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Target to pay $4.7 million settlement for unpaid wages to employees

Jan 2, 2026, 3:24 PM10
(Update: Jan 2, 2026, 3:24 PM)
state of the United States of America

Target to pay $4.7 million settlement for unpaid wages to employees

  • Target Corporation will distribute $4.7 million in settlement payments to approximately 13,700 current and former employees.
  • The class action lawsuit focused on unpaid wages related to mandatory security screenings and walking distances at New Jersey distribution centers.
  • Distribution of settlement checks is expected to begin following the fairness hearing scheduled for February 24, 2026.
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In the United States, a class action lawsuit was filed against Target Corporation in November 2022 by lead plaintiff Krystal Sadler on behalf of hourly, non-exempt workers at its distribution centers in New Jersey. The lawsuit claimed that Target failed to compensate its employees adequately for all time worked, particularly for mandatory security screenings and the considerable walking distances to and from their workstations, which is a violation of New Jersey law. The lawsuit addressed significant concerns that many employees were not receiving fair compensation for these tasks that were considered part of their job responsibilities. After denying any wrongdoing, Target opted to settle to avoid extensive legal battles and litigation costs. The settlement, valued at approximately $4.7 million, is set to benefit around 13,700 current and former employees who worked at the Burlington, Perth Amboy, and Logan Township facilities since August 6, 2019. Payments to eligible employees will be calculated based on Target's payroll records and will be distributed on a pro-rata basis without requiring employees to take action. Those individuals who do not choose to opt out of the settlement by the current deadline of February 13, 2026, will automatically receive their settlement checks once the court grants final approval. Legal proceedings have continued to unfold regarding this matter, with a federal court denying Target's request to delay the case in March 2025. A fairness hearing has been scheduled for February 24, 2026, where details of the settlement will be finalized and distribution of funds is expected to commence. According to the settlement allocation, approximately $2.75 million will go directly toward employee payments, while about $1.53 million will cover attorneys’ fees. An additional $10,000 will be awarded to lead plaintiff Krystal Sadler as part of the settlement. Those receiving payments will be provided with appropriate tax forms indicating which portions of their settlement are considered wages versus non-wage compensation. Additionally, the landscape of legal challenges against Target is evolving, as evidenced by a separate lawsuit filed in New York. The case, initiated in August 2025, involves two plaintiffs, Jeanna Kratzert and Neil Mosher, both associated with the Wilton warehouse, and a former employee from the Amsterdam warehouse who joined the suit later in an amended complaint. This lawsuit also alleges non-compensation for unpaid walking time, estimating that workers could lose between $1,000 to $2,000 annually due to unpaid wages amounting to over $2 million. The New York allegations highlight the technological capacity of Target to monitor employee movement, suggesting it could effectively manage compensating employees for all work-related time, including necessary walking to and from time clocks. The growing number of lawsuits against Target reflects broader concerns about employee welfare and fair labor practices in the retail sector.

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