Unfortunately, a drop in the bucket for Wal-Mart
I can’t believe this isn’t posted already. Gentlemen, I think we’re slipping.
Bloomberg (via Wal-Mart Watch):
Wal-Mart Stores Inc., the world’s largest retailer, owes its hourly employees in Pennsylvania $78 million for unpaid rest breaks and hours worked beyond their regular shifts, a jury ruled today in a class action lawsuit.
Jurors in state court in Philadelphia assessed the damages after 2 hours of deliberations. Yesterday, the 12-member panel sided with two former Wal-Mart employees, finding the company forced workers to miss rest breaks and work later hours without pay. The jury said the company did provide unpaid meal breaks as required by law.
Today’s verdict is Wal-Mart’s second multimillion dollar loss in a group-employee lawsuit filed over wages in less than a year. In December, a California jury awarded $172.3 million to the company’s workers for missed meal breaks. In August, the judge in that case ordered Wal-Mart to obey state laws requiring rest breaks. More than 70 similar wage-and-hour suits have been filed against the Bentonville, Arkansas-based company.
“Wal-Mart still continues to cheat its workers. We’re not the ones that are the liars—they are,†Dolores Hummel, 53, one of the lead plaintiffs in the case, said before the verdict.
From my own experience working for the company, I still believe it’s a stretch to accuse Wal-Mart of systemic abuses. They forced me to take breaks when they knew I was skipping them (Hmm…maybe I should try to get in on the action. There must be such a lawsuit in my state.). They also threatened us with demotion or even termination if we failed to give the cashiers breaks, in accordance with company policy. Furthermore, I never saw anything to indicate that Bentonville directed such behavior. I know this is anecdotal evidence, but at least it implies that this was not a company-wide occurrence.
I’m not going to try to say it didn’t happen, or even that no one in Bentonville knew about it. However, I find it difficult to believe that 187,000 workers in one state were “victims.”
Anyway, Wal-Mart will appeal, lose, and eventually pay out the $417 per person. Let’s see $78,000,000 / 1,300,000 = $60/associate. That’s what 8 hours per employee. It takes Wal-Mart 8 weeks to recoup the loss.
Actually it takes almost no time to recoup a “loss” from paying a fine. It can be deducted as a business expense. That’s right, the IRS considers penalties for breaking the law a legitimate business expense.
[...] Yesterday, I reported on the $78 million that Wal-Mart now owes workers in PA for stealing their time. Well, I just found Wal-Mart’s statement on the verdict. Here’s the part I want to focus on: Wal-Mart also has installed automatic systems that help to make sure that associates receive their meal breaks and that they do not work off the clock. For example, we have programmed the cash registers in our stores to provide each cashier with advance notice before each meal period, and then to lock the user out before the break becomes overdue. And we have programmed all electronic systems that require associate log-on so that they cannot be operated by an associate who has not clocked in. [...]
[...] Some say this is a drop in the bucket for a place like Wal-Mart. But it won’t be once it’s multiplied by those 70 other suits! [...]
Robert-
I don’t know much about tax laws. I can do my own taxes and that’s about it. So if what you say is correct (and I have no reason to believe it isn’t), then that’s good for Wal-Mart. For my part, I was only meaning to imply that the company will cut hours to offset the cost.
When the workers each receive their $60, it will be thrown in with their paycheck and taxes will be deducted from it and some may hit a higher tax bracket because of it and end up losing more of it than others! What else is new?
[...] This week, a jury in Pennsylvania awarded $78 million to plantiffs in a class-action lawsuit against Wal-Mart. The jury found, after deliberating for two hours, that Wal-Mart was at fault for making employees miss breaks, cut breaks short, and work without pay. Coverage via Bloomberg and The Writing on the Wal. [...]
Shalom Robert,
Actually, we didn’t miss it. It was posted yesterday.
B’shalom,
Jeff