Walmart to Pay $102M in California Pay Stub Violation Lawsuit

Walmart has been ordered to pay $102 million for inaccurate California pay stubs.

In early June, U.S. District Judge Lucy Koh determined that the retail giant was in violation of California Labor Code with their wage statements. Although the court determined that the company must pay $102 million, Judge Koh did find that the missed meal break claims brought by the employees were mostly unfounded.

The $102 million includes $48 million in statutory damages awarded under California state law damages and $54 million in penalties awarded under California’s Private Attorneys General Act (PAGA). PAGA allows employees to file lawsuits against their employers and recover penalties on behalf of themselves as well as the State of California.

Plaintiff Roderick M. filed a class action lawsuit against Walmart in January 2017, claiming that the company committed wage violations while he was employed for the company as an hourly employee. If employees missed meal breaks, they were allegedly not compensated as dictated under California law.

California labor law states that: “If an employer fails to provide an employee a meal period in accordance with an applicable IWC Order, the employer must pay one additional hour of pay at the employee’s regular rate of pay for each workday that the meal period is not provided.”

A year after Roderick first filed his class action lawsuit, Judge Koh certified three Classes of Walmart employees as follows:

1. Individuals who were not adequately compensated for missed meal breaks since December 2012;
2. Workers who received pay stubs that failed to break down the rate and/or hours which factored into overtime pay calculations since December 2015; and
3. Employees who ceased working for Walmart since December 2015 but did not receive a final wage statement with pay period dates.

These Classes ranged from 52,000 to around 76,000 estimated employees.

In Judge Koh’s recent decision, she dismissed missed meal break claims brought forth by Roderick due to the fact that he couldn’t prove any missed breaks. This resulted in Judge Koh decertifying the relevant class and dismissing the claims. However, Koh did uphold other claims – including those that resulted in significant PAGA penalties.

Plaintiff counsel is reportedly “very happy with the result” of the verdict due to the win it represent for their clients.

“We are glad that Judge Koh took the time and effort in making her decision and delving into the history and purposes of the labor codes that were at issue,” plaintiff attorneys said in a statement.

In contrast, Walmart maintains that their labor policies do not violate any laws.

“We believe our associate pay stub in California complies with state law and that our associates have been properly paid,” Walmart spokesman Randy Hargrove told Law360. “We take compliance with the law seriously and the only people looking to profit here are the plaintiffs’ attorneys.”

This is not the first time Walmart has been dinged for labor violations as they were recently ordered to pay $6 million in a separate lawsuit for discouraging workers their Chino, California fulfillment facility to not take meal breaks.

The Walmart Pay Stub Class Action Lawsuit is Case No. 5:17-cv-00062 in the U.S. District Court for the Northern District of California.

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