A Fresno law firm scored a major win Wednesday against Wal-Mart with a multimillion-dollar verdict against the retail giant in a federal class-action lawsuit that affects hundreds of truckers in California.
A jury ruled in U.S. District Court in San Francisco that Wal-Mart Stores Inc. violated California’s minimum wage law when it failed to pay its drivers for all the tasks they do. Right before noon, the jury awarded the drivers $54 million in damages
Those unpaid tasks include waiting in line to load or unload their cargo, time spent to fill out federally mandated trip slips, and washing and fueling their trucks.
IN 2015, U.S. DISTRICT COURT JUDGE SUSAN ILLSTON RULED WAL-MART VIOLATED CALIFORNIA’S MINIMUM WAGE LAW, LEAVING ONLY DAMAGES AS THE MAJOR ISSUE TO BE DECIDED.
Under California law, the drivers must be paid for all the time that they were subject to Wal-Mart’s control, said Fresno attorney Nicholas “Butch” Wagner, whose firm of Wagner Jones Kopfman & Artenian represented nearly 840 past and present Wal-Mart drivers, including about 200 from the Valley.
Wagner said additional damages and penalties could push the total that Wal-Mart owes to $150 million.
Wal-Mart has three distribution centers in California located in Porterville, Apple Valley and Red Bluff.
Wal-Mart spokesman Randy Hargrove said company officials “do not believe the facts support the decision.” He said the company plans to file post-trial motions and likely will appeal.
“Our drivers are among the highest paid in the industry, earning from approximately $80,000 to over $100,000 per year,” Hargrove said, noting that 90 percent of Wal-Mart drivers have been with the company more than 10 years. “We strongly believe that our truck drivers are paid in compliance with California law and often in excess of what California law requires.”
The civil dispute began in 2008 when the Fresno law firm accused Wal-Mart of wage theft. Wal-Mart then picked the U.S. District Court in the Northern District of California in San Francisco to settle the civil dispute.
In 2015, U.S. District Court Judge Susan Illston ruled Wal-Mart violated California’s minimum wage law, leaving damages as the major issue to be decided.
Wagner has contended that Wal-Mart shortchanges its drivers by paying them by the mile.
Unlike other states where paying by the mile is permissible, California law says truck drivers are supposed to be paid for all the tasks they do, Wagner said.
But Wal-Mart’s lawyers contended in court filings that Wagner’s interpretation of the law is wrong.
WAL-MART HAS THREE DISTRIBUTION CENTERS IN CALIFORNIA LOCATED IN PORTERVILLE, APPLE VALLEY AND RED BLUFF.
The central issue is no different than that of a housekeeper who is paid not by the hour but for each house cleaned, the Wal-Mart lawyers contend.
To clean a house, the housekeeper must sweep the floors, vacuum the rugs, scrub the bathrooms, mop the tiles, wait for them to dry, wipe down the countertops and so forth.
“Nothing in the Labor Code requires a separate ‘pay code’ for each act that goes into cleaning the house,” Wal-Mart’s lawyers say in court papers.
If Wagner’s interpretation of the law is correct, the lawyers said in court filings that it would lead to absurd results that the California Legislature never could have intended: It would require a separate pay code for wringing a mop, carrying a bucket of cleaning supplies and for each sweep of the broom.
“Does the Labor Code require drivers to be separately paid for putting a key in the ignition or while sitting at a stop light?” the lawyers said. Must Wal-Mart use a separate pay code for a pre-trip inspection and other duties of a trucker?
“Plaintiffs provide no principled explanation – nor any legal authority – as to why a separate pay code must be assigned to each and every act comprising the various activities that employees are already paid to perform.”
But Wagner said the unpaid tasks add up to wage theft. His firm accused Wal-Mart of violating a number of California labor laws, including failing to give its drivers meal and rest breaks.
One big point of contention is whether drivers are adequately compensated for sleeping in their cabs during layovers.
In court documents, Wal-Mart says it pays its drivers $42 to remain in the cab during the required 10-hour layover period. Wagner says Wal-Mart is being disingenuous.
“Forty-two dollars for 10 hours isn’t even minimum wage,” Wagner said, contending that Wal-Mart offers this bonus so truckers will live in their truck and act as security guards so no one breaks into it.
After the verdict, Wagner said he was proud of his firm that has seven lawyers. Wal-Mart was defended by legal giants Gibson, Dunn & Crutcher and Scopelitis, Garvin, Light, Hanson & Feary. The two legal firms have more than 1,700 lawyers.
The trial started on Halloween and took nearly four weeks to complete. Jurors deliberated about nine hours over three days before reaching their verdict, Wagner said. Of the $54 million in damages, a vast majority of it was for Wal-Mart not paying its drivers during the required layover period, he said.
“Hopefully this verdict sends a message to other trucking firms who are committing wage theft,” Wagner said, noting that his firm has civil trials pending against three large trucking firms.