Wal-Mart Pay Lawsuit Damage Award Pot Sweetened to $140M

October 3, 2007 (PLANSPONSOR.com) - A Pennsylvania state judge has dramatically increased to $140.8 million the damage award to Keystone State Wal-Mart workers who won a class-action lawsuit over uncompensated work time.

Philadelphia Common Pleas Judge Mark Bernstein added $62.3 million to the total, resulting in payments to about 125,000 employees awarded under a Pennsylvania law forbidding employers from holding back pay without cause for more than a month, according to an Associated Press news report.

The Pennsylvania class-action suit involves 187,000 current and former employees who worked at Wal-Mart and Sam’s Clubs from March 1998 through May 2006. The initial $78.5 million award represented the wages lost by those workers (See    PA Judge Approves Class in Wal-Mart Break Pay Case ).

A smaller number – about 125,000 – qualified for the most recent damage award. The others were excluded by legal time limits and are seeking interest on the back wages.

“Just as highly paid executives’ promised equity interests or put options or percentage of sale proceeds are protected fringe benefits and wage supplements, so too the monetary equivalents of ‘paid break’ time cashiers and other employees were prohibited from taking are protected fringe benefits and wage supplements,” Philadelphia Common Pleas Judge Mark Bernstein wrote, the news report said.

Bernstein added: “The law in its majesty applies equally to highly paid executives and minimum wage clerks.”

In 2006, a Common Pleas Court jury in Philadelphia turned aside the giant retailer’s assertions that some workers had chosen to continue working despite their breaks and that, in general, having workers stay on the job for a few extra minutes was not significant.

According to the news report, a Wal-Mart spokeswoman said the company discourages employees from working off the clock and disciplines managers who permit it. “Many employees testified that they skipped rest breaks by choice. While we discourage that practice, employers should not be penalized when employees do that on their own,” spokeswoman Sharon Weber, told the Associated Press.

Similar suits charging that Wal-Mart violated state wage laws are in play across the country. A California trial ended with a $172 million verdict that Wal-Mart is appealing while the Bentonville, Arkansas-based company settled a Colorado suit for $50 million. A trial opened last week in Minnesota while suits are pending in New Jersey and several other states.