Labor Department says retailer must reimburse workers, but no fines issued
WAL-MART IS ONCE again in the news for labor law violations — this time for cheating nearly 87,000 current and former employees nationwide out of overtime pay over a five-year period. In a settlement with the U.S. Department of Labor (DOL) announced January 25, the world’s largest retailer will ante up more than $33 million in restitution.
According to the Associated Press, Wal-Mart approached the DOL’s Fair Labor Standards Division in 2005 requesting a review of its overtime calculations. Those calculations were found to be wrong. The highest overtime reimbursement to an individual Wal-Mart employee under the settlement is nearly $39,000. However, the DOL failed to issue any fines or penalties in the case.
David Nassar, president of Wal-Mart Watch, a public interest group, issued a statement calling the overtime case “just the latest in a disturbing pattern of Wal-Mart’s disregard for the law.” He said the company “only came forward because they were facing greater legal exposure on this matter on several other related lawsuits. The fact that the current administrator of the Labor Department’s Wage and Hour Division, Paul Decamp, has done extensive legal work for Wal-Mart is a stark reminder of why so many organizations opposed DeCamp’s nomination last year.”
The DOL came under intense fire for making a sweetheart deal with Wal-Mart in 2005. In a case involving child labor law violations, DOL fined the multi-billion-dollar company just $135,540 for allowing young teenagers to operate dangerous machinery. In addition to the paltry fine, the DOL agreed to grant Wal-Mart a 15-day written notice before it conducted any investigation or audit in the future — essentially granting the company an opportunity to cover up any violations before investigators arrive.
Wal-Mart is one of the most scrutinized companies in history. It has been repeatedly investigated by federal and state agencies — and sued by its own employees — for workplace infractions. Just last year, a Pennsylvania jury awarded $78.5 million to employees who were forced to work off the clock and through lunch breaks. In 2005, California’s Fair Employment and Housing Commission ordered the company to pay $172 million to more than 100,000 workers for failing to provide rest breaks. In 2003, following an investigation of 61 Wal-Mart stores, the company paid $11 million in fines for hiring illegal immigrants to work off-the clock. The company has also violated family leave laws and gender discrimination laws. It currently faces more than 50 class action lawsuits.
Headquartered in Bentonville, Ark., Wal-Mart operates about 3,400 discount stores in the United States.