Compliance December 23, 2005

Golden State Jury Hits Wal-Mart with $172M Verdict in Lunch Break Case

December 23, 2005 (PLANSPONSOR.com) - A California state court jury has hit Wal-Mart Stores with a $172 million verdict for not giving about 116,000 current and ex-employees an unpaid lunch break required under a state law.
Reported by

The world’s largest retailer was ordered to pay $57 million in general damages and $115 million in punitive damages for violating a 2001 state law, according to news media reports. That law requires the 30-minute meal break for employees who work at least six hours.

For its part, Wal-Mart said it paid some employees their penalty pay and, in 2003, most workers agreed to waive their meal periods as the law allows. The lawsuit covers former and current employees in California from 2001 to 2005.

Plaintiff lawyer Fred Furth said outside court that the jury “held Wal-Mart to account,” according to the news reports.

Wal-Mart attorney Neal Manne said the jury’s verdict would be appealed. He claimed the lunch break law could only be enforced by California regulators, not by workers in a courtroom and that the retailer did not believe the lunch law allowed for punitive damages.

“We absolutely disagree with their findings,” Manne said of the jury’s verdict. He conceded that Wal-Mart made mistakes in not always allowing for lunch breaks when the 2001 law took effect, but said the company is “100% ” in compliance now.

The lawsuit was filed by several former Wal-Mart employees in the San Francisco Bay area in 2001, but it took four years of legal wrangling to get to trial.

«