Walmart Hit With $172 Million for Denying California Workers Their Lunch Breaks

In 2001, California began requiring employers to give a 30-minute unpaid meal break to any worker on a shift of six hours or more. Walmart, the largest private employer in the country, kept its registers and stockrooms running straight through those breaks. A class of current and former California employees sued in Alameda County Superior Court in Oakland, in a case captioned Savaglio v. Wal-Mart Stores, Inc.

The class covered about 116,000 people who worked hourly jobs at Walmart and Sam's Club stores across California between 2001 and 2005. They were cashiers, stockers, and floor staff, many paid close to minimum wage, who put in long shifts without the break the state guaranteed them.

The lawsuit grew out of a national effort that Colorado attorney Frank Azar helped set in motion. Azar learned that a Walmart in Trinidad, Colorado, had paid its pharmacists as salaried staff while actually compensating them hourly, a violation of the federal Fair Labor Standards Act. He sued, then asked what the company was doing to its lower-paid workers. Working with a network of lawyers, he filed class actions against Walmart in 26 states. California was one of them.

At trial in Oakland, the plaintiffs' team, led by attorney Fred Furth, used Walmart's own payroll and timekeeping records to show the pattern. Co-counsel Jessica Grant told the jury those documents showed Walmart had "systematically denied its workers their meal breaks." The case was the first of roughly 40 similar suits nationwide to reach a jury.

On December 22, 2005, the jury returned $172 million: $57 million in general damages and $115 million in punitive damages. Walmart's lawyer, Neal Manne, said the company disagreed with the findings and pointed to compliance changes it had made since the law took effect.

Walmart appealed. Rather than litigate the appeal to a decision, the company resolved the case through a settlement while it was pending, folding Savaglio into a broader 2008 agreement that ended dozens of wage-and-hour class actions against Walmart around the country. A parallel case from the same campaign, tried in Pennsylvania, produced a $188 million judgment.