Requiring work during breaks: a $78 million mistake — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

Requiring work during breaks: a $78 million mistake

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A Pennsylvania jury last month awarded a group of present and former Wal-Mart employees $78 million in damages because the mega-retailer forced the employees to work without pay.

The class-action lawsuit claimed that Wal-Mart managers pressured employees to cut or skip meal or rest breaks. The jury concluded the employees were forced to work through their breaks and were not paid for that time. The case covered employees who worked at Pennsylvania Wal-Marts and Sam's Clubs from March 1998 through May 2006.

The jury benefited from inside evidence, including videos of Wal-Mart executives bragging about cost-cutting measures. The tapes showed one former exec at a company meeting saying, "You've heard all the clippings and seen TV articles, haven't you, about wage-and-hour violations and so on and so forth? I will tell you that is true." Wal-Mart has also faced big wage-and-hour judgments in California, Colorado and Oregon in the past two years.

The Pennsylvania judge overseeing the case will also decide whether the giant retailer will have to pay even more. Potential penalties under state labor laws could add another $62 million to the tab.

Final tip: This case was tried in a state court, interpreting state labor laws. Following the federal FLSA isn't enough. Often, state laws give employees greater rights than federal law.  

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