The U.S. Supreme Court's 2011 ruling in the Wal-Mart Stores Inc. case not only had a significant impact within the courtroom, it also led to dramatically lower settlements in employment discrimination class action lawsuits, according to law firm Seyfarth Shaw L.L.P.'s Annual Workplace Class Action Litigation Report issued Monday.

In its June 2011 ruling in Betty Dukes v. Wal-Mart Stores Inc., the Supreme Court ruled against a proposed class of some 1.5 million members nationwide, holding the respondents did not identify a “common mode of exercising discretion that pervades the company.”

Seyfarth partner Gerald L. Maatman Jr., the report's general editor, said the ruling not only had an impact in the courtroom, it had a “significant influence on the settlement strategy” of employment discrimination class action in 2012 as well.

Mr. Maatman said the total of $48.7 million for the top 10 largest employment discrimination class action settlements in 2012 compared with $346.4 million in 2010, before the Wal-Mart decision was issued, according to the report.

The Supreme Court ruling “makes it harder for the plaintiffs bar to certify bigger cases and creates more defenses for employers, and therefore we can take a much tougher stance when we sit down at the settlement table in terms of potentially resolving some big cases,” he said.

Mr. Maatman said another “key takeaway” from this year's report is how by and large the Wal-Mart ruling “was not seized upon by federal judges” to apply to wage-and-hour cases despite “intensive defense efforts.”

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Meanwhile, he said, “My sense is that in 2013 there's going to be more wage-and-hour cases than in 2012,” which “seems to suggest one of the key challenges and one of the key areas of vulnerability for employers continues to be compliance with wage-and-hour statutes both at the federal and state levels.”

The report says other key trends include that government enforcement litigation reached new “white hot” levels in 2012.

“This was especially evident in terms of the systemic investigation program of the U.S. Equal Employment Opportunity Commission. As an inevitable byproduct of the economy's high unemployment rates, more discrimination charges were filed with the EEOC in 2012 than in all but one previous year since the founding of the commission in 1964,” for a total of 99,412.

Another key trend was that the continued economic dislocations in 2012 fueled more class action and collective action litigation over wage-and-hour laws, according to the report.

“In particular, the plaintiff's class action bar continued the pace of filings of (Fair Labor Standards Act) collective actions and class actions,” said the report. “Furthermore, these conditions spawned more employment-related case filings, both by laid-off workers and government enforcement attorneys,” it said.

Copies of the report can be obtained by registering here.