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Walmart Forced to Pay $188 Million in Class Action Lawsuit Over Wage Theft

By Reuters

17 December 14

he Pennsylvania Supreme Court ordered Wal-Mart Stores Inc to pay $188 million to employees who had sued the retailer for failing to compensate them for rest breaks and all hours worked.

Wal-Mart said on Tuesday that it might appeal the decision, which upheld lower court rulings, to the U.S. Supreme Court.

Monday's ruling on the class-action lawsuit will reduce Wal-Mart's earnings for the quarter ending on Jan. 31 by 6 cents a share, the company said in a securities filing. That amounts to roughly 4 percent of its profit forecast of $1.46 to $1.56 for the period.

Wal-Mart shares were up 0.5 percent at $84.39 in midday New York Stock Exchange trading.

The Pennsylvania Supreme Court upheld a 2007 lower court ruling in favor of the workers, who said Wal-Mart failed to pay them for all hours worked and prevented them from taking full meal and rest breaks.

Wal-Mart spokeswoman Brooke Buchanan said the company did not believe the claims should be grouped together in a class-action suit. "Walmart has had strong policies in place to make sure all associates receive their appropriate pay and break periods," she said.

The decision, which affects about 187,000 Wal-Mart employees who worked in Pennsylvania between 1998 and 2006, marks the second unfavorable ruling in a week for the retailer, the largest private employer in the United States.

On Dec. 9, a National Labor Relations Board administrative law judge found Wal-Mart had threatened employees trying to organize workers at two stores in California.

That ruling was seen as a victory for workers' rights groups who have been challenging the retailer to boost wages and benefits.

A Wal-Mart spokesman said the company did not agree with some of the judge's decisions in that case and was evaluating its next steps.