Thursday, May 3, 2012

WIN: Wal-Mart will pay nearly $5 million in owed back wages

Another day and another investigation into the practices of the World’s Largest Retailer. Jesse Russell reports:

On the heels of allegations that Wal-Mart may have sought to cover up bribery in Mexico, the world’s largest retailer is now being required to pay nearly $5 million in back wages and damages.

The U.S. Department of Labor announced yesterday that an investigation revealed that Wal-Mart had denied more than 4,000 employees overtime.

The Labor Department alleges that Wal-Mart had misclassified asset protection coordinators and managers

In their vision center as salaried employees exempt from overtime paid as guaranteed by the Fair Labor Standards Act.

The allegations go back to 2007 and Wal-Mart said it took corrective action at that time. The company was also hit with a civil penalty of more than $450,000 due to the repetitive nature of the violations.

This is a common problem in small business but less common in large corporations. To increase productivity and avoid hiring new workers, corporations will authorize overtime for existing workers.

Eventually the corporation will become concerned about overtime costs and they will say no further overtime is authorized. Management will assume that productivity will be maintained , but it will take a drop.

In the last stages of this corporate pee-pee dance, one of the wise guy executives will suggest reclassifying hourly workers as mangers so overtime doesn't have to be paid. 

Bad idea!

Under wage and hour laws, a a manager supervises other people and runs a unit in the enterprise. 

However, there are exempt jobs from this labor rule law like teachers. Managers who make less than $455  a week or less are also eligible for overtime. There are a lot of  other "ifs, ands or buts" under the Fair Labor Standards Act: see

source: Workers Independent News

graphic: Garrett Law
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