Just two years ago, Wal-Mart reportedly shelled out $50 million to settle a dispute with Colorado employees who claimed they were forced to work off-the-clock. Now the retail giant is embroiled in a string of 30 lawsuits across the country brought by employees who charge that managers required them, too, to work unpaid overtime. In the first of these lawsuits to reach trial, a federal jury in Oregon has returned another pro-worker verdict. We’ll explain what happened and suggest steps you can take to avoid similar disputes.
Employees Say They Work Off-the-Clock
Carolyn Thiebes and Betty Alderson, employees at Wal-Mart’s Salem, Ore., store, filed a class-action lawsuit on behalf of more than 400 workers at Wal-Mart’s Oregon stores. They alleged that Wal-Mart managers required employees to work off-the-clock, meaning without pay, in a number of ways. The employees claimed that managers would wait until workers clocked out, and then ask them to clean the store. Managers also allegedly deleted overtime hours from time cards and reprimanded employees who claimed overtime for the after-hours work. Plus, the lawsuit charged, employees felt compelled to work off-the-clock because managers frequently assigned them more work than they could complete in a shift. At trial, Wal-Mart argued that company policy prohibited off-the-clock work. However, the company admitted that some isolated instances had occurred.
The HR Management & Compliance Report: How To Comply with California Wage & Hour Law, explains everything you need to know to stay in compliance with the state’s complex and ever-changing rules, laws, and regulations in this area. Coverage on bonuses, meal and rest breaks, overtime, alternative workweeks, final paychecks, and more.
Jury Sides with Employees
A federal jury sided with the employees, finding the company liable for back overtime. Another jury will now decide how much the company must pay out. Wal-Mart has said it may appeal the verdict.
Sidestepping Similar Problems
The allegations Wal-Mart is facing in its many lawsuits aren’t uncommon. Many companies, including high-profile employers such as Nordstrom, Albertsons grocery chain, and Taco Bell, have been involved in similar lawsuits within the past few years.
To avoid similar problems, it’s important to make sure your wage-and-hour practices are in order. Here are some pointers:
- Have a clear policy. Be sure you have a written policy prohibiting off-the-clock work by nonexempt employees. Your policy should state that nonexempt employees may not work overtime without prior written authorization. If an employee violates the policy, take immediate disciplinary steps. Note, however, that the law says you must pay for any time worked, even if it’s unauthorized or in violation of your policies.
- Train managers. As the Wal-Mart case demonstrates, it’s also critical that your management team understands the policy and how to enforce it. Consider including training on this topic in your orientation for new managers.
- Keep detailed records. Keep complete records of all hours your employees work—including all time they put in on tasks before or after their workday. Not only is recordkeeping required by law, but it will make it easier for you to show your employees were correctly paid if you’re challenged.