Discount store Family Dollar may be inexpensive, but apparently it is also cheap when it comes to wages. Last week, the store agreed to settle a lawsuit with 1,700 store managers in New York who were denied overtime pay. The settlement could cost Family Dollar up to $14 million – which is less than half the amount of the last lawsuit filed against them in 2009, when they had to pay $33 million to employees who did not receive overtime pay in Alabama. According to the most recent quarterly securities filing, the store is litigating 17 lawsuits in seven states over this same issue.
Employees in the New York case were improperly classified as “managers,” exempting them from overtime pay. But the company gave them non-managerial duties such as stocking shelves and unloading trucks – which resulted in more than 60 hours a week, six days a week of work. Even if the settlement amounts to $14 million, that would mean approximately $8,000 per employee, which may not make them whole.
What needs to happen is that pressure needs to be applied to stores like Family Dollar who work their employees tirelessly without compensation. Retailers such as Wal-Mart, Publix, and Rite Aid have also faced similar complaints, showing that Family Dollar’s seemingly unfair labor practices aren’t just an isolated case in the Big Box Store arena.