Wal-Mart faces Minn. labor law trial

A Minnesota judge's ruling against Wal-Mart Stores Inc. was the world's largest retailer's third straight defeat in a wage-class action trial. A jury could order the company to pay up to $2 billion. (Mel Evans/Associated Press/File 2008)

SOUTHFIELD, Mich. - Wal-Mart Stores Inc. broke Minnesota labor laws, a state judge ruled, handing the world's largest retailer its third straight defeat in a wage-class action trial and the possibility a jury may order it to pay $2 billion.

The company required hourly employees to work off the clock during training and denied full rest or meal breaks in violation of state laws, Minnesota District Judge Robert King Jr. ruled yesterday. He said Wal-Mart broke labor laws more than 2 million times and ordered the company to give employees $6.5 million in back pay.

"Wal-Mart's failure to compensate plaintiffs was willful," the judge wrote. "Wal-Mart was on notice from numerous sources of the wage and hour violations at issue and failed to correct the problem."

The lawsuit is one of more than 70 cases, including class actions, or group suits, in which Wal-Mart has been accused of wage law violations. The retailer lost a $78 million jury verdict in Pennsylvania in 2006 over rest breaks and unpaid work and a $172 million verdict in California in 2005 over meal breaks. Both verdicts have been appealed.

"They are involved in more litigation over alleged violations of wage and hour laws than any other company," said professor Carl Tobias of the University of Richmond School of Law in Virginia. "They might want to reevaluate their policies."

King's decision means Wal-Mart will face a second trial in Minnesota state court, this time before a jury. Minnesota labor law allows a fine of up to $1,000 per violation of wage and hour rules. With 2 million violations, that may total up to $2 billion. At the Oct. 20 trial, jurors will determine how much each violation is worth and consider punitive damages.

Wal-Mart, based in Bentonville, Ark., may appeal, said a spokeswoman.

The lawsuit was filed by four women on behalf of about 56,000 Wal-Mart and Sam's Club employees.