Wal-Mart Hit Hard in Attempted Evasion of Fair Pay to Employees
Though compliance with a state’s applicable wage and hour act is mandatory for employers, some companies try to get around this duty by devising systems where employees are not actually on the clock or are supposed to be on break when actually working. [more on past lawsuits where companies strategized to avoid paying employees proper wages]. A recent Pennsylvania lawsuit against one of that nation’s largest employers proved some tactics to be extremely detrimental to the employer.
In 2006, over 186,000 current and former Wal-Mart employees originally brought a lawsuit for damages resulting from alleged missed rest and meal breaks and mandated “off the clock” work in defendant’s Pennsylvania stores. Pennsylvania’s wage payment and collection law (WPCL) can require employers who fail to pay wages, without a good faith reason to withhold payment, to pay, whichever is greater, liquidated damages of $500 or up to 25 percent of the total amount of wages due. Former employees of Wal-Mart claimed that the company made workers skip more than 33 million rest breaks from 1998 to 2001 to boost productivity and lessen labor costs. Plaintiffs complained that one of Wal-Mart’s secrets for its profitability is its implementation of a system that encourages off-the-clock work for its hourly employees.
Plaintiffs prevailed in the original 2006 class action where Judge Mark I. Bernstein originally awarded the current and former workers over $187 million. A few months ago in October 2007, the judge awarded an additional $62 million in statutory liquidated damages for over 124,000 of the plaintiffs who worked after January 1, 2002. This increased the total award to over $141.1 million in damages that Wal-Mart must pay.
