By Walmart’s reckoning, their California truck drivers make at least $80,000 and are fully compensated for their time.

U.S. District Judge Susan Illston in San Francisco sees it otherwise. She found Walmart’s pay policies “violate California wage law by failing to pay drivers at least minimum wage for all the time they work” in a ruling (pdf) that could cost the company more than $100 million.

The lawsuit was initially filed in Alameda County Superior Court in 2008 before Walmart had it moved to federal court, where it achieved class-action status in September 2014 for around 500 drivers employed since 2003.

Walmart pays its drivers by the mile and for specific activities they perform, as described in the company manuals. The company argued that compensation for other stuff―inspections, vehicle washing and cleaning, layovers, rest breaks, paperwork, fueling―is covered by pay for named activities. The other stuff fills in the cracks between compensated activities like “arrive,” “hook,” “live unload” and “live load.”  

The judge disagreed:

“The Court finds that activities that are not separately compensated (and are explicitly listed and recognized as unpaid activities) may not properly be built in or subsumed into the activity pay component of Wal-Mart’s pay policies, under California law.”

One of those explicitly listed activities was layovers. The Walmart manuals require that drivers must not drive within 10 hours of a previous stint. The compensation for that mandatory layover is $42, or $4.20 an hour. That’s considerably less than minimum wage.

Walmart argued that the workers weren’t working during those 10 hours, but the judge cited California code that defined hours worked as “the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so.”

You still get paid when the boss tells you to stop working, but stick around. The judge said Walmart “exercised a high level of control over its drivers” by denying them layover money if they slept at home or outside the truck cab. The drivers said it was Walmart’s way of having a very cheap security guard on site with the truck.

Walmart’s manuals say that drivers don’t get paid while routine scheduled equipment maintenance is performed, during government inspections or when stopped for a highway weigh scale. The judge rejected a company argument that the driver was already compensated with mileage money for the weigh-in because the wheels of the truck are spinning as it moves across the scale.

Walmart is the nation’s largest private-sector employer. A company spokesman told the Fresno Bee that the company intends to appeal.

–Ken Broder

To Learn More:

Fresno Law Firm’s Win Against Wal-Mart Could Cost Retailer $100 Million (by Pablo Lopez, Fresno Bee)

Wal-Mart Stores Inc. Could Owe $100M for Minimum Wage Violations (by Cole Stangler, International Business Times)

Wal-Mart Truck Drivers Granted Class Action Status in California Minimum Wage Lawsuit (The Trucker)

California Lawsuit Alleges Walmart Drivers Were Paid Less Than Minimum Wage (by Greg Grisolano, Land Line)

Charles Ridgeway et al v. Wal-Mart Stores, Inc. (U.S. District Court Northern District of California) (pdf)