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Walmart Class Action over Labor Practices Settles For $40 Million

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By Minara El-Rahman on December 07, 2009 8:50 AM

Bloomberg reports that a Walmart class action lawsuit brought has settled for $40 million for hourly workers of the big box chain who claim that Walmart's upper management forced them to work off the clock, cut their breaks short, or did not grant them breaks at all.

The lawsuit, which took place in a trial court in Woburn, MA (made famous by the book/movie A Civil Action) is one of 60 wage/hour lawsuits against the retailing giant.

The Lawsuit's Claims

The lawsuit claims that hourly workers in MA Walmart stores and Sam's Club stores were forced by their managers to work off the clock. They were also denied breaks at work or their breaks were shortened.

In Massachusetts, there are state laws that protect meal breaks at work for certain employees. Walmart was alleged to have violated these laws. Back in September, Walmart agreed to pay $3 million dollars after an investigation by the attorney general showed that workers were required by Walmart to work through their meal breaks.

These claims are part of a larger group of lawsuits filed against Walmart for wage and hour in class action lawsuits.

Walmart has had to fork over money in settlements and verdicts in states such as Pennsylvania, California, Nevada and Minnesota.

Lawsuit Settlement Terms

Walmart originally offered $40 million dollars as a settlement, but the original plaintiffs in the class action objected that the terms of the original settlement offer left a bulk of the money to lawyers.

They wanted the settlement amount to be restructured in order to ensure that the actual hourly workers were awarded the money. Bloomberg quotes the plaintiffs' attorney as saying, "This settlement obligates Wal-Mart to pay a full $40 million, with no amounts reverting back to them in the event of unclaimed funds or otherwise."

The Walmart class action settlement agreement also requires that Walmart put a system of ensuring compliance with meal break laws. Walmart has agreed to use a "clock in/clock out" system that prevents workers from using company equipment if they are not clocked in for work. They have also agreed to institute a hotline for workers to call in order to report missed breaks or off the clock work.

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