Verdict in favor of California employees opens up the retail giant to penalties that could push the total amount owed to more than $150m, lawyers said
Walmart intentionally failed to pay hundreds of truck drivers in California the minimum wage, a federal jury decided Wednesday, awarding the drivers $54m in damages and opening up the retail giant to penalties.
The seven jurors returned the verdict in a lawsuit accusing the company of not properly paying drivers in accordance with California law for activities that included inspecting and washing their trucks and for layovers. Civil penalties will be determined by a judge.
The company argued that the drivers were paid for activities that include those tasks and that they were not working during layovers. A lawyer for Walmart didnt immediately return calls seeking comment on the verdict.
Attorneys for the more than 800 drivers who worked for Walmart between October 2005 and October 2015 were seeking $72m in damages, the bulk of it for layovers. They said during the trial that additional damages and penalties could push the total amount Walmart owed to more than $150m.
Arkansas-based Walmart Stores Inc, the nations largest private employer, has faced other criticism over its pay and treatment of US employees.
The company announced last year that it was giving a raise to about a half-million US workers. The raises were part of a $1bn investment that the retailer said was also intended to give workers more opportunities to advance and more consistent schedules.
Walmart drivers are not paid by the hour. Wages are based on mileage and specified activities.
The drivers attorneys pointed to a ruling in their favor from US district judge Susan Illston, who said last year that Walmart would be in violation of California law if it enforced its driver pay manuals because they say no pay is earned for certain tasks.
Theres nothing in any of those three manuals that covered 10 years of time that show the drivers were paid for any of these tasks that are on your verdict form, attorney Butch Wagner said during closing arguments.
Drivers were also not paid minimum wage for layovers even though Walmart controlled their time by requiring them to stay with their trucks, the plaintiffs attorneys said.
The company argued that it paid drivers for activities that included other, smaller tasks and could not have a separate payment designation for everything they did, some of which took just minutes.
Walmart attorney Scott Edelman likened what the plaintiffs were asking for to a baker who charges a flat fee for a cake, not the individual tasks of buying the eggs, putting the cake in the oven or cleaning the dishes after.
When you pay a baker $20 to bake a cake, what are you paying that baker to do? Walmart attorney Scott Edelman said during his closing argument. Is it just to put the cake in the oven for however long? Because thats essentially what the plaintiffs are arguing.
Walmart pays drivers $42 for 10-hour overnight layovers as an extra benefit, but it does not control their time during that period, Edelman said. Drivers are free to go to the movies, exercise or do other activities, he said.
The company has said its drivers are among the best-paid in the industry, with some making more than $100,000 a year.