California Overtime Lawsuit Settled for $4.7 Million

Mira Loma, CAAn overtime pay laws action against the operator of a warehouse that handled merchandise for Wal-Mart culminated in a settlement worth $4.7 million, the Los Angeles Times (12/11/13) reports. The lawsuit represented more than 500 workers who toiled at a warehouse operated by Schneider Logistics. While the amount each worker might expect to receive from the settlement was not reported, labor leaders close to the issue call it a victory for workers.

According to the report, Schneider Logistics employs 568 workers at its warehouse in Mira Loma. The sprawling facility is contracted by Wal-Mart Stores Inc. to handle merchandise sold in its chain of retail outlets nationwide. The unpaid overtime lawsuit, filed in March 2012, alleged that Schneider shortchanged workers out of overtime pay as well as regular pay.

The lawsuit also alleged that Schneider denied its employees meal breaks and rest periods - breaks that are mandated by the Fair Labor Standards Act. The allegation is that these nutrition breaks and rest periods were denied to the workers for a period of five years.

It should be noted that Wal-Mart was not a defendant in the California overtime law litigation. However, the LA Times reported that a second lawsuit is still pending against Schneider Logistics, with Wal-Mart Stores Inc. listed as a defendant in that action.

“We are pleased that hundreds of workers who move merchandise in Wal-Mart’s largest warehouse complex in the western United States have won back $4.7 million in stolen wages owed to them for years of honest work,” said Guadalupe Palma, director of Warehouse Workers United, in comments published in the LA Times.

“The brave workers who came forward to expose a deep pattern of abuse and fraud in Wal-Mart’s largest contracted facility risked their jobs and their livelihoods, but today they are vindicated.”

It was alleged by plaintiffs that Schneider Logistics routinely altered time cards, in so doing cheating employees out of pay and hours that were actually worked on behalf of the company.

A federal judge is reported to have approved the settlement. It is not known if Schneider Logistics was required to admit to any wrongdoing in agreeing to the settlement. More often than not, defendants agree to settlements worth millions of dollars as a means to avoid a trial or further court action, without being required to legally admit to wrongdoing. What message such an agreement to pay millions of dollars sends, in itself, is subject to interpretation.