Tuesday, June 14, 2011

The Other Wal-Mart Class Action

Wal-Mart recently witnessed the awesome power of the Pennyslvania Wage Payment and Collection Law (WPCL) first-hand. In Braun v. Wal-Mart, the Superior Court of Pennsylvania largely upheld a $187 million judgment against the retail titan with just some gentle trimming and recalculation around the edges. This class action case arose primarily from Wal-Mart’s alleged failure to properly compensate its employees for break time spent working and missed rest breaks.

The WPCL does not create any obligations itself, rather it is a handy tool for enforcing existing obligations of employers to compensate employees. Here, Wal-Mart policy and the Pennsylvania Minimum Wage Act required the stores to compensate employees for time spent working “off the clock” and for regular paid rest breaks. So, what makes the WPCL a handy tool?

First, it provides for mandatory attorney’s fees and costs if you win. It also contains a liquidated damages provision, allowing for additional collection in certain circumstances. Here, Wal-Mart faced a class action lawsuit from upwards of 187,000 employees, representing all Pennsylvania hourly employees for a given time period. How does this work in action?
  • WPCL verdict: $ 49,568,541.00
  • WPCL penalty: $ 62,253,000.00
  • WPCL attorney fees: $ 33,813,986.24
  • WPCL expenses: $ 2,670,325.52
 Throw in some extras:
  • Common Law verdict: $ 29,178,873.35
  • Statutory Interest: $ 10,163,863.00
 And you get:
  • Total: $187,648,589.11
Behold, the awesome power of the WPCL (as noted previously, there will be some minor changes to those figures). Of course, Wal-Mart has that other class action pending... the Supreme Court opinion in Wal-Mart v. Dukes is expected any day now. I suspect that one will go a little better for them.

Posted by Philip Miles, an attorney with McQuaide Blasko in State College, Pennsylvania in the firm's civil litigation and labor and employment law practice groups.