Labour Law Violations Costly for Wal-Mart

Labour laws vary under different political jurisdictions, but wherever they operate, Wal-Mart, the world's largest retailer, tends to run afoul of the labour code. The most recent example - a repeat performance - was in Pennsylvania.

About 187,000 Wal-Mart workers in that U.S. state previously won a $78.5 million class-action lawsuit for working off the clock. On October 3, they received an encore ruling - forcing the company to pay them an additional $62.3 million in damages - bringing the total award to almost $141 million. The payments made to individual employees following this most recent court decision will range from about $50 to a few thousand dollars, depending on each person's employment history.

In his written decision, the judge who heard the case wrote that "The law in its majesty applies equally to highly paid executives and minimum wage clerks. 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."

According to information presented to the court during the trial, almost 99 percent of the hourly workers experienced at least one rest break violation. A former Wal-Mart employee who played a key role in launching the legal action against the company said she regularly had to work during breaks and after closing time because of work demands. She estimated she worked between eight and 12 hours unpaid each month.

"One of Wal-Mart's undisclosed secrets for its profitability," she stated in her lawsuit, "is its creation and implementation of a system that encourages off-the-clock work for its hourly employees."

She and other former Wal-Mart employees testified during the six-week trial that they were pressured by store managers to skip breaks and cut meals short. They estimated that Wal-Mart made Pennsylvania workers skip more than 33 million rest breaks from 1998 to 2001 to boost productivity and cut labor costs.

One of the lawyers representing the workers said "This is 100 per cent of what we asked for. Ordinary workers are entitled to the same protection under the law as highly paid executives."

The jury rejected Wal-Mart's claim that some people chose to work through breaks or that few minutes of extra work here and there were insignificant.

Pennsylvania is far from the only place where employees have taken legal action against Wal-Mart is response to having to skip breaks. The company lost a court case in California which they've appealed, and in Colorado Wal-Mart settled a similar case at a cost of $50 million. Trials involving similar issues are also underway or about to begin in Minnesota, New Jersey and several other states.

Although there have been no similar lawsuits launched against Wal-Mart in Manitoba, there is no shortage of examples of how the company's actions negatively affect working people. A recent example is Wal-Mart's decision to open one of their Winnipeg stores 24-hours a day on a test basis.

Not only does that 'test' open the door to the possibility of more Wal-Mart stores in Manitoba being open around the clock, it could force other retailers, including those with union employees, to also stay open 24-hours so they can complete on equal footing with Wal-Mart. That would seriously hamper the efforts of retail workers to balance work and family responsibilities.