|
The
Philadelphia
Inquirer
Wal-Mart ordered to
pay $62.3 million
to current, former
workers
By Jane M. Von
Bergen, philly.com from the Web, October 3, 2007
A Philadelphia judge today ordered
Wal-Mart Stores Inc. to pay $62.3 million in penalties to 124,506 current and
former Pennsylvania employees of the company who were not paid when they worked
during rest breaks.
The award by Common Pleas Judge Mark I. Bernstein, which amounts to about $500
per worker, came on top of the $78.5 million awarded by a Philadelphia jury
nearly a year ago after a five-week trial in the class-action case.
"I think the judge properly delivered a firm corporate spanking to Wal-Mart,"
said lawyer Michael Donovan, of Donovan Searles L.L.C., of Philadelphia, which
represented the workers.
In a statement, Wal-Mart said it disagreed with the judge's and jury's decisions
in the case. "It is our policy to pay every associate for every hour
worked," spokeswoman Sharon Weber said.
"Many employees testified that they skipped or cut short their rest breaks by
their own choice," Weber said. "While we discourage this practice, an
employer should not be penalized when employees do this on their own."
Last October, the jury found that Wal-Mart did not compensate workers for time
they had worked without pay and for missed breaks and that the company had no
good reason for this. The jury found that Wal-Mart had saved more than $49
million by not paying workers properly. "The jury found the defendant
Wal-Mart abused their workers" in a way that can be remedied by the Pennsylvania
Wage Payment and Collection Law, the judge wrote in his opinion.
The class in the case numbers 187,000 workers and covers pay missed between
March 1998 and May 2006. The $62.3 million extra applies to 124,506
workers employed between January 2002 and May 2006, while the statute of
limitations was still in effect.
Wal-Mart said it now employed 51,497 people in Pennsylvania and about 6,550 in
Philadelphia and its Pennsylvania suburbs. There are 145 Wal-Mart and
Sam's Club stores in the state.
In his 12-page opinion, Bernstein stressed the importance of compensating
workers for their time.
"The law in its majesty applies equally to highly paid executives and
minimum-wage clerks," he wrote. "Just as highly paid executives' promised
equity interests ... are protected fringe benefits and wage supplements ..., so
too [are] the monetary equivalents of 'paid break' time cashiers and other
employees were prohibited from taking."
Former Wal-Mart cashier and customer-service representative Jacqueline Copeland,
now a nurse, agreed. "I think the judge made the right decision," she said
in an interview yesterday. You can't have people work for you and not pay
them."
Copeland, of South Philadelphia, worked at the Wal-Mart on Columbus Boulevard in
Philadelphia from 1999 until 2002.
For Wal-Mart, today's ruling comes as the company has been working to improve
its public image in the face of ongoing criticism about its business practices.
Wal-Mart, for example, has launched a major "green" push led by a former Sierra
Club president. Environmentalists continue to criticize Wal-Mart's
contribution to rural and suburban sprawl.
Wal-Mart executives and some union leaders have stood side-by-side, vowing to
work to improve health care for Americans, and the chain now sells many
low-priced generic drugs in its pharmacy.
Wal-Mart had been stung by criticism that its workers were so poorly paid that
they could not afford company-offered health insurance for their families.
And unions have long -- and unsuccessfully -- fought to organize employees of
the Arkansas-based chain.
There are as many as 80 wage-and-hour suits against Wal-Mart around the country,
although not all of them are class actions.
Wal-Mart faces class-action suits in New Jersey, Missouri and South Carolina,
but staved off class certification in New York, Maryland and Illinois. In
California, a jury awarded Wal-Mart workers $172 million in a class-action suit
in 2005.
The cases involve some combination of missed lunch or rest breaks, or time
worked off the clock without pay.
"What kind of image does the company have if it appears to not treat its workers
in accord with the law?" said University of Richmond law professor Carl Tobias,
who follows the Wal-Mart cases.
Bernstein's ruling came as a Minnesota judge continued to hear testimony today
in a class-action case involving the same wage-and-hour issues. That case
involves 56,000 Wal-Mart employees and began Sept. 25.
In the Philadelphia case, the jury found in Wal-Mart's favor on the lunch-break
issue: Employees did receive their lunch breaks.
The $78.5 million awarded to current and former Wal-Mart employees last October
was to compensate them for their lost pay. During the trial, Wal-Mart
attorney Neal Manne, of Houston, suggested to the jury that $8 million would be
enough.
At the time, Manne said Wal-Mart would appeal. Weber today would not
discuss Wal-Mart's legal plans.
No money has reached plaintiffs -- or their attorneys -- pending possible
appeals in the case.
The judge's ruling today involves penalties in connection with the Pennsylvania
Wage Payment and Collection Law. The $62.3 million will add to money
received by 124,506 workers affected from 2002 to 2006.
There are still outstanding issues in the case. The judge must decide
whether to require Wal-Mart to pay $10 million in interest on the amount of
money owed to employees who missed breaks between 1998 and 2002. The
workers are divided into two groups based on the statute of limitations.
Also undecided is what proportion of the $48 million in plaintiffs' attorneys'
fees in the case will be paid by Wal-Mart.
Donovan's firm will not get the entire $48 million. He and his firm were
assisted by other attorneys across the nation who share discovery strategies and
expertise in these large and data-intense cases.
Contact staff writer Jane M. Von Bergen at 215-854-2769 or
jvonbergen@phillynews.com.
|
