Wal-Mart Settles Illegal Floor Cleaners Suit

March 18, 2005 (PLANSPONSOR.com) - Wal-Mart Stores Inc. has agreed to pay $11 million to settle a civil suit brought on by federal authorities over charges that it employed illegal immigrants through outsourcing contracts.

The settlement will end any further litigation, either civil or criminal, on charges that the giant retailer knowingly hired floor cleaning contractors who had illegal immigrants for employees, according to a statement from the company. The settlement also requires the retailer to create an internal program that will ensure that compliance with immigration laws occurs by both the store and any outside contractors.

Wal-Mart asserted that it did not know that the workers were illegal immigrants when it hired the contractors.

The settlement brings to an end a four-year Justice Department investigation into employment practices of its former floor cleaning contractors, according to Wal-Mart. In 2003, raids on Wal-Mart stores netted 250 illegal immigrants working in 61 stores.

The company has said that it has now required all floor cleaning at its US stores to be done by Wal-Mart associates, not outsourced workers.

Wal-Mart has faced other problems with employment practices throughout the years. In February, the company lost a multi-million dollar discrimination suit filed by a former worker who has cerebral palsy.