Class Action Breaks Pattern & Practice of Discrimination For 67,000 Women
Joe Sellers, Loren Donnell, Sam Smith, and Tommy Warren, who are among the counsel for the class.
Courageous women inducted into Impact Fund Class Action Hall of Fame.
In 2005, when this case began with the filing of the initial five EEOC charges of discrimination, Sterling Jewelers Inc. (“Sterling”) was already the largest specialty jeweler in the United States with stores operating in all 50 states. The initial charges of discrimination described a company-wide pattern of discrimination in the pay and promotions practices of Sterling adverse to its female employees.
Sterling’s pay discrimination was cloaked by a strict policy prohibiting employees from discussing their pay with co-workers. This policy precluded most employees from uncovering instances in which they were paid less than similarly-situated co-workers. Nonetheless, some of the women who started this litigation had access to pay data, which revealed women were paid less than men doing the same work. In 2005, Plaintiff Dawn Souto-Coons, then an assistant manager with Sterling in Brandon, Florida, came across a payroll form for the store she worked in that showed that most of the women employed there, including Plaintiff Marie Wolf, were paid less than male employees even though the women had substantially more experience. Ms. Wolf was shocked and upset when Ms. Souto-Coons shared this information. At the time, Ms. Wolf held company-wide sales records and believed she was the highest paid full-time sales associate at her store. Ms. Wolf complained to her store manager, who informed her that he “has to take care of his boys.” The pay disparities were not limited to sales associates. They also observed it among the retail store managers. For example, when Plaintiff Lisa McConnell was promoted to store manager in Elkhart, Indiana, she met with her district manager who wrote the amount of her new salary on a napkin and slid it to her expecting her to be thrilled. She became less thrilled when she learned from a male store manager in her district that her salary was thousands of dollars less than the other male store managers in the district. Ms. McConnell stated, “I found myself working in an environment filled with stress and pressure to prove that I was as capable of doing the same job as my male colleagues. The difference was, I had to work twice as hard for less pay and fewer promotions.”
Like the disparities in pay, the disparities in promotions adverse to women were masked by company-wide policies that hid the discrimination. In 2005, when the first charges were filed, Sterling’s promotion policies were unstructured. There was no posting of promotional openings. Instead, promotions were made through a “tap on the shoulder” selection process that selected individuals for promotion from within the company without any notice to employees of the openings or opportunities to apply for the positions. For example, in 2005, Plaintiff Judy Reed, an assistant manager in Florida at the time, now deceased, was denied promotions to store manager three times, despite having 25 years of experience in the jewelry industry, seven of which were with Sterling. On one of those occasions, the store manager position was awarded to a male with no prior jewelry experience before joining Sterling and only two years of experience with Sterling. Far from the truth, Ms. Reed was informed by her manager that the store manager position was being filled by a “seasoned” employee with a proven track record at Sterling. Ms. Reed recalled, “I felt like I was just put through the motions of, well, let’s give her an interview, but we’ve already made the decision.” Similarly, Plaintiff Denise Maddox, who was employed with Sterling for nearly ten years in three different states and a consistent top performer, was passed over for promotions to Store Manager in favor of less qualified males at least twice.
Women Workers Demeaned
In 2005, and for years afterwards, the Plaintiffs claimed that executives at the highest level of Sterling and many of those involved in the pay and promotion decisions at the heart of this case engaged in conduct demeaning to women, sending the clear message that women were less valued members of the Sterling workforce. The conduct occurred in settings that were public and private, ranging from banter in hallways and elevators to interactions within Sterling stores and at the mandatory annual meeting of all company managers. The Plaintiffs reported that this behavior included frequent references to women in sexual and vulgar ways; groping and grabbing women; soliciting sexual relations with women, sometimes as a quid pro quo for employment benefits; creating an environment at mandatory company events in which women were expected to undress publicly, accede to sexual overtures and refrain from complaining about the abusive treatment to which they have been subjected. The Plaintiffs claimed this pattern of conduct polluted the company’s workplace environment, inevitably establishing de facto standards for assessing the value of female employees less than male employees at Sterling in routine compensation and promotion decisions. Many of the Plaintiffs, including Plaintiff Lisa McConnell, described Sterling’s culture as being a “good ole boys club.” Ms. McConnell stated, “I was made to feel lucky I had a job with this company, and it was best to keep my mouth shut and look the other way.”
Enough! The Women Take A Stand
In 2005, when the first charges were initially filed in this case, the Plaintiffs were scattered across the United States with little or no knowledge of the circumstances of the other Plaintiffs, leaving them feeling isolated and helpless. For example, Ms. McConnell was terminated from her store manager job at Sterling after objecting to blatant sexual harassment and was told by her district manager that she could not fight Sterling because “you are only one person.” Ms. McConnell replied, “It only takes one.” McConnell filed her initial charge with the EEOC without an attorney and sought help from the federal government. Other Plaintiffs, like Dawn Souto-Coons, became fed up with the continued denials of promotion opportunities and the unfair pay she was experiencing, and reacted by getting angry and then hiring experienced class action attorneys to assist her. Ms. Souto-Coons said, “I was so mad, it was just an old boys’ club.”
