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Wal-Mart Loses Pennsylvania Lawsuit Over Workers' Missed Breaks

Wal-Mart Loses Pennsylvania Lawsuit Over Workers' Missed Breaks

By Sophia Pearson

Oct. 12 (Bloomberg) -- Wal-Mart Stores Inc. lost a Pennsylvania lawsuit that accused the world's largest retailer of violating state labor laws by forcing employees to work through rest breaks and off-the-clock.

A state court jury in Philadelphia today sided with two former Wal-Mart workers who sued the company on behalf of almost 187,000 current and former hourly employees in Pennsylvania. Jurors will next consider awarding damages that the employees' lawyers had said might reach $162 million.

Lawyers for the ex-employees, Dolores Hummel and Michelle Braun, claimed that Wal-Mart made workers skip more than 33 million rest breaks from 1998 to 2001 to boost productivity and curb labor costs. More than 70 similar wage suits have been filed in the U.S. against the Bentonville, Arkansas-based company.

During the six-week trial, former Wal-Mart employees testified that they were pressured by store managers to pass on breaks and cut meals short. Two cashiers claimed they were locked in stores after their shifts ended and forced to restock merchandise before they could leave.

The employees' lawyers blamed the missed breaks in part on Wal-Mart's staffing system, which based a store's staffing on its budgeted sales. The system led to personnel shortages at stores that made it impossible for workers to take breaks, the plaintiffs claimed.

Wal-Mart's Denial

Wal-Mart denied the claims, with executives testifying that the company required workers to take scheduled breaks and didn't ignore employees' complaints. Company officials said records showed that workers were shortchanged because some chose not to take breaks or neglected to sign out.

Under Wal-Mart's policy, 30-minute meal periods are unpaid. An employee is entitled to a meal after six hours of work. Rest breaks are paid, with employees who work more than six hours allowed two 15-minute periods.

The company now faces as much as $97.2 million in compensatory damages and $65 million in liquidated damages, said Michael Donovan, an attorney for Hummel and Braun. Wal-Mart reported net income of $11.2 billion for the fiscal year through January, on sales of $312.4 billion.

An Oregon jury found in 2002 that Wal-Mart violated state and federal wage laws by forcing employees to work unpaid overtime. A judge ordered the company to pay $180,000 to about 80 workers. In August, a California judge ordered Wal-Mart to obey that state's laws requiring rest breaks for hourly workers.

The cases are Braun v. Wal-Mart Stores Inc., 3127, and Hummel v. Wal-Mart, 3757, Common Pleas Court, Philadelphia County, Pennsylvania (Philadelphia).