Wal-Mart Employees’ Right to $150 Million Judgment for Off-the-Clock Work and Missed Rest Breaks is Upheld

Photo by Steve Snodgrass, available under a Creative Commons Attribution License.

The rights of a group of Wal-Mart and Sam’s Club employees were vindicated in a June 10, 2011 ruling by the Superior Court of Pennsylvania in an employment class action. The appellate court upheld the $150,000,000 judgment in favor of 187,000 Pennsylvania hourly employees and said there was enough evidence to conclude that Wal-Mart had breached its contract with its hourly employees and violated Pennsylvania’s state labor law.  Wal-Mart, which failed to compensate its employees for hours worked off-the-clock work and missed rest breaks, as mandated by its own corporate handbook and policies, violated its contract with its hourly employees and violated Pennsylvania’s labor laws.

Wal-Mart told its employees to stop clocking in and out for their breaks. In fact, there was evidence that Wal-Mart changed this policy specifically to eliminate the type of “smoking gun” evidence that would have shown widespread break violations. So, if employees weren’t clocking in and out for breaks, how were they able to prove they didn’t get their breaks?

The employees relied on Wal-Mart’s records from before the policy change (when employees were still clocking in and out for rest breaks) to derive the number of break violations that occurred after the policy change.

Likewise, there was no readily-available evidence to demonstrate that employees were working off-the-clock. And yet, the employees were still able to persuade the jury and, later the appellate court, that’s exactly what was going on.  Trial evidence showed that some employees were logging on to cash registers earlier and later than they were clocking in and out for their shifts. The employees used those records to estimate the amount of time the rest of the class was working off-the-clock.

Both the trial court and the appellate court flatly rejected Wal-Mart’s argument that the very business records it used for payroll and other business purposes were so unreliable and inaccurate that the employees couldn’t use them as proof of Wal-Mart’s wrongdoing. The Trial Court called Wal-Mart’s position “unusual in the extreme.”

Abbey Spanier was co-lead counsel for the Wal-Mart and Sam’s Club employees.

If you are being deprived of rest or meal breaks or are working off-the-clock, don’t assume there’s no evidence of it. There is more than one way to skin a cat and there is certainly more than one way to prove a violation of the wage and hour laws.