Wal-Mart to pay nearly $5 million to resolve FLSA overtime violations; also assessed nearly $500,000 in civil penalties
The DOL has announced that Wal-Mart Stores Inc will pay $4,828,442 in back wages and damages to over 4,500 employees across the country to resolve violations of the FLSA’s overtime provisions. The retail giant, based Bentonville, Arkansas, will also pay $463,815 in civil money penalties.
The award stems from an investigation by the DOL’s Wage and Hour Division which found that Wal-Mart had classified current and former vision center managers and asset protection coordinators at Wal-Mart Discount Stores, Wal-Mart Supercenters, Neighborhood Markets, and Sam’s Club warehouses as exempt employees under the FLSA. That determination resulted in a failure to compensate the employees with overtime pay. However, the DOL’s investigation revealed that the affected employees were all non-exempt under the FLSA and were due overtime pay for any hours worked beyond 40 in a week.
The DOL is clearly sending a signal with the penalty. “Let this be a signal to other companies that when violations are found,” warned Secretary of Labor Hilda L. Solis, “the Labor Department will take appropriate action to ensure that workers receive the wages they have earned.”
Pursuant to the settlement, Wal-Mart will pay all back wages that the DOL has determined, plus an equal amount in liquidated damages to the employees. These civil money penalties are because of the repeat nature of the violations. The company corrected its classification practices in 2007, the DOL noted, and the company and the DOL have been working ever since to reach an agreement.
Wal-Mart had no comment on the announcement.