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Wal-Mart loses $187.6 million appeal over worker breaks

By Reuters
Tuesday, June 14, 2011 8:23 EDT
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NEW YORK/CHICAGO (Reuters) – Wal-Mart Stores Inc has lost its appeal of most of a $187.6 million verdict for Pennsylvania hourly workers who accused the world’s largest retailer of denying them meal and rest breaks.

A three-judge panel of the Superior Court of Pennsylvania on Friday said there was sufficient evidence for Philadelphia jurors in 2006 to conclude that Wal-Mart’s practices violated state wage and hour laws. It also said Wal-Mart’s own internal review uncovered violations regarding “off-the-clock” work.

The case was brought on behalf of about 187,000 current and former Wal-Mart workers in Pennsylvania from 1998 to 2006.

They contended that the Bentonville, Arkansas-based company’s engaged in improper practices to enhance productivity, boost profit and cut costs.

“The record reflects testimony and documentary evidence suggesting that because of pressure from the home office to reduce labor costs and the availability of significant bonuses for managers based on store profitability, Wal-Mart’s scheduling program created chronic understaffing, leading to widespread rest-break violations,” the appeals court said.

It nonetheless ordered the trial court to recalculate a $45.6 million award of legal fees, saying that court erred by “double-counting” some factors.

“We’re committed to paying our associates for every hour they work and to providing them with meal and rest breaks,” Wal-Mart spokesman Greg Rossiter said. “That’s our policy and we take it very seriously. In this case, we believe that the trial court’s decision was wrong in a number of respects and we look forward to additional review in the courts.”

The case was brought by Michelle Braun and Dolores Hummel, who had respectively worked in Wal-Mart and Sam’s Club stores in eastern Pennsylvania, and drew on evidence from roughly 46 million shifts, court records show.

Judith Spanier, one of the plaintiffs’ lawyers, said in a statement that Wal-Mart wanted to “walk away” from its own business records, saying they were so inaccurate that they could not be used as proof.

Like other large retailers, Wal-Mart is regularly sued by employees who claim unfair treatment.

The U.S. Supreme Court is expected this month to rule on whether a gender bias lawsuit against Wal-Mart may continue to proceed as a class action on behalf of a group believed to exceed 1.5 million current and former female workers.

Wal-Mart shares closed down 10 cents at $52.62.

The cases are Braun et al v. Wal-Mart Stores Inc et al and Hummel et al v. Wal-Mart Stores Inc et al, Superior Court of Pennsylvania, No. A21033/09.

Image credit: Flickr Commons.

(Editing by Steve Orlofsky)

Reuters
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