Valero Embroiled in Wage Suit

Company denies allegations of illegal labor practices; class action seeks $100 million

Greg Lindenberg, Editor, CSP

SAN FRANCISCO -- In a class-action lawsuit filed by Sanford Wittels & Heisler LLP in the U.S. District Court for the Northern District of California in San Francisco, Valero Energy Corp. is being accused ofcheating thousands of its hourly employees out of overtime wages for years. The suitallegesthat Valero underpays employees who work in its nearly 6,000 Corner Stores and other of its retail outlets across the United States.
Valero spokesperson Bill Day told <I>CSP Daily News</I>, "Valero has not yet been served with a copy of the lawsuit, so we cannot comment [image-nocss] directly on it; however, based on what was in the press release issued by the plaintiffs' law firm, Valero generally denies the allegations in the lawsuit."
He stressed, "Valero pays its employees appropriately and in accordance with state and federal laws."

The company "requires its retail employees to work punishingly long overtime hours 'off-the-clock' without pay to keep thousands of Valero Corner Stores open 'round-the-clock' while the company earns massive profits," the suit claims.

"To keep its gas pumps flowing, Valero virtually pumps the lifeblood out of its workers who are expected to be on call 24-7, but are only paid for a fraction of the time they spend working," said Steven L. Wittels of Sanford Wittels & Heisler. "This class action aims to turn off this oil Goliath's unfair pay practices. When it comes to its employees, the only thing Valero has refined is how best to fleece its employees out of their wages."

Brought by three current and former California employees, Dorothy McCarthy, Sarndra McKnight and Janice Clifton, the class and collection action seeks to represent thousands of similarly underpaid Valero employees through the United States.

"Even though the oil company knows full well that its workers are virtually chained to the pumps," said Janette Wipper, an attorney at Sanford Wittels & Heisler, "management has failed to lessen their workload or pay them mandatory overtime compensation as required by law."

According to the complaint, the retailer fails to pay its Corner Store employees for mandatory "off-the-clock" work, "on-call" time or overtime wages for work in excess of 40 hours a week and eight hours a day; fails to provide its workers with mandatory meal periods and rest breaks; and makes unlawful deductions from employees' earned wages.

"Valero's wrongful practices violate federal and state wage and hour laws," said plaintiffs' counsel Jeremy Heisler. "Not only must Valero's unfair labor practices be stopped, but the hourly employees who have been and continue to be exploited by these practices must be promptly and appropriately compensated for all hours worked."

The named plaintiffs seek tens of thousands of dollars from Valero for each worker who was underpaid in violation of the federal Fair Labor Standards Act (FLSA); the California Labor Code; and the California Business and Professions Code. The FLSA claims are brought on behalf of all Valero non-exempt Corner Store workers, including store managers and assistant managers, who worked at any Valero retail store or Valero-operated brand name store in the nation.

"Even though Valero's Corner Sare open around the clock, seven days a week, every day of the year, the company assigns just one store manager to each corner store," said McCarthy. "This makes every manager's work week significantly longer than 40 hours, but we are not paid for these additional hours, and we are not provided time for meals or rest breaks. The company's swept our complaints under the rug for years. This class action is the only hope we have of being paid for the work we actually do and getting the breaks we're entitled to."

Plaintiffs' attorneys, Sanford Wittels & Heisler, estimate the company's liability at $100 million. The class-action suit demands that Valero immediately pay all unpaid wages due the plaintiffs and members of the class plus all damages permitted by California and federal wage and hour laws, as well as stop its unlawful pay practices.San Antonio, Texas-based Valero, with 2008 revenues of $119 billion, owns and operates 16 refineries throughout the United States, Canada and the Caribbean with a combined throughput capacity of approximately three million barrels per day, making it the largest refiner in North America. Valero is also a leading ethanol producer with seven ethanol plants in the Midwest with a combined capacity of 780 million gallons per year, and is one of the nation's largest retail operators with approximately 5,800 retail and branded wholesale outlets in the United States, Canada and the Caribbean under the Valero, Diamond Shamrock, Shamrock, Ultramar and Beacon brands.