By Sophia Pearson
Oct. 3 (Bloomberg) -- Wal-Mart Stores Inc., the world's largest retailer, must pay an additional $62.3 million in damages to Pennsylvania workers who were denied rest and meal breaks, bringing the total verdict to $141 million, a judge ruled.
The judge penalized Wal-Mart because it didn't have a ``good faith'' reason for underpaying the workers. The company must pay 124,506 employees who worked at stores between Jan. 1, 2002, and Oct. 13, 2006, Philadelphia Common Pleas Court Judge Mark Bernstein said in opinion issued today.
``This is 100 percent of what we asked for,'' said Mike Donovan, an attorney for the employees. ``Ordinary workers are entitled to the same protection under the law as highly paid executives.''
Wal-Mart faces more than 70 labor-practice lawsuits. The Bentonville, Arkansas-based company lost a $172 million verdict in California in 2005 over meal breaks and is currently defending a suit involving 56,000 hourly workers in Minnesota.
The Philadelphia ruling comes a year after a jury there awarded $78.5 million to Wal-Mart's Pennsylvania workers following a trial over their pay. The October 2006 verdict was Wal-Mart's second multimillion dollar loss in employee group-wage lawsuits.
This year, the company has won class certification decisions barring employees from suing as a group in New York, Illinois and Maryland. It has lost such rulings in New Jersey, South Carolina and Missouri.
Six-Week Trial
``Employees testified that they skipped or cut short their rest breaks by their own choice,'' said Wal-Mart spokeswoman Sharon Weber in an e-mailed statement, adding that the company disagreed with the court's ruling and may appeal. ``An employer should not be penalized when employees do this on their own.''
Former Wal-Mart employees Dolores Hummel and Michele Braun testified during a six-week trial that they were pressured by store managers to skip breaks and cut meals short. Donovan argued that Wal-Mart, the largest private U.S. employer, made Pennsylvania workers skip more than 33 million rest breaks from 1998 to 2001 to boost productivity and cut labor costs.
Under Pennsylvania law, Wal-Mart workers employed after Dec. 31, 2001, can receive $500 beyond actual damages if they were shorted money for 30 days or more. Bernstein didn't address a request by the workers for $10 million in unpaid interest for the period between March 1998 and October 2006.
``The legislature created significant financial incentives for employers to pay workers all the money they've earned by their hard work,'' the judge wrote.
`Good Faith'
The lack of a ``good faith'' reason for refusing to pay the workers subjected the employer to penalty damages under state law, the judge ruled.
He rejected Wal-Mart's defense that employees' hourly earnings weren't considered compensation and that, while employees didn't receive all money earned, they were paid some of what they were owed.
``The wages which were withheld because employees were forced to work `off the clock' are subject to mandatory liquidated damages,'' the judge said in his decision.
Wal-Mart shares rose 26 cents to $45.13 in New York Stock Exchange composite trading.
The Pennsylvania cases are Braun v. Wal-Mart Stores Inc., 3127, and Hummel v. Wal-Mart Stores Inc., 3757, Court of Common Pleas, Philadelphia County, Pennsylvania (Philadelphia).
To contact the reporter on this story: Sophia Pearson in Wilmington, Delaware, Spearson3@bloomberg.net
Last Updated: October 3, 2007 16:44 EDT
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