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Barbara Farfan

CVS and Rite Aid: Pharmacies Lose More than Money in Lawsuits (CVS, RAD)

By June 29, 2008

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The State of New York announced this week that it is suing national pharmacy chains CVS (CVS) and Rite Aid (RAD). Allegedly the NY outlets of these pharmacies had a bad habit of leaving food, medicine, and baby formula on their shelves well past the products' expiration dates.

Most recent lawsuits and judgments against major retail chains >>

Certainly in every "Retailing 101" book there is a chapter on rotating perishable products. And certainly those basic rotation practices couldn't be more important than they are for the types of products sold in a pharmacy. CVS and Rite Aid employees certainly must have received this news in their new hire training. So how could such a basic operational infraction occur in such consistently large proportions?

It might be the same thing that happened with Southwest Airlines before they grounded 44 planes in March which hadn't received the required inspections and maintenance. It might also be the same thing that happened when physical appraisals were replaced by cursory reviews and computer comparisons in the home mortgage approval process at Washington Mutual.

Cutting corners is just not a good business practice. It's different than cutting back, which is a necessary scaling down in response to business demand. Cutting corners, by contrast, is sacrificing quality by doing something cheaper or quicker. In a panic to keep pace or survive, businesses can't afford to confuse cutting back with cutting corners. The consequences of that confusion could be dire.

Losing flight revenue for 44 planes for a day like Southwest did is bad. Defending yourself against consumer fraud lawsuits like CVS and Rite Aid are now doing is bad. Losing $24 billion, 3,000 employees, and 12 years of stock value like WaMu did is really, really bad.

But, if you add all of those consequences together, it's still not as bad as losing your reputation, the integrity of your brand, and your customers' trust. Just ask Arthur Andersen. In all industries, believe it or not, some things are more valuable than money.

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Comments

March 17, 2010 at 12:34 am
(1) Jerry Ballard USNRet says:

I no longer work at Rite-Aid. I am a Disable veteran and was hired because of my 28 years of Retail management experience and having been a Manager for three other Stores and a Graduate of Navy Retail Operations School.
Rite-Aide discriminated against me on the basis of age and they promoted another employee hired after me, who had no Management or college experience. Where as I had four college degrees.
They exploited me for two years so they could use my skills without having to pay me a fair wage.
Rite-Aide in my view exploits employees and they are crooks! And I will never shop at their stores ever again.

June 29, 2011 at 6:51 pm
(2) Scarlett Savage says:

Jerry, I may need to talk to you. Rite Aid did something to me as well but I’m giving them one last chance to make it right for the good of all. However, their representative keeps reassuring me this will NOT happen. – Scarlett

April 13, 2010 at 10:01 am
(3) Any Anys says:

Okay you have 4 years of college experience and worked with that company, but yet you can’t spell the employers name. I’m not buying your comment it sounds fake. If at any time you felt discriminated again you should have filed with HR. But I think you’re just one of those people just trying to get attention and start lies. Plus Rite-Aid only hires people for SM with management and also give at least 8 weeks of training before even putting them in a store of their own. I’m got to say your comment sounds like a bit of bullsh*t.

September 13, 2011 at 12:32 am
(4) jinminh says:

I bet you couldn’t stay employed at rite aid for 6 months. It takes about that long to figure how misleading they really are. Most of us need a job so we don’t want to rock the boat and management know it and rehearse subtle or maybe even subliminal intinisadtion and threats.

June 2, 2010 at 3:16 pm
(5) Mary says:

Rite Aid in Ohio (Lucas County) DOES leave those items on the shelves past the expiration date. It’s a fact…

Stay on the topic here guys..

PLEASE CHECK THE DATES before you buy from Rite Aid.

August 21, 2010 at 11:24 am
(6) liam says:

any way its not the operators in the stores fault at all its whats happening all over corporate america, build more offices and take away from the front lines where it matters.
take 2 clerks hrs away that cud resolve complaints and build another position in the office so the big guy looks good in court.

