Bloomberg Law
Dec. 6, 2019, 9:00 AM

INSIGHT: Employer Lessons From the WalMart Pregnancy Discrimination Settlement

Carolyn Wheeler
Carolyn Wheeler
Katz, Marshall & Banks, LLP
Greta Allardyce
Greta Allardyce
Katz, Marshall & Banks, LLP

Walmart, the largest employer in the United States, agreed to pay $14 million to settle a lawsuit filed by a class of pregnant current and former employees. The plaintiffs alleged that Walmart’s job modification and accommodation policy violated Title VII and the Pregnancy Discrimination Act (PDA) by treating employees who requested accommodations differently based on whether they had an on-the-job injury, were pregnant, or had a disability.

The court tentatively approved the settlement on Nov. 14, and under its terms, members of the class will receive an average payout of $1,000 to $2,000.

There are a number of lessons from this case, but one of them is that all employers should now understand that light duty accommodations cannot be offered only to people injured on the job, or only to people with disabilities, but must also be made available to pregnant workers who need accommodations.

The settlement was reached after a federal district court in Illinois denied Walmart’s motions to dismiss in March of 2018, and before there was a ruling on class certification.

Accommodations Refused in Illinois and Florida

On May 12, 2017, Talisa Borders and Otisha Woolbright filed a class action lawsuit against Walmart on behalf of female employees who were subject to the company’s accommodation policies that were in effect before March 2014.

Walmart’s policy until March 2014 provided reasonable accommodations to those with disabilities, but other employees with medical conditions that prevented them from performing their jobs were eligible for job aids at Walmart’s discretion. The policy stated explicitly that pregnant employees could not receive common job aids of “creating a job, removing or reducing an essential function of [the employee’s] job, transferring a portion of a job to another associate, light duty, temporary alternative duty, or reassignment.”

Under this policy, Walmart refused to grant Talisa Borders, a pregnant employee who worked at a Walmart store in Illinois, an accommodation of being excused from lifting over 25 pounds and from climbing ladders, and instead forced her to take an unpaid leave of absence.

Similarly, Walmart denied the same accommodation to Otisha Woolbright, a pregnant associate in Florida, but a few weeks later allowed her to go on light duty when she injured herself lifting a tray because that was an on-the-job injury that entitled her to an accommodation. However, Woolbright’s store manager terminated Woolbright a few weeks later after she inquired about Walmart’s parental leave policy.

In response to Border’s and Woolbright’s suit, Walmart filed two motions to dismiss, both of which the district court denied. First, Walmart argued that the Illinois federal court lacked personal jurisdiction over Woolbright’s claims because she lived and worked in Florida, while Walmart is incorporated in Delaware and headquartered in Arkansas. The court explained that in exceptional cases, where a corporation has substantial operations in a forum other than its home state, its operations may render it home in that state.

The court observed that Walmart is the largest private employer in Illinois and does more business, hires more employees, and collects more taxes there than it does in its home states of Arkansas and Delaware. As a result, the court held that it had jurisdiction under the exceptional case rule to hear Woolbright’s claims.

Walmart’s second motion to dismiss argued in part that the plaintiffs had not plausibly alleged claims for discrimination or retaliation. The court ruled that under the U.S. Supreme Court decision in Young v. United Parcel Service Inc. (2015), the plaintiffs had clearly stated a pregnancy discrimination claim.

The court also made short work of Walmart’s argument that Borders and Woolbright did not engage in protected activity. The court held that asking for job accommodations and inquiring about Walmart’s parental leave policy constituted protected activity for purposes of a retaliation claim.

Vindicating Rights Under Title VII

Pregnancy discrimination is still widespread, although pregnancy charges filed with the Equal Employment Opportunity Commission have decreased since 2010. The court’s refusal to dismiss this case and the subsequent class settlement strengthens employees’ ability to vindicate their rights under Title VII.

The court’s conclusion that Walmart’s presence in Illinois is “exceptional,” making it the appropriate forum for a suit by an employee who lived and worked in another state, signals that companies operating nation-wide may be subject to suit anywhere by employees who wish to challenge discriminatory policies and practices based on pregnancy status, or other protected characteristics.

This ruling sends an important message to corporations that expand their businesses across the country while calling Delaware their “home.”

Additionally, the court’s ruling that the plaintiffs engaged in protected activity when they requested accommodations or information about Walmart’s parental leave policy affirms a broad interpretation of what types of employee conduct can constitute protected activity.

The plaintiffs did not complain or oppose discrimination in the traditional sense, and the court’s recognition that asking for an accommodation is also a form of protected conduct is a helpful ruling that could benefit plaintiffs in a variety of cases. Workers who need accommodations for their religious practices, disabilities, pregnancy-related limitations, or caregiving responsibilities should feel free to ask for what they need without fear of losing their jobs, and this decision reinforces the view that seeking such an accommodation is protected conduct under the anti-discrimination statutes.

Although it is not surprising that Walmart changed its policies and agreed to settle this pregnancy discrimination claim in light of the Supreme Court’s ruling in Young v. UPS, the resolution of this case sends an important reminder to employees and employers everywhere that workers who are pregnant must be treated the same as others who have similar restrictions.

All employers should now understand that light duty accommodations cannot be offered only to people injured on the job, or only to people with disabilities, but must also be made available to pregnant workers who need accommodations.

Walmart’s agreement to settle this class action, although it admitted no wrong-doing, reflects an understanding that discriminating against employees is bad for business, and also has real costs. Borders and Woolbright filed suit in 2017 and this resolution a little over two years later represents a speedy vindication for them, and all Walmart employees affected by the old discriminatory policy they challenged.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

Author Information

Carolyn Wheeler is of counsel at Katz, Marshall & Banks, an employment and whistleblower law firm in Washington, D.C. Prior to Katz, Marshall & Banks, she was an attorney in the Equal Opportunity Employment Commission’s Office of General Counsel.

Greta Allardyce is an associate at Katz, Marshall & Banks, an employment and whistleblower law firm in Washington, D.C. Previously, she worked at the D.C. Office of Human Rights and the D.C. Office of the Attorney General.

The case against Walmart was brought by the National Women’s Law Center, A Better Balance, and Mehri & Skalet PLLC.