are smarter than the average bear (sorry, Yogi, I know that's really you). But, I have seen the way that they toss around statistics. They generally don't get it.

I suspect that if this case does ever go to trial on the merits that lots of said statistics will be tossed around. And, this particularly cynical observer (who? me?) thinks that all will be meant to deceive rather than to inform.. Do you want to do a truly meaningful comparison? Then, compare similarly situated employees. As an example, consider all of the Wal-Mart employees who are between the ages of 40 and 50 who have been with the company as store clerks (my name not theirs) for between 5 and 7 consecutive years in stores in affluent suburbs in the southeast United States. Now compare the pay of men and women. Is it the same, on average. Is it different? Is it different beyond a margin of error given the sample size?

Methinks the courts don't care. They don't understand such mathematical minutiae and frankly, they are probably not worried about it.

So, the right will throw statistics around. The left will throw statistics around. Little of it will make any sense, and the courts will decide.

It just doesn't seem quite right to me.

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