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2009-12-02
Boston, MA. Wal-Mart Settles Lawsuit, Gives Workers $40 Million Christmas Gift

Wal-Mart workers in Massachusetts are getting a 'Christmas Bonus' from their employer -- but it's actually money they rightly earned at work, but were never paid. The world's largest retailer has had its legal department working overtime this past year settling a stack of class action lawsuits over wage and hour issues brought by its current and former "associates." But unlike Wal-Mart lawyers -- who get paid for every hour they work -- the lowly hourly worker at Wal-Mart often is not fully paid for 'off the clock' work, rest breaks, and meal breaks. Last year at Christmas, Wal-Mart released a staggering list of 63 separate wage and hour lawsuits that had been settled by the company, at cost ranging from $352 million to $640 million, depending on various trial court approvals. One month later, in January of 2009, Wal-Mart announced another $54 million settlement in a case from Minnesota, followed later by a $172 million settlement in California. In settling these cases, Wal-Mart tried to distance itself from its own past labor transgressions that led to all these class action lawsuits. Typical was Wal-Mart's disclaimer after the Minnesota case: "This lawsuit was filed years ago and the allegations are not representative of the company we are today." Wal-Mart went on the assert that "Our policy is to pay associates for every hour worked and to make rest and meal breaks available." Yet the lawsuits kept coming. This week, 87,000 current and former Wal-Mart workers were covered by the Massachusetts settlement. This agreement itself was a nail-biter, coming only days before the lawsuit was ready to begin trial this week in state court in Woburn, Massachusetts. The court was notified on November 29th that a settlement was being filed. The Baystate lawsuit charged that Wal-Mart forced its hourly workers to work off the clock, and denied them required short breaks. A lawyer for the workers explained to the media that the class of Wal-Mart workers covered in the settlement could get as much as $2,500 in earned pay and benefits, or as little as $400. How much a worker gets will be based on their number of years on the job. One lawyer for the workers -- in a tongue-in-cheek description -- labeled this $40 million payment as a "mini-stimulus" package, as if Wal-Mart were imitating the Federal Government. When the workers finally get their money -- after waiting 8 years since this case was originally filed -- they will spend it in the local economy.

What you can do: As in past cases, Wal-Mart used the same weak defense of its actions. "Resolving these lawsuits is in the best interest of our company, shareholders and associates," a Wal-Mart spokesman said. "These cases were filed years ago and the allegations are not representative of the company we are today." The workers and their legal representatives were originally insisting on a settlement worth $50 million. But Wal-Mart balked at that figure, and the lead plaintiffs in the case, Elaine Polion and Crystal Salvas objected to the original Wal-Mart settlement, saying that only $20 million would actually be paid out by Wal-Mart -- and a good portion of that would go to the lawyers. Polion and Salvas also charged that Wal-Mart had reached an agreement with lawyers who weren't the plaintiff's primary representatives. In the end, the settlement was set at $40 million -- and all of that money will get disbursed. As much as $15 million off the top could go to the attorneys in the case. "This settlement obligates Wal-Mart to pay a full $40 million, with no amounts reverting back to them in the event of unclaimed funds or otherwise," said attorney Philip Gordon, one of the lawyers representing the workers. As in past wage and hour cases, Wal-Mart agreed to put in place better systems for recording worker's hours, including a system that denies workers access to cash registers if they are not clocked in for work. The workers will also be able to phone a 'hotline' to anonymously blow the whistle on the company if rest breaks or meal breaks are skipped, or off the clock work takes place. The total Wal-Mart settlements to date in these wage and hour cases has been estimated at just shy of $1 billion. By not paying its workers what they have rightfully earned, Wal-Mart helped its stockholders and Board of Directors to save money and live better. It also helped Wal-Mart to keep the prices of its cheap underwear low. But because of these settlements, Wal-Mart workers will live a little better -- if only for a few months until their back pay is gone. Readers are urged to contact Wal-Mart media relations at 1-800-331-0085 with the following message: "Congratulations on settling another wage and hour lawsuit in Massachusetts. This is such a lovely Christmas present to your workers in the Baystate -- knowing that after 8 years of litigation you have finally agreed to pay them for every hour worked. Now that you are prepared to pay their arrears, how about raising their wages for 2010, and giving them a health plan that has real value and is affordable?"











 
 
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