In a previous post, “Taking Your Rights Away with a Single Click,” we discussed the important function class actions serve and the harm caused by courts that have enforced contractual class action waivers. Employees who have been required to sign employment agreements that include class action waivers may be prevented from bringing certain employment discrimination claims. That is because some courts (federal courts in the 4th, 5th, 6th, and 11th Circuits, and some district courts in other circuits) require that a certain type of case—known as a “pattern or practice” discrimination case—be brought as a class action.
In a “pattern or practice” lawsuit, employees seek redress because discrimination is the employer’s “standard operating procedure.” If the employees win their case, the court will order the employer to change its practices to end the discrimination. For example, if the employer hires supervisors by notifying only a few selected individuals of each job opening, a court could order the employer to inform all employees of the openings to enable all employees, including members of the discriminated against group, to apply for open supervisor positions.
The Eleventh Circuit explained why pattern or practice claims should be class rather than individual actions in Davis v. Coca Cola Bottling Co. In that case, individual plaintiffs sought an injunction requiring Coca Cola to change the way it hired supervisors. The court found that the individual plaintiffs did not have standing to pursue injunctive relief because they could not prove that, in the future, they would personally be denied promotion to supervisor for discriminatory reasons. The court also expressed concern about the potential res judicata and collateral estoppel effect on other employees if the case was prosecuted as an individual rather than class case.
Whether employers will be able to avoid liability for discrimination by requiring their employees to execute class action waivers is unknown. It is certainly an outcome that should not be condoned. In a hopeful sign for employees, this summer, in Chen-Oster v. Goldman, Sachs & Co., a magistrate judge in the Southern District of New York (SDNY) denied an employer’s motion to compel arbitration. The employer argued that the case must be arbitrated because the employee had signed an employment contract that required that all claims be arbitrated. After surveying SDNY cases that required pattern or practice discrimination cases to be brought as class actions, the court determined that the plaintiffs’ right to bring a class action claim was more than just a matter of procedure, but instead went to the substance of the rights protected by Title VII. As a result, the court allowed the lawsuit to proceed in federal court.
If you believe that you have been the victim of a pattern or practice of discrimination, tell us your story.