Litigation and arbitration

U.S. Supreme Court Issues Decision on Wal-Mart Sex Discrimination Class Action Lawsuit

On June 20, 2011, a unanimous U.S. Supreme Court reversed a federal district court's 2004 decision certifying a nationwide class of female employees alleging sex discrimination in the company's pay and promotion practices under Rule 23(b)(2) of the Federal Rules of Civil Procedure. The decision follows rulings by the full Ninth Circuit Court of Appeals in 2010, and a three-judge panel of the Ninth Circuit in 2007, both of which had affirmed class certification in large part.

In a 27-page majority opinion written by Justice Antonin Scalia, the Supreme Court held that the district court improperly certified the Dukes class under both Rules 23(a) and 23(b)(2) of the Federal Rules. Four justices (Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, and Elena Kagan) dissented regarding the Court's Rule 23(a) analysis, disagreeing with the majority about the proper threshold standards to apply in evaluating class certification. However, all justices unanimously agreed that the district court ultimately should not have certified the class under Rule 23(b)(2)'s more specific requirements.

As employers everywhere breathe a collective sigh of relief, what should they still be on guard for, and what should they take away from the Supreme Court's decision and analysis?

To learn more about the decision and its implications for employers, please continue reading Littler's ASAP, And the Class Certification Battle is Won: A Unanimous Supreme Court Reverses Rule 23(b)(2) Class Certification in Dukes v. Wal-Mart, by Margaret Parnell Hogan and Danielle L. Kitson.

Saskatchewan Plans to Overhaul Human Rights Systems

The Saskatchewan government has introduced Bill 160, An Act to Amend The Saskatchewan Human Rights Code (pdf), to reduce inefficiency, delay, and complexity in the human rights system. If passed, the Bill would, among other things, phase out the Saskatchewan Human Rights Tribunal, which currently hears human rights complaints referred to it by the Saskatchewan Human Rights Commission, and require complaints to be heard in court.

Under the new system, the Commission will have the power to require mediation of all complaints. If, in the Commission's opinion, the complainant refuses a reasonable settlement offer, the Bill would give the Commission the power to dismiss the complaint. If the complaint is not resolved through mediation, the Commission may apply to the Court of the Queen's Bench for a hearing of the complaint. The Tribunal would only hear complaints filed prior to the Bill coming into force.

The Bill must still pass second and third reading and will be considered again when the provincial legislature reconvenes on March 7, 2011.

Consultation on Resolving Workplace Disputes Launched

Face OffThe UK's Coalition Government has launched a major consultation on reforming employment tribunals and the resolution of workplace disputes. The stated aims of the proposed measures are:

  • achieving more early resolution of disputes;
  • ensuring that the employment tribunal process is as swift, user friendly and effective as possible; and
  • helping business feel more confident about hiring people.

The document includes two highly controversial proposals that the Government has previously trailed: an increase in the qualification period for claiming unfair dismissal from one to two years (see our previous article on the background to this); and the introduction of a fee for lodging an employment tribunal claim. With regard to the latter, employers' organisations in the UK have been lobbying hard for a fee of up to £500 to discourage weak and spurious applications.

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Amendments to Ontario's Employment Standards Act, 2000

Amendments to the Employment Standards Act, 2000 contained in Schedule 9 of Bill 68, Open for Business Act, previously discussed here, have come into force. Among other things, the amendments:

  • Allow the Director of Employment Standards to require complainants to take steps to resolve their claim before assigning an investigator;
  • Permit Employment Standards Officers to mediate complaints; and
  • Allow Officers to make decision when parties fail to attend meetings or provide evidence.

New York Federal Court Dismisses Case Against U.S.-Based Corporation Alleging Human Rights Abuses in Guatemala

In what continues to be a flurry of activity in U.S. federal courts involving allegations of human rights abuses abroad, the Southern District of New York, in Palacios v. Coca-Cola Co., Inc., No. 10-03120(RJS) (Nov. 19, 2010), recently dismissed a federal lawsuit brought by a group of Guatemalan nationals in connection with their union activities in Guatemala.

In Palacios, Guatemalan nationals alleged that Coca-Cola Company, Inc. was complicit in death threats, murder and rape resulting from plaintiffs' union involvement at a Coca-Cola-affiliated processing plant in Guatemala. Significantly, the complaint included a consumer fraud claim under New York's General Business Law section 349, alleging that Coca-Cola fraudulently misrepresented to New York consumers - through its published "Workplace Rights" standards - that its affiliated bottlers "comply with internationally-recognized human rights standards, the laws of the countries where [Coca-Cola] operates, and the policies and directives of [Coca-Cola]." Surprisingly absent from the complaint was any claim under the Alien Tort Claims Act, a federal statute commonly used by non-U.S. plaintiffs seeking damages in U.S. courts for alleged violations of international law.

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10 Tips for Employers with Operations in China

The continuing growth of the Chinese economy means that even more foreign companies are looking to the People's Republic of China (or the PRC) to expand their operations. However, while many new operators in China are focused on lower labor costs or the vast potential market, these foreign businesses often neglect to fully educate themselves about Chinese employment laws and rules critical to their operations' success.

Indeed, the rapid evolution of the Chinese labor environment in the face of ongoing social changes presents many challenges for both foreign and domestic companies. Below, we summarize 10 key considerations for global businesses with employees in China and highlight some common mistakes.

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Ontario Court Certifies Class Action for Unpaid Overtime

In McCracken v. Canadian National Railway Company (pdf), the Ontario Superior Court of Justice has certified a class action proceeding by 1,550 current and former front-line supervisors against Canadian National Railway ("CN"). The lawsuit alleges that CN improperly classified front-line supervisors as managers thereby depriving them of overtime and holiday pay.

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European Court of Justice Reaffirms that Communications with In-House Counsel Are Not Privileged in Europe

On September 14, 2010, the European Court of Justice ("ECJ") reaffirmed its long-standing position that under European Union law communications with in-house lawyers in antitrust matters are not protected by the attorney-client privilege (or the legal professional privilege as it is known in the European Union). The court's ruling in Akzo provides an explicit caution to all HR professionals and lawyers. Before undertaking any sort of investigation and to avoid potentially devastating disclosure of privileged communications, they must carefully consider the application of the attorney-client privilege in the jurisdiction in question. In many instances, the only effective means of protecting information from disclosure is to involve outside counsel. To learn more about the decision and its implications for employers and in-house counsel, please continue reading Littler's ASAP The European Court of Justice Reaffirms that Communications with In-House Counsel Are Not Privileged in Europe by Nick Linn.

Ruling Redefines Actuarially Unreduced Pension Benefits

In C.A.W. v. Kitchener Frame Ltd., the Ontario Divisional Court confirmed an arbitrator's decision to depart from established jurisprudence on actuarially unreduced pension benefits when considering whether employees who retired on pension following a plant closure were entitled to severance pay under the Employment Standards Act, 2000 ("ESA").

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Huge Increase in Employment Tribunal Claims

YouAreFiredIII.jpgThe latest annual statistics (PDF) published by the UK's Tribunals Service have revealed a very significant increase in claims received by Employment Tribunals, which are now at their highest ever level. The number of claims in 2009-10 rose to 236,100, representing a 56% increase on the number of claims lodged in 2008-9. However, the report suggests that this is largely attributable to a rise in the number of multiple claims (i.e. arising out of the same or similar circumstances).

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