Food Chain Supermarkets

Is there evidence of discrimination in
promotion decisions?

Adverse impact



Did practices have disparate impact?
Four-fifths rule
Disparate treatment


Were qualified individuals turned down?
What were requirements?
Food Chain Supermarkets
UNIT
STORES
TOTAL EES
PROMOTIONS
PROMOTION RATE RATE RAT
YEAR WHITE BLACK WHITE BLACK WHITE BLACK BLACK/WH
2005
1191
99
104
6
8.7%
6.1%
0.69
2006
1192
111
129
8 10.8%
7.2%
0.67
2005-06
2383
210
233
14
9.8%
6.7%
0.68
WAREHOUSE
2005
2006
2005-06
223
411
634
192
173
365
18
42
60
21
13
34
8.1%
10.2%
9.5%
10.9%
7.5%
9.3%
1.36
0.74
0.98
TOTAL
2005
2006
2005-06
1414
1603
3017
291
284
575
122
171
293
27
21
48
8.6%
10.7%
9.7%
9.3%
7.4%
8.3%
1.08
0.69
0.86
Food Chain Supermarkets

Informal promotion systems must be formalized, with
less room for bias



Promotion criteria currently based on personality traits, not
necessarily job-related factors
Job posting
Voluntary affirmative action program, given likely underutilization


County labor force is 22% black, 37% of warehouse ees black (46% in
2005, 30% in 2006), 8% of store ees black (5% of store mngrs black)
In actual case, District Court found for plaintiffs,
Court of Appeals reversed re: adverse impact,
remanded re: disparate treatment

District Court found disparate treatment on remand
“Women vs. Wal-Mart”

Wal-Mart culture built on inspirational leadership, autonomy, trust


Bring Ees into org, convert them to principles: respect for individual, customer
service, excellence, and imperative to buy and sell at lowest price possible
But practices also may create barriers, e.g., job posting


Wal-Mart famous for promotion from within – more than two-thirds of managers
started as hourly Ees
Hourly job posted within stores, but until current suit, Co had never posted
openings for mngt training positions




Another aspect of culture which may create barrier is willingness to move
for the job


Not the Wal-Mart way, thought to be too bureaucratic…
Wal-Mart way was to trust that store mngrs will promote those who merit promotion
Co now also developing formula for pay increases based on evaluation ratings,
experience, and other factors to make raises more uniform
Single mother Asst Mngr involved in litigation moved nine times in eight years
across three states
Key for Wal-Mart is making processes fair without losing culture that makes
it special

Source: Fortune, 7/21/03