Wal-Mart Settles Labor Suits for Up to $640 Million
Bentonville, Ark. Wal-Mart Stores said late Tuesday that it has agreed to pay workers up to $640 million to settle 63 labor lawsuits. The settlement will end years of ongoing dispute.
According to Wal-Mart, the actual amount it pays will depend on how many claims are submitted by eligible workers and could range from $352 million to as high as $640 million.
Each settlement still must be approved by a trial court.
Wal-Mart faced 76 similar class action wage-and-hour lawsuits in courts across the country as of March 31, the company said in its most recent 10-K filing with the Securities and Exchange Commission.
However, the company added that many of the settled lawsuits were filed years ago and said the allegations are not representative of the company’s policies.
“Our policy is to pay associates for every hour worked and to provide rest and meal breaks,” Tom Mars, Wal-Mart’s executive VP and general counsel, said in a statement.
Earlier this month, Wal-Mart said it would pay up to $54.25 million to settle a class-action lawsuit alleging it cut workers’ break time and didn’t prevent employees from working off the clock in Minnesota.
Last year, Wal-Mart said it would pay more than $33 million in back wages to thousands of employees after turning itself in to the Labor Department for paying too little in overtime over the previous five years.
Also last year, a judge in Pennsylvania ruled that Wal-Mart workers in that state who previously won a $78.5 million class-action award for working off the clock will share an additional $62.3 million in damages.
Under the announced agreement, Wal-Mart will continue to use various electronic systems and other measures to ensure its compliance with wage-and-hour policies and law.
Wal-Mart, one of the few retailers doing well in a dismal holiday season, said it would take an after-tax charge to continuing operations of about $250 million in its fiscal fourth quarter.