Last week, Wal-Mart Stores, Inc. announced that they have agreed to pay between $352 million and $640 million to settle 63 wage and hour lawsuits filed against the retailer in 42 different states. The lawsuits accused the company of cheating hourly workers by forcing them to work through breaks and not paying them for overtime.
The wage and hour violation settlement may set a new standard for other companies who have been failing to pay employees according to the requirements of federal labor laws.
In recent years, federal court wage and hour class action filings have surpassed employment discrimination class actions, with claims involving issues such as misclassifying employees as salaried or independent contractors, failing to pay for “off-the-clock” work or on-duty meal breaks, denied reimbursements and miscalculation of commissions and bonuses.
Class action wage and hour lawsuits against Wal-Mart have generated a significant amount of media attention, as the retailer is the largest private employer in the world. The company has lost high profile lawsuits over wage violations in California in 2005 and Pennsylvania in 2006, which resulted in verdicts of $172 million and $78 million respectively for Walmart employees in each state.
Earlier this month, Wal-mart agreed to pay $54.3 million to settle a wage and hour class action lawsuit brought on behalf of workers in Minnesota, after a judge found that the company had violated wage and hour laws more than 2 million times.
Under the terms of this latest settlement, current and former employees in 42 states will receive at least $352 million, and the payments could reach $640 million, depending on the number of claims submitted by affected workers.
According to the New York Times, the Walmart settlement resolves all but 12 pending wage and hour lawsuits against the company. Some advocacy groups have suggested that Walmart settled the claims to avoid becoming the target of increased wage and hour enforcement that is expected under the Obama administration.