Walmart to Face Trial Re Subcontractor Utilization

January 20, 2014
By Stephanie West

Los Angeles, California – A federal court in Los Angeles ruled Tuesday, January 12th that Walmart and its warehouse operator must face trial to determine whether they are liable as “joint employers” for violating the workplace rights of hundreds of workers who load and unload Walmart’s goods at three Southern California warehouses.  

The significant ruling subjects Walmart and Schneider Logistics to liability for all unlawful working conditions in their subcontracted facilities.

“Walmart and other major retailers use complicated networks of subcontractors to try to insulate themselves from liability for workplace violations,” said Guadalupe Palma, director of Warehouse Workers United. “The federal court has rejected Walmart’s efforts to pin the blame on its contractors and subcontractors while pretending it had no idea the law was being broken.”

Walmart and Schneider disputed liability on the ground they were not “employers” of the warehouse workers.  They argued that their contracts with two temporary staffing agencies, also defendants in the case, made those agencies solely responsible for illegal working conditions in the warehouse.

This is the first time any court has ruled that a group of workers has presented enough evidence of Walmart’s “joint employer” status to overcome summary judgment or a motion to dismiss, forcing Walmart to defend itself at trial.  If Walmart is found to be a “joint employer,” it will be liable for all of the labor violations the workers have proved.

January 19, 2014

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