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Inland warehouse workers sue Walmart distribution center

Warehouse employee Juan Chavez spoke at a news conference Tuesday about a class action labor lawsuit that has been filed against companies doing business in the Inland Empire warehousing industry.
Warehouse employee Juan Chavez spoke at a news conference Tuesday about a class action labor lawsuit that has been filed against companies doing business in the Inland Empire warehousing industry.
Steven Cuevas/KPCC

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A group of Inland Empire warehouse workers are suing a Walmart distribution center and two staffing agencies over alleged workplace and wage violations. Last week, California’s labor commissioner fined one of the companies $500,000 over similar allegations.

The class action lawsuit targets Wisconsin-based Schneider Logistics, which operates a Walmart distribution center in Mira Loma. It also names several staffing agencies that supply workers to Schneider.

Guadalupe Palma, the regional director of Warehouse Workers United, announced the lawsuit Tuesday in downtown Riverside. Warehouse Workers United advocates on behalf of Inland warehouse employees.

“We are here to expose the dirty little secrets taking place inside of these buildings by large corporations like Walmart, Schneider and the staffing agencies that abuse these workers day in and day out,” says Palma. “Unfortunately we know that these types of conditions are not uncommon in the warehouse industry."

Workers complain of being forced to work in overheated trucking containers and unventilated warehouses. They say they’re denied overtime pay and meal breaks. They also complain of being paid according to a confusing fixed flat-rate for a specific job. Actual pay they say is often far less than what’s promised.

“There have been times when we’ve worked up to 16 hours a day and we don’t even earn a minimum wage,” said Juan Chavez, one of the plaintiffs, speaking through a translator. Another issue, he said, is that there is no way to tell how the amount on his pay stub was calculated. "We don’t know how that amount has been arrived at too tally our wages,” he said.

It’s known as “performance pay scale,” an increasingly common practice in the warehousing business as a way of keeping labor costs down. It promises at least minimum wage or better for all workers and above average pay for employees who accomplish tasks quickly. Performance pay scale is touted in a promotional video for Tennessee-based Impact Logistics — one of the firms named in the lawsuit.

“Our trained and qualified associates are paid on a performance pay scale based upon work completed,” says the film’s narrator speaking over jaunty version of Bachman Turner Overdrive’s "Takin’ Care of Business." “The result is highly motivated, fairly compensated, loyal associates working in your operation.”

Still, critics say the “performance pay scale” is prone to abuse. Last week, the California Department of Industrial Relations fined Impact Logistics $499,000 for failing to provide itemized wage statements and other violations; and the state is reviewing payroll records of Impact at least one other staffing firm.

Impact’s chief operating officer Brett Veach says the company is cooperating with the audit. Veach hadn’t yet seen Tuesday’s class action lawsuit and could not comment. In a written statement Schneider Logistics said the company believes it’s in full compliance with California laws and regulations, and expects its vendors to do the same.