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2009-02-22
Walterboro, S.C. Wal-Mart Holds Clearance Sale on Lawsuits

Wal-Mart is trying to clear out its legal closet by buying off scores of "old" lawsuits brought by its own workers that have been sitting on the racks for years. This week, a judge in Colleton County, South Carolina approved a Wal-Mart settlement in a $49 million class action lawsuit -- one of as many as 76 similar wage and hour class action lawsuits filed across America against the nation's largest private employer. Wal-Mart has the largest selection of lawsuits of any retailer in American history. The South Carolina case, known as Carter v. Wal-Mart, was originally filed roughly six years ago. In a prepared statement approved by Wal-Mart, the lawyers representing the plaintiffs said, "We are pleased with the preliminary approval of the settlement by the Court. We hope that Wal-Mart's industry-leading compliance model will set an example for the retail industry." As part of the settlement, Wal-Mart agreed to continue to maintain electronic systems, surveys, and notices that will protect the rights of workers. "This lawsuit was filed years ago and the allegations are not representative of the company we are today," a Wal-Mart spokesperson said in a press released dated February 18, 2009. "Our policy is to pay associates for every hour worked and to make rest and meal breaks available. This is a commitment we make to the more than 1.4 million associates who choose to work for Wal-Mart and serve our customers and members every day. We have worked hard to have the right communication, processes, and systems in place to help ensure we live up to this commitment." Two days later, on February 20, 2009, the lawsuit clearance sale continued, when Wal-Mart announced another case had been settled. On January 22nd, Wal-Mart entered into an agreement to settle the claims asserted in a class action lawsuit known as Daryal Nelson and Tommy Armstrong v. Wal-Mart, Inc. and Wal-Mart Transportation LLC, which was pending in the U.S. District Court for the Eastern District of Arkansas. In the lawsuit, the Plaintiffs asserted that Wal-Mart had discriminated against African Americans truck drivers on the basis of race in recruitment and hiring for the position of over-the-road truck driver in Wal-Mart's private fleet. The lawsuit was filed in 2004 by Daryal Nelson, who claimed that he was rejected for a truck driver position because of his race. The lawsuit was given class-action status last May. Wal-Mart denied that it engaged in any policy or pattern or practice of unlawful discrimination, or other unlawful conduct. The settlement had to be approved by the courts, and on February 20th, the attorneys for the truck drivers submitted the formal settlement documents to the court with a request for approval. "Resolving this litigation is in the best interest of our company, our shareholders and our associates," said a Wal-Mart spokesperson. "Encouraging diversity is an important part of the hiring process for all areas of our company. We are implementing improvements to our transportation division's recruitment, selection and personnel systems and believe they will be an integral part of our commitment to diversity." Under the truck driver agreement, Wal-Mart and its insurance carrier will pay $17.5 million. Also, Wal-Mart's Logistics Division has agreed to provide priority job placements to 23 of the class members who submit approved claim forms; to provide direct notice of all future job opportunities to all interested class members; to establish benchmark hiring goals so that the composition of future hires, by race, is proportionate to the racial composition of the applicants; to select a diversity recruiter, and to enhance its recruitment efforts and advertising targeted to African-Americans. "We are very pleased with the settlement," said Hank Bates, an attorney representing the class of African-American truck drivers, in a joint statement approved by Wal-Mart. "This is an excellent result for the class both in terms of the 17.5 million dollars in monetary relief and in terms of Wal-Mart's commitments to job placements, equal opportunity and enhanced recruitment efforts moving forward." This week, a third case was cleaned off the books in Missouri. According to the St. Louis Business Journal, Missouri workers at Wal-Mart will get $55.5 million as part of a multistate settlement the company agreed to in December regarding a wage-and-hour-abuse case against it. Steve Long, a Denver-based partner with the lawfirm of Polsinelli Shughart, said that the actual settlement amount with Missouri Wal-Mart hourly workers was $90 million. The net amount of $55.5 million comes after attorneys fees and costs for Polsinelli and three other law firms. A Jackson County Circuit Court Judge entered an order Feb. 12 granting preliminary approval to the settlement against Wal-Mart in Missouri. An estimated 330,000 present and former Wal-Mart employees in Missouri will share in the proceeds. The class includes people who were employed between August 15, 1996, and Jan. 2, 2009. Wal-Mart said Wednesday that the settlement requires it "to continue to maintain electronic systems, surveys and notices that will protect the rights of workers. The lawyer for the plaintiffs added, "Although the claims by Wal-Mart's hourly associates in Missouri took more than seven years to be fully resolved, changes to working conditions complained of by our clients began many years ago, and through this settlement those beneficial improvements are guaranteed to continue." The suit's allegations "are not representative of the company we are today," a Wal-Mart spokeswoman said. "Our policy is to pay associates for every hour worked and to make rest and meal breaks available."

What you can do: There are really two Wal-Marts: the one that did all this damage to its own workers and job applicants, and "the company we are today." Wal-Mart is trying to vindicate itself from this plethora of lawsuits by saying, in essence, "we were bad back then, but we've reformed our ways now. This statement is a repudiation of the Lee Scott era at Wal-Mart, which lasted from 2000 to 2009. Scott was at the helm of Wal-Mart during the filing of most of these lawsuits. When the courts granted class action status to these cases, the company had two choices: spend a fortune fighting these class actions in court, with the risk of an enormous financial verdict against them, or, settle for a smaller sum and put the cases behind them. Wal-Mart has chosen to follow the settlement route, and to claim that whatever it was doing during the Lee Scott years, was "not representative of the company we are today." These settlements were actually negotiated during the final months of Lee Scott's tenure, so the concept that Wal-Mart has reformed itself over time is just not true. These cases were settled for one simple reason: to prevent a greater financial expense later. All the internal checks and balances that Wal-Mart says it will now put in place to better protect the rights of workers, came only as the result of litigation. The biggest class action suit of all, the gender discrimination case of Dukes V. Wal-Mart, has not be settled, because Wal-Mart is still challenging the class action certification in the Dukes case. If Wal-Mart can get the class action status of the Dukes case overturned, the company's stands to avoid several billion dollars in settlement costs. If the courts rule that Dukes is a class action lawsuit, Wal-Mart will no doubt settle that case too -- but it will be extremely expensive, and will have material impact on the company's bottom line. Readers are urged to email Wal-Mart's corporate headquarters at http://walmartstores.com/contactus/feedback.aspx with the following message: "Dear Wal-Mart, It's great to see you settling all these outstanding lawsuits against you. Once you finish clearing out all these old cases, you can make room for new ones, perhaps? But you forgot to deal with the biggest case in your closet: Dukes v. Wal-Mart. You have kept more than 2 million of your current and former Wal-Mart workers in limbo for years. These women want to be hired, promoted and paid just like the men who become your 'associates.' The company that Wal-Mart is today should settle this case, and stop trying to challenge the class action certification. Until you settle this case, the Wal-Mart that was sued by its workers over the past decade, is still the same company today."










 
 
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