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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.

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On August 7, 2007, Charleston County Circuit Court Judge Perry M. Buckner III ruled Wal-Mart would have to face a class of more than 100,000 South Carolina employees claiming wage and hour violations - the workers filed suit in 2001 claiming Wal-Mart forced them to work through breaks and off the clock. Complaints of understaffing were front and center, as workers were forced to skip breaks, work before shifts or stay after clocking out to pick up the slack.

The case is Carter v. Wal-Mart and is part of a long list of wage and hour lawsuits, the resolution of which have seemingly been priority #1 with Wal-Mart’s legal team. Carter is one of 63 long active cases that were pending against Wal-Mart until two months ago, when the company announced it had agreed with attorneys for plaintiffs on a settlement agreement. South Carolina workers will get $49 million as part of the Carter settlement, which was approved by Judge Buckner on Tuesday and formally announced this morning.

The settlement will conclude more than six years of litigation concerning Wal-Mart’s employment practices in South Carolina. Wal-Mart in the settlement agreed to maintain electronic systems, surveys and notices to protect workers’ rights. “We are pleased with the preliminary approval of the settlement by the Court. We hope that Wal-Mart’s industry leading compliance model will set an example for the retail industry,” said plaintiff’s attorney Brad Hutto of Williams & Williams in Orangeburg, S.C.

The settlement reached back in December could, as a whole, cost the company up to $640 million before all is said and done.

Wal-Mart Paying $49 Million To Settle South Carolina Wage & Hour Lawsuit [Northwest Arkansas Morning News]

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A settlement in a Minnesota wage and hour class action has moved a step closer to reality, gaining court approval that would allow Wal-Mart to pay over $54 million to close the lawsuit Braun v. Wal-Mart. The settlement includes not only back pay to employees, but also a payment to the Minnesota Department of Labor and Industry believed to be the largest payment of its kind in Minnesota history.

From Bloomberg, via the Minneapolis Star Tribune:

The Minnesota hourly workers said Wal-Mart forced them to work off-the-clock in training and denied full rest or meal breaks in violation of state wage-and-hour laws. In the first phase of the case, Dakota County District Judge Robert King Jr. ruled July 1, following a nonjury trial, that Wal-Mart broke labor laws more than 2 million times and ordered the retailer to give employees $6.5 million in back pay.

Wal-Mart will pay $14 million of the $54 million settlement to the State of Minnesota - the Minn. Dept. of Labor was a plaintiff in the case, and the payment covers Wal-Mart’s violations of Minnesota wage and hour laws.

As for the settlement, this one was reached before a certain other settlement agreement was reached by Wal-Mart. Between the $54 million here, the $33 million payed out to the DOL, $400+ million in previous judgments and settlements, and the $350-$640 million that will be paid out as part of Wal-Mart’s most recent multi-litigation settlement, these wage cases could end up costing the company over $1 billion.

Minnesota to get $14 million from Wal-Mart settlement [Bloomberg, via Minneapolis Star Tribune]

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On December 23, 2008, Wal-Mart announced that it would settle 63 wage and hour class action lawsuits that have been pending against the company for several years. That number represents approximately 86% of the 73 wage/hour and overtime class actions currently pending against Wal-Mart.

What these cases have revealed through evidence and employee testimony is 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. It has been suggested that Wal-Mart’s motivation for settling these lawsuits is not simply to avoid costly defeats in the courtroom, but to tie up issues that might be used by supporters to argue for passage of the Employee Free Choice Act.

Thousands of employees have sued Wal-Mart for unpaid overtime and unfair break practices, so-called “wage and hour” suits. Download our fact sheets to learn more about these suits, and the most recent settlement.

Wal-Mart Wage and Hour Settlement (PDF)

Wal-Mart Wage and Hour Litigation Stipulation Regarding Stay of Proceedings (PDF)

Wal-Mart’s Wage and Hour Violations (PDF)

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Come holiday season, what do you get the company that seemingly has everything? How about a settlement to its seemingly endless chain of wage and overtime suits.

We ring in the new year with this news, that Wal-Mart has chosen to settle a massive number of wage/hour and overtime class actions. The terms of the settlement could eventually cost Wal-Mart up to $640 million to settle 63 of the nearly 80 such lawsuits out there. So why, after years of fighting these suits tooth and nail (winning some while others have ended in rather large judgments against the company), has Wal-Mart finally decided to settle? At least one law professor quoted in the Wall Street Journal has an idea:

Paul M. Secunda, an associate professor at Marquette University Law School, suggested Wal-Mart wanted to settle the lawsuits not just to avoid potentially more costly defeats in the courtroom, but to resolve issues that might be used to argue for passage of the Employee Free Choice Act. The legislation, expected to be considered by Congress next year, is fiercely opposed by Wal-Mart because the company worries it will make it easier for workers to unionize. Secunda said: “This is part of their overall strategy to get their labor house in order, and compared to what unionization might cost them, I think they probably realized it was a small price to pay.”

A small price to pay indeed. Wal-Mart has prevailed in getting class actions such as these decertified more times than the company has lost, though when it has and Wal-Mart has gone to trial, the judgments in just a handful of cases have totalled over $300 million. Settling 63 for just over $10 million each might not be so bad, especially if it earns the company some good street cred. Could a settlement in Dukes v. Wal-Mart be next??

Wal-Mart and Plaintiffs’ Counsel Announce Settlement of Most Wage and Hour Class Action Lawsuits Against the Company [Press Release via MarketWatch]

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In a recent Minnesota “wage and hour” lawsuit, Judge Robert R. King Jr. found Wal-Mart kept inadequate records of employees’ hours and fined the mega retailer for violating state law 1.5 million times. A story out today from Arkansas Business condemns Wal-Mart even further, explaining that managers actively knew that employees were not taking mandatory breaks - a violation of labor law - yet due to pressure to keep labor costs down, did nothing about it.

Wal-Mart’s low prices are made possible by strategies like this. Cutting labor costs - by keeping wages low, preventing employees from earning seniority (and benefits) and denying mandatory breaks - are why Wal-Mart’s prices are so low. But these strategies are often unsustainable, and when the company faces legal fines of up to two billion dollars for its labor violations, it makes a low-wage/poor-benefit model seem like a pretty bad plan in the long run. Wal-Mart’s iron-fisted approach to payroll spending has been the key to its success, but may ultimately be its downfall as well.

To learn more about Wal-Mart’s wage and hour violations, download our fact sheet, “Saving Money on the Backs of Employees.” (PDF)

Wal-Mart Knew of Labor Violations, Documents Show [Arkansas Business]

Wal-Mart managers were told in 2000 that employees were not taking breaks required under company policy and state laws, but ignored the findings of the company’s own internal audit, court documents show.

“Stores were not in compliance with company and state regulations concerning the allotment of breaks and meals,” said the report, referred to as the Shipley Audit. A judge said Wal-Mart’s management, instead of responding to the audit’s findings, “put their heads in the sand.”

Wal-Mart Stores Inc. now faces more than 70 lawsuits across the country accusing the Bentonville retailer of failing to award rest or meal breaks to its employees or forcing employees to work off the clock without pay.

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