Finding The Strength To Carry On
After filing the initial charges in 2005, the Plaintiffs soon learned that they were required to arbitrate their cases before the American Arbitration Association (“AAA”) pursuant to Sterling’s RESOLVE Program, which was a three-step alternative dispute resolution program that culminated in arbitration. Whereas the RESOLVE Program promised the Plaintiffs a swift resolution to their complaints, the Plaintiffs found it became a major impediment to obtaining meaningful relief. In addition to being required to submit complaints more detailed than required by the courts, each Plaintiff recalls being required to submit to mediation before mediators employed by Sterling before they could litigate their claims in arbitration. Finally, in April 2008, more than three years after filing their first complaints, the Plaintiffs filed an arbitration demand with the AAA seeking to litigate collectively their pay and promotion claims under Title VII of the Civil Rights Act of 1964 and the Equal Pay Act.
In response to the Plaintiffs’ EEOC charges, the EEOC issued a cause finding, concluding that, from the evidence presented, there were reasonable grounds to find a pattern or practice of sex discrimination in the company’s pay and promotion practices. In September 2008, the EEOC filed its own lawsuit against Sterling in the United States District Court for the Western District of New York. EEOC v. Sterling Jewelers Inc., No. 08-cv-0706(A)(M) (W.D.N.Y.). Ultimately, in 2017, the EEOC settled its litigation against Sterling pursuant to a consent decree that required an outside examination of the company’s pay and promotion policies but provided no monetary remedies.
After nearly three years of litigation devoted exclusively to establishing that the Plaintiffs could pursue their claims collectively, they began conducting discovery of Sterling’s pay and promotion practices. Finally, in June 2013, more than five years after the Plaintiffs first sought to arbitrate their claims, they sought class certification. Many of the Plaintiffs attended the two-day class certification hearing, which was held in New York City. In February 2015, the arbitrator granted certification of the Title VII pay and promotion claims and certified a class of almost 67,000 women. The arbitrator also permitted the Plaintiffs to pursue their EPA claims collectively. Ultimately, over 10,000 women joined the EPA collective.
Notwithstanding the evidence of widespread harassment at all levels of the retail operations, the arbitration process went through a dizzying number of rounds including 14 motions from the defendant designed to thwart the women, six comprehensive mediations, additional discovery and the appointment of a new arbitrator.
Understandably, many of the women were frustrated with the length of time the case took to be resolved. Ms. McConnell stated, “I found the legal system to be a very slow process, even though we knew Sterling was a company with many problems. The case was like a never-ending chess game. It was like riding a rollercoaster, year after year, as we inched our way to the top, there were loops that went around and around. We persevered and were lucky to have a great legal team that believed in us from the start and were willing to take Sterling to the mat, even though we all knew Sterling would not go down without a fight.”
At last, Victory!
When the case was finally settled in June 2022 for a payment of more than $175 million dollars and the agreement to ensure Sterling’s pay and promotion practices complied with the Uniform Guidelines on Employee Selection Procedures, many of the Plaintiffs were relieved that the case, which extended from 2005 to 2022, was finally resolved. Ms. McConnell said, “For me, the day I heard Sterling settled was surreal. After so many years of believing that what we were fighting for would come to fruition, it did just that! As I came to grips with the case settling, I began to cry with so many emotions welling up that had been bottled up for almost 18 years. This case had been such a big part of my life, but I felt relieved that we had been able to create significant changes to an environment that was badly broken.”
Ms. McConnell summarized her feelings about the case as follows: “As I think back to the beginning and all that I went through, I never felt sorry for myself for having had to go through such injustice, for those words that were meant to hurt me the day I was fired so wrongly, actually propelled me to greater heights. I never want my daughters or granddaughters to have to fight so hard to be paid or promoted in what was considered a ‘man’s world!’ I am proud to know I am part of a wonderful group of women that believed in themselves as individuals who collectively are now an important part of women’s history. My hope for the future is for what was done to us, to never be done to the generations of women to come.”
On February 23, 2024: Laryssa Jock, Christy Meierdiercks, Maria (Mary) House, Denise Maddox, Lisa McConnell, Gloria Pagan, Judy Reed, Linda Rhodes, Nina Shahmirzadi, Leighla Smith Murphy Brown, Dawn Souto-Coons, Marie Wolf, and Kelly Contreras were inducted into the Impact Fund Class Action Hall of Fame for their courage and sacrifice as named plaintiffs in the case: Jock v. Sterling Jewelers..