Wal-Mart vs. Wage and Hour Litigation

Wal-Mart has been under a siege of litigation over its payment practices both under the FLSA and various state laws. One of its relatively few victories, the decertification of a 10 year class in Massachusetts has now been taken away by the Supreme Court of the Commonwealth. Salvas v. Wal-Mart (Mass. 9/23/08).

I know that given all the adverse publicity and some of the evidence of practices by some Wal-Mart managers, they may not be the poster child to call for reform of litigation in these type cases. However, just a reading of this opinion and seeing other courts struggle with how to handle these cases, makes me think that the overall system is in need of a massive restructuring.

One problem is that relatively few cases make it for appellate review, since the cost pressures of fighting them make settlement often an economically viable option. Anytime a system has that principle, it becomes very hard for the court system to separate the good from the merely mercenary cases. The Salvas opinion unfortunately, does nothing to advance the cause but is likely to lead to more litigation, make it more difficult (hence more costly) to defend and the downward spiral continues.

For all employers, not just Wal-Mart this is no longer an idle threat, but is now a major problem.