Wal-Mart Takes $172 Mil Hit In Lunch Break Case

Discussion
Dec 23, 2005
George Anderson

By George Anderson


Allegations by retail workers that they’ve had breaks cut short or denied altogether by managers when stores are understaffed and/or simply very busy may be as old as retailing itself. Of course, as most retailers understand, what once was an accepted practice doesn’t fly anymore – especially when a jury is involved.


Yesterday, a jury in California decided Wal-Mart was guilty of violating a 2001 state law requiring employers to give a 30-mimute, unpaid lunch break to all employees who work a shift of six hours or more.


The jury awarded $172 million ($57 million in general damages and $115 million in punitive damages) to 116,000 current and former workers who joined in the suit.


Wal-Mart said it would appeal the case. The company argues that California state law does not allow for punitive damages to be assessed. “The meal-period premiums in question are penalties, rather than wages,” it said in the statement. “In short, California law prohibits penalties on top of penalties.”


While acknowledging that some mistakes were made when the California law first went into effect, Wal-Mart maintains it is in 100 percent compliance with it today.


Wal-Mart settled a similar suit in Colorado for $50 million.


Moderator’s Comment: How often do incidents occur today where retail workers are denied breaks or asked to work off the clock, compared to the past?
Why do allegations persist that this practice continues when labor laws are very clear in this regard?

George Anderson – Moderator

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15 Comments on "Wal-Mart Takes $172 Mil Hit In Lunch Break Case"


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Kai Clarke
Guest
15 years 2 months ago

Even Wal-Mart does not deny doing this, only the penalty amount. The key point here is that this is done all of the time in retail. Changing this, unfortunately, does require extra effort, and lawsuits like this help initiate these types of changes. The important part is that Wal-Mart has made these changes and is in compliance. After lawsuits in Colorado and California, Wal-Mart knows that it could potentially be facing a larger set of lawsuits from every state it sells in. Wal-Mart is doing the right thing by acknowledging the problem, fixing it and addressing this up-front. It looks like the new management at Wal-Mart is finally helping change the way their business is done.

Carol Spieckerman
Guest
15 years 2 months ago

I’m with David on this and will add that, just as Sak’s has become the sacrificial lamb for punitive retailer practices towards vendors (while certainly not the worst offender), Wal-Mart is fulfilling that role with employee issues (ditto on offenders). At the risk of telling my own little walked-to-school-in-the-snow story, I built my career on unpaid overtime, staying ’til it got done, and working every weekend I can remember. I guess that would be called abuse these days!

Shirley Jung
Guest
Shirley Jung
15 years 2 months ago
I will comment from both sides of this issue. I have been a store manager for a large major retailer and it was very easy for a manager to go to his office and close the door on the pretext of a meeting or a phone call when the store is busy. Not all managers are as dedicated as hourly employees. I know I have seen this happen more than I can count. I have also been an hourly employee and, from that perspective, they are really not given a choice as to breaks or lunches. It is based only on the store management’s decision. They decide when they can go on break and, in some cases, how long. Some managers can not make a decision when they consider the store to be having down time and they are always concerned as to when they may have upper management visit and not having enough floor help. I don’t consider people who ask for their breaks/lunches when they are entitled to them as not being team… Read more »
Bob Bridwell
Guest
Bob Bridwell
15 years 2 months ago

A way one company worked this out was to schedule less than the minimum hours to require it. If the minimum for a break was 6 hours they scheduled for 5.5 hours. The down side was working 6 days a week and then generally falling below the minimums for full benefits. Or, they simply split the shift, with a full hour or two off.

Both sides have to be flexible. Occasionally, you get busier that anticipated, but trying to control your labor expense by requiring working off the clock is unacceptable.

If they did, they should pay and the managers should be disciplined.

David Livingston
Guest
15 years 2 months ago

If you have never punched a time card, worked on salary or commission all your life, stayed late until the work was done, it’s hard to feel sorry for someone who missed their smoke break because work needed to get done. People should get paid for the time they put in, but being a big crybaby about working a lunch break now and then or off the clock for a few minutes is petty and immature. If an employer abuses this often, then it should be dealt with. When I worked in retail we did this all the time but we always rewarded the loyalty with bonuses and job security. When it came time to lay someone off we always kept the team players and fired the complainers.

Mark Lilien
Guest
15 years 2 months ago

The law varies from state to state, so national chains have to be careful with their supervision. Retailing’s daily work flow, unlike some other industries, seems to come in waves: bunches of customers followed by very few and bunches of large deliveries followed by none. So it’s tempting for supervisors to ask people to work during the heavy waves, even if people haven’t taken breaks during the light times. And many people forget to punch out even if they do take a break. Maybe people should wear RFID devices on their name badges to track break room time.

Craig Sundstrom
Guest
15 years 2 months ago

Curiously, though the case was (apparently) argued here in Oakland, it attracted little attention when it was ongoing….but back to the issue at hand: the plaintiffs may or may not be whiners. The issue, I believe was LUNCH breaks, not smoke breaks – but ultimately the law is what it is. If Wal-Mart and other retailers don’t like it, they should try and change it. For Wal-Mart or its defenders to complain about the law being enforced seems petty and immature. Is the enforcement selective, targeting “big”/high-profile companies? Perhaps, but that’s just one of those things in our imperfect world…. kind of like being asked to work through your break.

