NEWARK (CN) – In a federal class action, 42 named plaintiffs say Wal-Mart hired them knowing they were undocumented, stiffed them for overtime and for regular wages, paid them in cash or by personal checks from labor contractors, put them to forced labor through coercion, “violated immigration, money laundering and protective wage and hour laws,” and routinely locked them inside stores while they worked night shifts.
Wal-Mart and some of its contractors settled federal complaints and paid millions in fines. The named plaintiffs, suing for the class, seek the wages of which they were cheated, and other damages.
Most of the named plaintiffs have names that indicate Eastern European descent, particularly Polish and Czech. Many say they worked more than 40 hours a week, seven days a week, and never were paid overtime.
Lead plaintiff Victor Manuel Zavala, one of two named plaintiffs with Latino surnames, claims that “beginning in no later than March 1997, senior Wal-Mart management, realizing that Wal-Mart could substantially reduce costs and substantially increase profits were it to rely on the labor of undocumented migrants to clean its thousands of stores, created a criminal enterprise that involved conspiracies to violate, as well as substantive violations, of federal immigration laws and other laws.”
The class claims Wal-Mart engaged in a criminal RICO conspiracy involving “the employment, encouragement, harboring and transporting of undocumented workers,” which the company hired through outside contractors.
Wal-Mart did it to duck taxes, including Social Security, and government regulations and to avoid having to pay for health benefits, according to the complaint.
The class claims Wal-Mart “sheltered the undocumented migrants by arranging or providing lodging for them and routinely transporting them across the United States to work at different Wal-Mart locations.” The plaintiffs say that the company structures its business operations “in multiple shell corporations so as to shield the continued employment of the migrants from detection” and that “senior Wal-Mart executives … knew of the scheme” and “permitted it to flourish.”
The complaint adds: “The Wal-Mart Enterprise was directed by Divisional Vice Presidents within the Wal-Mart Stores Division with responsibility for in-store cleaning and procurement of services.”
The class claims that Wal-Mart typically paid their wages to outside contractors, who then paid the migrant workers in cash or sometimes by personal check.
They also claim Wal-Mart locked them in stores overnight, “intentionally” and “against their will.” Class members who complained about the treatment were “threatened with deportation or other adverse legal action.”
Wal-Mart paid an $11 million fine in 2005 “in order to avoid criminal penalties” after being accused of many illegal immigrants to “provide floor cleaning services” from 1998 to 2003, according to the complaint.
“This action is directed at compensating the named plaintiffs and the class they represent for the harm caused them by this criminal enterprise.”
They seek back wages and treble and punitive damages for RICO violations, conspiracy, violations of the Fair Labor Standards Act and false imprisonment. They are represented by James Linsey with Cohen, Weiss and Simon of New York, N.Y.