Wal-Mart Settles in Overtime Lawsuit

According to the U.S. Department of Labor, Wal-Mart Stores Inc. has violated federal overtime laws. Back in 2007, Wal-Mart was charged for not paying overtime to thousands of employees. For the last five years, the Labor Department and Wal-Mart have been debating the amounts owed to the affected employees. Wal-Mart finally settled to pay $4.8 million on May 1st. This amount consists of both back pay and damages.

There were about 4,500 employees who were affected by this case of Wal-Mart’s illegal pay practices. These employees had one of two misclassified job roles: Vision Center Manager (VCM) and Asset Protection Coordinator (APC). Before 2007, Wal-Mart classified these job roles as exempt because they were managerial and salaried positions. This lawsuit has ultimately determined that these job roles are non-exempt. Therefore, Wal-Mart is mandated to apply all federal wage and hour requirements to employees with these newly non-exempt positions. Fortunately, Wal-Mart reclassified these positions and adjusted overtime pay practices when this lawsuit first originated.

Over the years, Wal-Mart has been charged in numerous class action cases involving overtime pay. Consequently, the company has acquired a reputation of denying workers overtime pay and other wage and hour rights. Hopefully, their dark history of violating federal overtime laws will not continue into the future. Essentially, this lawsuit has helped to reassure the American people that the U.S. Department of Labor has been very strict in ensuring that employees are given the wages they deserve.

Obviously, it is crucial to understand the differences between exempt and non-exempt employees. Exempt employees are generally classified as personnel who have decision-making and management responsibilities. Thus, exempt employees usually hold executive, administrative, or professional positions. As a good rule, employees should always be considered non-exempt unless they earn at least two times the current minimum wage and clearly meet the job duties of an exempt position. If an employer has difficulty determining exempt/non-exempt statuses, then it is suggested for them to contact competent labor legal counsel to help in their determination.