Steven Davidson
Guest
Steven Davidson
15 years 2 months ago

I would have to disagree with David calling certain individuals “cry baby’s” for missing their breaks and lunches. Some people need those breaks for a variety of purposes, even medical reasons. If this is a habitual pattern for a company, it needs to be addressed…simple as that. When I started in management, I always made sure that my employees received their breaks and lunches when they were entitled to them. Especially at this time of the year, you need that break where you can compose yourself and recharge your ability to help customers more efficiently. I learned a long time ago at the beginning of my retail career, that “if you can survive a holiday season at Wal-Mart, you can survive any season at any retail store.” This holds true, and also includes timely and well-deserved breaks and lunches.

Bernice Hurst
Guest
15 years 2 months ago

I’m much more inclined to agree with setaylor than with David. The managers have a responsibility and taking action against employees who resist being bullied and demand their rights is not at all right. IF management is regularly and consistently denying employees their breaks then the law needs to be enforced. If head office doesn’t take action then obviously someone else needs to.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
15 years 2 months ago
Michaels Arts and Crafts violates this law every day in every store, if you believe anti-Michaels websites and blogs. Non-union, like Wal-Mart, Michaels is reported to have systemically threatened workers with dismissal if they take breaks or expect to collect overtime pay, and class-action ageism suits are brewing, according to sources. Lawful union visits are routinely turned away, and the mostly-female workforce is intimidated because they’re fearful of losing their family’s health benefits – a major reason for working at Michaels. Again according to internet sources, workers injured on the job are also threatened with dismissal if they choose to stay at home to heal. Some Michaels employees have even lost their jobs after reporting for work in wheelchairs after an on-the-job injury, and then being unable to fit through the narrow aisles in the stores. David Livingston’s comments come from long ago in a galaxy far, far away. Today, employers are all “take” and no “give.” Rather, it’s “take” and “threaten.” If there once was a tacit agreement from employers that “if you help… Read more »
Mark Burr
Guest
15 years 2 months ago
I have to agree with Doc Banks on this issue. Carol and David are way off on this one. This isn’t about working hard. It’s not about working weekends. It’s not about employees complaining about having to pitch in a bit more when it’s busy, etc, etc. Your stories are a wonderful view of a happier day, but your insight into the issue is off base. Your comments sound like near contempt for today’s retail worker rooted in a memory of a fonder day. This issue is about a systematic abuse of the rules. It’s not even close to a missed break here and there. This is about the regular and intentional abuse of the worker. Anyone who believes that a worker needing a break after six hours is a cry baby would likely do well in the auto plants in the 1920’s, but wouldn’t fare well in any work environment today. And again, Doc is correct, this is exactly what is and will breed the type of environment that will eventually unionize Wal-Mart employees… Read more »
Bernadette Budnic
Guest
Bernadette Budnic
15 years 2 months ago

Hmmmm. I’m having a hard time comprehending all of these responses. What do people expect from employees at lower levels? Is it not humane to be able to expect to get something to eat and get a chance to go to the bathroom during an 8-hour day? This is pretty basic here. And how could skipping those basic human needs possibly develop promotable employees when you present them with denying them basic needs? Who would want to work for a company like that?

Yes, retail comes in “waves,” but it doesn’t sound like we’re discussing “postponing” breaks/lunches until there’s an opportunity to go for a break/meal; this sounds like not getting any breaks/meals at all.

Robert Craycraft
Guest
Robert Craycraft
15 years 2 months ago

I feel David’s and Carol’s comments are unfair and inhumane. First, this issue is not about “smoke breaks,” it is about a 30-minute unpaid lunch break after six hours work. Does that need sound like someone who isn’t a “team player,” for goodness’ sake? And the “job security” comment seems code language for “we will reward you by not firing you.” Gee, thanks. My retailing background is primarily department store, and I watched my employers (ADG, Mayco) drive away the best and brightest to more life-balanced employers and industries.

There are two types of people in the world. Those who go through bad treatment and say “That was terrible, everyone should have to go through what I went through,” versus “That was terrible, no one should have to go through what I went through.”

Franklin Benson
Guest
Franklin Benson
15 years 2 months ago

116,000 people is NOT a “few crybabies”. There was a pattern. Wal-Mart does not deny it, and they are implementing some steps that should help prevent a repeat.

The purchasing power of minimum wage today is about the lowest it’s ever been, except for in 1996 which was just before it was raised the last time. These people talking about how tough they had it compared to those in the modern day should perhaps walk a mile in the shoes of today’s retail clerk. At $5.15 an hour, you start to really need any little break you can catch, and not getting a break after 6 hours straight is definitely a break you need to catch…

Chuck Chadwick
Guest
Chuck Chadwick
15 years 2 months ago

The issue of being asked to work lunches and breaks in a retail setting is a symptom of a much larger problem. After 30 years of retail management, the pressure to produce results and an inadequate salary budget comes to mind as why these conditions are perhaps not dictated but certainly “allowed” unless it sees the light of day. Then the policy is taken out, and the store management is reprimanded for the violation. The pressure to do more with less is a powerful force that will tend to have negative results if it is done without integrity.

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