Wal-Mart Wage Settlement A Steal

According to Bloomberg, Wal-Mart has won preliminary court approval to pay as much as $85 million to settle 30 wage/hour lawsuits. The lawsuits claimed the company didn’t pay employees for all hours worked, forcing them to miss breaks and forgo overtime pay.

Late last year, Wal-Mart announced that it would settle 63 wage and hour class action lawsuits that have been pending against the company for several years. There were just under 80 such suits pending against Wal-Mart at the time, so it represented a pretty large legal housecleaning. This $85 million settlement covers just under half those cases as part of the larger agreement made back in December, which could cost the company up to $640 million before all is said and done.

Following the initial settlement, we noted that what these cases revealed through evidence and employee testimony was a “corporate culture” and systematic approach geared towards cutting labor costs, by dictating managers hire below the “preferred” staffing levels and rewarding managers for keeping labor costs down. Steven Greenhouse on TPM has pointed out that while store management is ultimately responsible for setting schedules, pressure often comes from the top:

Robert Eckert, a former assistant store manager at several Wal-Marts in California, said: “They tell you that working off the clock is against the law, is not allowed by Wal-Mart, and then they tell you to get the job done. But they didn’t give you the budget to get the job done. It is clearly understood that if you don’t make payroll, it’s a serious issue and you can lose your job over it.”

For more information on wage theft in general, you should check out Kim Bobo’s “Wage Theft in America: Why Millions of Working Americans Are Not Getting Paid - And What We Can Do About It.”

As for the $85 settlement, a Federal Judge in granting temporary approval called the wage theft agreement “fair, reasonable, and adequate.” Merely adequate for the workers, perhaps, but no doubt a “steal” for Wal-Mart.

Wal-Mart Wins Initial Approval for Wage Settlements [Bloomberg]

Wal-Mart Wins Initial Approval for Wage Settlements (Update1)
By Margaret Cronin Fisk

May 28 (Bloomberg)—Wal-Mart Stores Inc., the world’s biggest retailer, won preliminary court approval to pay as much as $85 million to settle 30 lawsuits claiming the company didn’t pay employees for all hours worked.

The settlement covers cases filed in federal courts in 29 states and Puerto Rico, according to court filings. The accord is part of a global $640 million resolution of wage-and-hour claims reached between Wal-Mart and workers in December.

The settlement is “fair, reasonable, and adequate,” U.S. District Judge Philip M. Pro said in granting tentative approval today. The agreement was a “hard-fought compromise of claims that have been actively litigated before this court” since February 2006, he said.

The suits claimed that Bentonville, Arkansas-based Wal-Mart violated wage and hours laws by denying workers rest breaks and manipulated time cards to “shave” their pay. The suits were filed as class actions, or group lawsuits, on behalf of all hourly workers in the individual states, including Alabama, Michigan, Maryland, Oregon and Texas.

Wal-Mart spokeswoman Daphne Davis Moore didn’t immediately return a call for comment.

The lawsuits are combined in In Re: Wal-Mart Wage and Hour Employment Practices Litigation, MDL 1735, U.S. District Court, District of Nevada (Las Vegas).

Posted by Corey Himrod on Monday, June 01, 2009

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