Jun 14, 2011

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The Walmart Wage & Hour Train Rolls On

News came yesterday that Walmart lost its appeal of a $187.6 Million verdict in a Pennsylvania wage & hour case originally tried back in 2006.  The suit alleged that 187,000 workers were denied their right to rest and lunch breaks under Pennsylvania state law. The case was notable because Walmart attempted to distance itself from its own documentation of time records for its PA employees, claiming that the timesheets were too faulty to be trusted.

The Plaintiffs argued that local managers were under ever-increasing pressure to cut costs, resulting in chronic understaffing that led some workers to work through their breaks, whether or not they were still on the clock. Walmart claimed the records that showed when employees punched in or out were too inaccurate to be used as legal evidence.

The Pennsylvania Superior Court apparently wasn’t thrilled with the argument, noting that the company’s own internal investigations had revealed illegal “off-the-clock” work. According to the Plaintiff’s Attorney’s press release, Walmart also tried to argue that it had been denied due process because the trial court refused to let it question each individual class member regarding their hours worked.

It wasn’t a total loss, though – the Court said that some of the plaintiff’s attorney’s fees were counted twice, and would have to be recalculated. That’s a drop in the bucket compared the the verdict and add-on penalties levied against the company. For a great breakdown of how the Pennsylvania Wage Payment and Collection Law turned a $49 Million verdict into $187 Million payout, see Phillip K. Miles’s Lawffice Space post here.

A Walmart spokesman said they are looking forward to further appeal.

All the while, the world is waiting with bated breath to see what the Supreme Court has to say about Dukes v. Wal-Mart, the biggest wage-and-hour class action ever1, which finally made its way to Washington. Though it is on the tip of every employment lawyer’s tongue, the question before SCOTUS doesn’t have that much to do with the wages or hours of Walmart employees, and everything to do with the nature and future of class actions in American jurisprudence.

The question before the Court is not whether Walmart violated any wage laws, but whether a class of this size – all women who worked for Walmart between 1998 and now – is really ever fair. Walmart is arguing that it is impossible for every women it’s employed for the past 13 years to have enough in common to be certified as a single class.

Oral arguments in that case are over (and seemed to go well for the retailer), and the decision is expected early this summer.

1. I think. Am I wrong about this? [↩]