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December 27, 2002
Wal-Mart Settles Pregnancy Discrimination Case
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-Mart has agreed to pay $220,000 to settle a U.S. Equal Employment Opportunity Commission (EEOC) lawsuit in which a prospective employee alleged that company did not hire her because she was pregnant.

Under the consent decree filed in Arizona District, Wal-Mart will pay nearly a quarter million dollars to Jamey Stern and engage in comprehensive training concerning the Pregnancy Discrimination Act of 1978, in lieu of a further trial on the issue of punitive damages. The EEOC filed this lawsuit in 1994 alleging that Wal-Mart refused to rehire Jamey Stern at their Green Valley, Ariz., store because she told them she was pregnant in November 1991. The litigation was subjected to repeated trials and appeals before all issues were finally resolved.

According to the lawsuit, after Stern informed the store's assistant manager that she was pregnant, the supervisor told her to "come back after she had the baby." Stern was not aware that refusing to hire someone because they are pregnant is against the law until she read an article in a magazine in her doctor's office. She then filed a charge of discrimination with the EEOC and the Arizona Civil Rights Division. The EEOC investigated the case and filed the lawsuit on behalf of Stern.

"Sometimes employers don't take pregnancy discrimination as seriously as other kinds of discrimination," says Mary Jo O'Neill , the regional attorney for the Phoenix district office. "It is illegal to refuse to hire a woman because she is pregnant. This settlement confirms that the EEOC will not tolerate pregnancy discrimination."

In 1997, a jury found that Wal-Mart intentionally refused to rehire Stern because she was pregnant. However, the issue of punitive damages was not allowed to go to the jury in that trial. The EEOC appealed that decision. The Ninth Circuit Court of Appeals sent the case back to the District Court to be retried on the issue of punitive damages. The issue of punitive damages was tried to a jury in 2000, but again evidence pertinent to Wal-Mart's actions and to the question of punitive damages was withheld from the jury, according to the EEOC.

The case was again appealed and the Ninth Circuit, which once more sent the case back to the District Court with explicit directions that the jury was to be told that Wal-Mart fabricated a number of facts during the investigation and initial trial, according to the EEOC.

Under the Pregnancy Discrimination Act of 1978, which amended Title VII of the Civil Rights Act of 1964, employment discrimination on the basis of pregnancy, childbirth, or related medical conditions constitutes unlawful sex discrimination. In addition to prohibiting sex-based discrimination, Title VII prohibits discrimination based on race, color, religion or national origin.

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