Female managers at Costco Wholesale Corp. can go ahead with a class-action discrimination lawsuit against the Issaquah, Wash.-based retailer, a federal judge ruled Thursday.
Judge Marilyn Hall Patel wrote that the women "presented strong evidence of a common culture at Costco which disadvantages women." As many as 700 women in Costco middle management may be affected by the ruling.
Costco, often praised by labor activists for generous pay and benefits, was sued in 2004 by Shirley "Rae" Ellis, a Costco assistant manager.
Ellis, who was later joined in her suit by two other Costco workers, claimed that women effectively were barred from the top store jobs at Costco because the company didn't post openings, explain application procedures or provide promotion criteria.
Instead, store managers -- who can make $100,000 plus bonuses and stock options worth many times that amount -- are selected informally by a "tap on the shoulder" in a process that mostly benefited men, Ellis claimed.
Costco Chief Executive James D. Sinegal said Thursday that he expected to appeal the ruling. The company has denied any discrimination.
"This is going to be a long process," he said, declining to elaborate on the issues involved.
Costco, which last year posted $60.2 billion in sales, operates 371 stores with 93,000 employees in 38 U.S. states and Puerto Rico. The company has 504 warehouse stores worldwide.
Thursday's class certification ruling buoys the women's case, said Jocelyn Larkin, an employment-discrimination lawyer with the Impact Fund, a Berkeley-based nonprofit that is supporting the litigation against Costco.
"It's the difference between three women and 700 women, and they have to take us a lot more seriously," Larkin said.
The Impact Fund also is backing a class action alleging gender discrimination at the world's largest retailer, Wal-Mart Stores Inc.
Wal-Mart is appealing a court's decision to certify the class of as many as 1.6 million women. The suit would be the nation's largest workplace discrimination case.