A federal judge has ruled a sex discrimination lawsuit against retail gain Wal-Mart can proceed as a class action in what would be the largest civil rights class action suit to be brought against a private employer in the United States.

The suit, filed by six women in 2001, claims the world's largest retailer systematically denies promotion and equal pay to female employees.

Wal-Mart, which has struggled recently to repair the damage to its image caused by dozens of lawsuits over its employment practices, said it "strongly disagreed" with the judge's decision and would appeal.

The class includes more than 1.6 million current and former female employees of Wal-Mart who worked at its US stores since December 26th, 1998.

US district court judge Mr Martin Jenkins in San Francisco described the case as "historic in nature, dwarfing other employment discrimination cases that came before it".

He ruled the class could pursue an award of punitive damages as well as back pay for wage differences and lost earnings for those denied promotions.

Lawyers said settling the case could cost Wal-Mart hundreds of millions of dollars.

Ms Mona Williams, Wal-Mart's chief spokesperson, would not comment on the details of the litigation but said: "Let's keep in mind that today's ruling has absolutely nothing to do with the merits of the case."

Lawyers said the case was unlikely to break new legal ground but that it could encourage other disgruntled employees to pursue similar claims.

Mr John C. Fox, chair of the employment law department at Fenwick & West, the legal firm, said: "Today's ruling will entice many plaintiffs' lawyers to attack companies with centralised personnel policies like Wal-Mart's."

Mr Fox added the class action case was also significant because of its size.- (Financial Times Service)