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Settlement May Cost Wal-Mart Up To $640 Million

Posted by Chrissie Cole
Wednesday, December 24, 2008 12:06 AM EST
Category: In The Workplace
Tags: Wal-Mart, Worker's Compensation, Employment Law, Labor Law


IMAGE SOURCE: Wikimedia Commons/ generic Wal-Mart exterior/ author: Sven

Wal-Mart Stores Inc., will pay between $352 and $640 million to settle 63 wage and hour abuse lawsuits against the company.

The settlement ends pending actions in several state courts and in Nevada federal court and occurs two weeks after a December 9 agreement was reached in Minnesota that claims the company cheated hourly workers and forced them to work through breaks.

As a result of the agreements, each of which must be approved by a trial judge, the world's largest retailer said it would take a $250 million after-tax charge during its fiscal fourth quarter ending Jan. 31.

We are pleased with the settlement and feel it is "fair and reasonable” for our clients,” said attorney Frank Azar, who represents workers in 14 states. "The company has made tremendous strides in wage-and-hour compliance."

Similar cases outstanding in California, Massachusetts and Pennsylvania were not on the list of settled lawsuits provided by the company. A Wal-Mart spokesman declined comment.

Settlement Amounts

The newly settled cases involved hundreds of thousands of current and former hourly employees. It is unclear how much the average employee will receive, but the sum could be several hundred dollars.

The settlements included three cases that were scheduled for trial in 2009, on behalf of workers in Missouri, New Mexico and Washington.

A company spokesman says the company is committed to paying its workers for all hours worked. Managers who do not allow meal breaks and violate other policies are subject to being dismissed, says the company. The company will maintain an electronic system and comply with wage and hour policies and Minnesota law as part of the agreements.

Minnesota Settlement

On December 9, the company agreed to pay $54.3 million to settle a class-action suit by Minnesota hourly workers that claimed violations of wage-and-hour laws. In July, the judge found the company violated wage-and-hour laws more than 2 million times and ordered the $6.5 million in back pay for employees paid by Wal-Mart.

Wal-Mart avoided a trial scheduled next month by settling, in which a jury would have been asked to order the company to pay as much up to $2 billion in back wages and punitive damages.

In Pennsylvania, workers won more than $78 million in 2006 for having to work through breaks and off the clock. In California, Wal-Mart had to pay a $172 million for denying lunch breaks. Appeals are pending in those cases.

Former employees and some shoppers at Wal-Mart tell their stories on the web site Walmartsucks.com.

This above YouTube video tells another story of a former employee who was brain-dead after an accident then had to pay Wal-Mart settlement she received from an insurance company.

A wrongful death lawsuit will be filed in the death of a temporary guard who was killed in a Wal-Mart stampede on Black Friday.

The three sisters and brother of Jdimytai Damour have plans to file after Damour, 34, a 6-foot 5-inch, 270-pound temporary worker died the day after Thanksgiving when he was trampled by thousands of shoppers eager to get into a 5 a.m. sale at Wal-Mart in Valley Stream, Long Island.

A full list of settled wages can be viewed on Wal-Mart's Web-site. #

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