Walmart Settles Wage and Hour Class Action Suit for $2.5 Million

Shoppers walk to a Walmart in Vernon Hills, Ill., on March 28, 2023. (Nam Y. Huh/AP Photo)

A settlement between Walmart and approximately 81,000 of its employees was approved on July 15 by U.S. District Judge Susan M. Brnovich in the U.S. District Court for Arizona.

The $2.5 million settlement in a class-action lawsuit against Walmart Inc. resolves allegations that the retail giant failed to pay wages for time spent in COVID-19 screenings and did not keep accurate records of related work time during the pandemic.

The case, which has been pending for more than three years, involves approximately 81,000 employees who worked at 112 Walmart locations across Arizona.

The lawsuit was initiated by plaintiffs Kathy Arrison and Tristan Smith in 2021, representing a class of Walmart employees.

Walmart implemented a COVID-19 screening policy for employees in its Arizona stores from April 10, 2020, to Feb. 28, 2022, requiring associates to undergo a multi-step screening process before starting their shifts, according to court records.

Walmart’s defenses included that employees had no reasonable expectation of additional payment beyond the five minutes added daily for COVID-19 screenings and were instructed to adjust their time if screenings exceeded this, which they alleged the plaintiffs did not do.

Walmart claimed it was unaware of any unpaid time, and the company argued a good faith dispute over wages, asserting its compensation policy covered screening time and any oversight was unintentional.

After extensive litigation and a full day of mediation, the parties reached a settlement agreement in February, according to the approved settlement.

This preliminary agreement required court approval, a process that included issuing direct mail notices to 97.6 percent of the class members. Out of more than 81,000 notices sent, only 48 class members opted out, and there was just one formal objection, the settlement approval notice said.

On July 15, Judge Brnovich held a final fairness hearing to determine if the settlement was fair, reasonable, and adequate, and, following a review, the court granted final approval of the settlement.

Judge Brnovich found that the plaintiffs’ case was strong, noting that it had survived motions to dismiss and for summary judgment, and that the settlement was reached after a contested motion for class certification.

The settlement amount of $2.5 million represents approximately 50 percent of the plaintiffs’ potential post-summary judgment claims, according to the court record.

The sum will be distributed to class members based on the number of weeks they worked during the class period from April 10, 2020, to Feb. 28, 2022. No funds will revert to Walmart, and any unclaimed amounts will be redistributed to the class members.

The court also approved $625,000 in attorneys’ fees and $118,160.55 in litigation expenses for class counsel.

In addition, the named plaintiffs, Ms. Arrison and Mr. Smith, will each receive a $5,000 service award for their efforts in representing the class.

The settlement allows Walmart to resolve the litigation without admitting any wrongdoing or liability, while providing compensation to the affected employees.

A Walmart spokesperson told The Epoch Times the company was looking into the matter and will provide a statement as soon as possible.