Wal-Mart didn’t give its California workers a break, so now the workers aren’t giving Wal-Mart a break. In December, 2005, an Oakland, California jury awarded $172 million to 116,000 Wal-Mart workers who were systematically denied lunch breaks between 1998 and 2001. But now those same workers charge that the company has not changed its way, and they want the court to intervene to require Wal-Mart to be monitored for compliance with wage laws. California is one of a handful of states in the nation that fines employers for violation of meal-break rules. The 3 year old law entitles employees who work more than five hours without a meal break to sue for one hour of pay for each missed meal going back as much as three years. The Wal-Mart case, Savaglio v. Wal-Mart, was the biggest single case in the nation. The class action suit accused Wal-Mart of denying as many as 204,000 current and former California employees of pay for missed lunch and rest breaks. Federal law does not require meal or rest breaks, no matter how long the shift, although most employers provide some sort of meal break. But in states that don’t follow federal law, and have their own meal and rest break requirements, suits for denial of breaks have been brought in other states. Wal-Mart faces a similar lawsuit in Massachusetts. Despite the verdict against it, a spokesman for the retailer said, “Wal-Mart’s policy is to pay associates for every minute they work.” According to the lawyers who won the verdict in the Savaglio case, Wal-Mart continues to violate California law. Plaintiff’s lawyers want Wal-Mart to have a court-appointed supervisor to make sure they obey state wage laws. That issue will be decided this summer by a judge in the Alameda County, California Superior Court. According to The Recorder, Wal-Mart argues that the company is now complying with all meal and rest laws, and that court supervision is not needed. But the plaintiffs want the court to appoint a monitor to force Wal-Mart to undertake audits and report its compliance, and for the store to give its own employees notice of the injunction. The lawyers seek an additional $5 million in restitution for meal break violations between October and December 2000. The workers also want a court order preventing Wal-Mart from asking employees to sign away their right to meal breaks, something they say often occurs at the retailer under coercive conditions. The workers also say Wal-Mart should be required to stop using a system that automatically clocks employees in and out for their meal breaks, which hides the true duration of their lunch. They charge that Wal-Mart has a history of ignoring even its own studies showing it was not following the law. “Even today, after the jury in this case found Wal-Mart liable for punitive damages, Wal-Mart continues to violate specific provisions of both the California Labor Code and Industrial Welfare Commission Wage Orders,” the plaintiffs charge.
Wal-Mart claims that it has worked hard on the issue of meal and rest break compliance in its stores, making enhancements such as an automated procedure that keeps track of employee meal breaks. The company is also appealing the jury verdict from last December. In its 2006 Annual Report, Wal-Mart writes, “The Company believes that it has substantial defenses to the claims at issue, and intends to challenge the verdict in post-trial motions, and, if necessary, on appeal.”
Wal-Mart is also facing at least two lawsuits over its Associates’ incentive bonus plans in California. The company has settled one case, but says that financial settlement will “not have a material impact on the company’s financial condition or results of operations.” For a description of other Wal-Mart legal problems, go to their website, www.walmart.com, and look up their most recent annual report to the Securities & Exchange Commission (SEC). In the document you will find a section title “litigation” which summarizes the company’s massive legal entanglements. You can also search Newflash by “legal” for similar stories.
