Walmart Pays $65 Million For Lack of Seating for Employees
It was recently reported Walmart settled a nine-year-old case with current and former cashiers in California for $65 million over failing to provide seating. Yep, you read that right... seating. This lawsuit was brought in 2009 based on a regulation in California that requires seating for employees "when the nature of the work reasonably permits." Cashiers working in Walmarts all over California may be eligible to recover some of the settlement amount depending on the amount of time they worked at Walmart from 2009 until now. It is estimated this pool could be nearly 100,000 people.
The lawsuit was filed under California's Private Attorney General Act, which allows employees to sue their employer and recover civil penalties on behalf of themselves, other employees, and the State of California for labor code violations. If approved by the court, eligible Walmart cashiers are entitled to a quarter of the $65 million settlement, while the remaining amount goes to the California Labor and Workforce Development Agency.
During the almost decade long litigation, Walmart argued the nature of the work performed by its cashiers does not reasonably permit the use of a seat, as employees need to be able to move around to greet customers, look inside carts and stock shelves. Walmart also argued seating makes cashiers less efficient; customers prefer cashiers that stand; and providing seating would cause a significant loss of revenue. While Walmart denies any wrongdoing in this matter, it agreed as part of the settlement, and in addition to the monetary settlement amount, to begin a pilot program that would provide stools for its cashiers in California "who express a desire to use them."
While this litigation may seem obscure to most, it is far from uncommon in California. In fact in 2016, California's Supreme Court found in favor of CVS workers who wanted to sit down on the job. Bank of America also paid $15 million to settle a lawsuit with its tellers over seating. Other stores, such as Home Depot, Target, 99 Cents Only Stores and JP Morgan Chase Bank have faced similar suits by employees suing to enforce California's seating regulation.
LESSONS LEARNED FROM WALMART’S COSTLY LITIGATION
Many of you may not be conducting business in California; so why should you care about this settlement? In addition to the fact it is an interesting situation and it is good to be up-to-date on current happenings in the business world, there are definitely beneficial take-a-ways for all businesses. Be diligent and stay up to date on the laws and regulations in your state, even those you deem obscure or irrelevant. You never know when they may become an issue for your business. Make sure to take your employee's requests seriously. Many of these requests may initially seem petty or ridiculous, but a business that does its due diligence up front can likely facilitate a compromise that may save it from costly litigation later on. Furthermore, learn from other business' mistakes and be proactive about how your business would react if presented with a similar problem. Going through these types of exercises is not only good practice for future issues your business may face, it also allows your business to identify possible problem areas before it becomes an employee issue.
If you would like to discuss additional lessons your company can take from this case or proactive ways to be prepared for any upcoming situation, please contact your Thompson Coe attorney at (651) 389-5000 or at myHRgenius@thompsoncoe.com. You can also find additional information and tips for your company and HR professionals at https://myhrgenius.co/.
Thompson Coe’s Tips of the Week are not intended as a solicitation, do not constitute legal advice and do not establish an attorney-client relationship.