Company failed to compensate employees for rest breaks, some hours worked
(Reuters) — The Pennsylvania Supreme Court ordered Wal-Mart Stores Inc to pay $188 million to employees who had sued the retailer for failing to compensate them for rest breaks and all hours worked (all figures in US dollars).
Monday's ruling on the class-action lawsuit will reduce Wal-Mart's earnings for the quarter ending on Jan. 31 by six cents a share, the company said in a securities filing. That amounts to roughly four per cent of its profit forecast of $1.46 to $1.56 for the period.
Wal-Mart shares were up 0.5 per cent at $84.39 in midday New York Stock Exchange trading.
The Pennsylvania Supreme Court upheld a 2007 lower court ruling in favor of the workers, who said Wal-Mart failed to pay them for all hours worked and prevented them from taking full meal and rest breaks.
Wal-Mart spokeswoman Brooke Buchanan said the company did not believe the claims should be grouped together in a class-action suit. "Walmart has had strong policies in place to make sure all associates receive their appropriate pay and break periods," she said.
The decision, which affects about 187,000 Wal-Mart employees who worked in Pennsylvania between 1998 and 2006, marks the second unfavorable ruling in a week for the retailer, the largest private employer in the United States.
That ruling was seen as a victory for workers' rights groups who have been challenging the retailer to boost wages and benefits.
A Wal-Mart spokesman said the company did not agree with some of the judge's decisions in that case and was evaluating its next steps.