‘Twas the settlement before Christmas. This one has to go down in the Guinness Records as a legal milestone. Wal-Mart has apparently decided to settle old scores and start the New Year by clearing the decks of 63 lawsuits filed against it by its current and former workers. Together with lawyers representing the plaintiffs, Wal-Mart announced legal agreements that will cost the company and its shareholders between $352 million and $640 million. There goes Wal-Mart’s shiny Christmas sales statistics. These cases have been reported annually by Wal-Mart to its shareholders for many years. How much Wal-Mart ends up paying will depend on how many of its employees file claims. As part of the settlement, Wal-Mart has consented to keep using “various electronic systems” to monitor its compliance with wage laws — the equivalent of an electronic ankle bracelet. “Resolving this litigation is in the best interest of our company, our shareholders and our associates,” said Tom Mars, the attorney that heads Wal-Mart’s vast legal department. “Many of these lawsuits were filed years ago and the allegations are not representative of the company we are today. Our policy is to pay associates for every hour worked and to provide rest and meal breaks. This is a commitment we make to the more than 1.4 million associates who choose to work for Wal-Mart and serve our customers and members every day. We have worked hard to have the right communication, processes and systems in place to help us live up to this commitment.” The joint press release from Wal-Mart and the major law firms that represented the workers quoted several of the plaintiff’s attorneys — all of them full of holiday cheer. Frank Azar, one the lead attorneys, was quoted in Wal-Mart’s release as saying, “We hope Wal-Mart’s compliance programs will serve as an example to other major retailers.” And Attorney Robert Bonsignore, of Bonsignore and Brewer, noted,”As a result of this settlement, Wal-Mart can now say that it has taken action to make its stores a great place to shop and work.” None of the workers who brought these class action lawsuits, or who waited years for their settlement, were quoted.
These workers charged that Wal-Mart basically stole from them, by forcing them to work through breaks, failing to pay them for all hours worked, and neglecting to properly compensate workers for their overtime. Employees claimed that Wal-Mart engaged in “time-shaving,” dropping minutes of time from workers’ pay, saving the company millions of dollars in payroll costs. Fundamentally, these lawsuits accused the company of stealing money from its own workers. The company has been experiencing a major mea culpa this year, with a huge settlement in Minnesota earlier this month, and similar cases in Pennsylvania in 2006, and California in 2005. Wal-Mart boasts that it has beaten back a number of class action lawsuits in other states, but the company has had to settle a fair number of such cases to clear them off the books. Still pending is the massive gender discrimination case known as Dukes v. Wal-Mart, a class action case that is now 7 years old. That lawsuit charges that Wal-Mart engaged in a pattern and practice of discrimination against women in promotions, pay, training, and job assignments. The women seek front pay, back pay, punitive damages, and lawyer’s fees. The class of women included in this lawsuit are all females employed at Wal-Mart at any time since December 26, 1998 who were, or may be, subjected to the pay and management track promotions, policies and practices challenged by the plaintiffs. The class as certified includes a staggering 1.6 million present and former female employees. Wal-Mart is still appealing the class action certification, but warns stockholders that if it loses the Dukes case, “the resulting liability could be material to the Company.” So while lawyers in the wage and hours lawsuits are happy with Settlement Santa, it can hardly be said that Wal-Mart is a “great place to shop and work.” The millions of workers who will file claims now against Wal-Mart would probably not describe their experience at Wal-Mart in quite those terms. “The company we are today” still faces many lawsuits from its own workers, and some of the biggest claims of all will be handled by the company they are tomorrow.