September 22, 2010 at 12:35 am
(7) AA says:

I am an SM for CVS, and we take these stories seriously! There’s a zero tolerance policy for outdates in these 3 categories – Baby, Dairy, and children’s remedies. Outdates are a fact of retail, with dwindling staff and higher demands, checking the thousands of items on shelves seems unrealistic. Even with proper rotation, some dated merchandise will be on the shelves. Focusing on the right priorities for dates is the responsibility of the employees. Another thing to note is that many companies list expiration dates on their merchandise that are arbitrary. Yes, the McNeil company may only pay for 1.5 years of a study on Tylenol so they know their product is effective for that long. Some things, like edibles, are very apparent, but there are many different items that have dates on them that consumers don’t even realize; film, vitamins, makeup, skincare, anything with SPF, toothpaste, batteries, and many more. Many of these dates have little to do with the function of the product and more to do with an arbitrary point of data for proper rotation.

October 7, 2010 at 2:15 pm
(8) Joachim Erich Traebecke says:

CVS and Rite Aid: Pharmacies Lose More than Money in Lawsuits, it is true. This is for your information and check this out. CVS was sued by an assistant manager in federal district court in Florida in March 2009 for a claim of failing to pay overtime wages. The assistant manager has alleged a collective action to recover unpaid overtime on behalf of a class of all persons who performed similar work at CVS stores in the three years prior to suit. The case was filed under the federal Fair Labor Standards Act. The assistant manager alleges that he and other class members had to work overtime hours without overtime pay because CVS improperly classified them as being exempt from any overtime pay. The assistant managers are dispute this classification and instead allege they should have been paid for all their overtime hours worked because they were not in fact exempt managers. The assistant manager is represented in this lawsuit by the Shavitz Law Group, which is also representing other, current or former assistant managers around the United States who worked overtime hours without pay. It is anticipated that CVS will dispute the lawsuit. No class has been certified or liability determined by the court at this time. This case is becoming a huge national lawsuit.

November 4, 2010 at 2:36 pm
(9) Beth says:

There are employees who are lazy thinking that because they have a degree they are better than the one who doesn’t. I experience employees who have a degree but doesn’t works better than the one who does not have a degree. Stop complaining and just do your part as an employee and you will do better. On the first place the store got sued because the incompetent complaining employee who are busy complaing instead of doing their job. It is the employee who left the expired milk on the counter needs to be blamed. Employees have so much power and the employers gets all the blame even how many times you train an incompetent employee it will not work.

November 15, 2010 at 9:52 pm
(10) Joachim Erich Traebecke says:

This message is for Beth. Respecting her point of view, it is true that because one individual is more educated than the other one, doesn’t make one better than the other one. A University Education in any Degree doesn’t guarantee success, but it opens many doors in this competitive market (“Knowledge is Power”). I am a well-educated individual with six years of University; speak four languages and 20 years in Management and Customers Service experience. I don’t feel better than another person, but I have great tools to survive in this market. Don’t forget that Companies want to maximize profits with low cost of labor. Every year Companies are controlling the budget with cutting expenses in operations, maintenances and employee hours. Unfortunately, Companies are held accountable for their own actions by the Law. Managers are responsible, to follow up, supervise, delegate, monitor, audit, and analyze. Employees are employees including you and me. When you properly train an employee and take the time to teach that employee the Values, Standards, Ethics, and Policy of the Company, you can make the difference. It is very sad that our most power country of the World, USA, has one of the highest percentages of drop outs from College and Universities (not counting High Schools) and never achieves a Degree. When a Company goes out of Business, or you get terminated or laid off, two things go with you: Your University Degree and your experience; The Company disappear or stays in the market. “I Believe in Education”.

December 26, 2010 at 8:15 pm
(11) Joachim Erich Traebecke says:

Please check this information. CVS Manager Class Action Lawsuit (Wednesday, 25 August 2010 13:24) (LEGAFI) A New York federal judge has certified a nationwide class of current and former assistant store managers of CVS drug stores. The managers are suing the pharmacy giant for failing to properly pay them overtime. CVS is the largest retail pharmacy chain in the U.S. with 6,900 stores, and attorneys estimate tens of thousands of workers could be included in the newly certified class action lawsuit.
The 2009 class action lawsuit alleges CVS avoids paying its assistant store managers overtime by misclassifying them as “executives” who are exempt from receiving overtime pay. “The primary duties of these purported ‘executives,’ however, are non-managerial tasks such as stocking and organizing shelves, unpacking boxes, arranging merchandise, cleaning stores and unloading trucks,” the class action lawsuit says. The assistant store managers have no authority to hire or fire and routinely have to run cash registers. They also routinely work more than 55 hours a week yet receive fixed salaries, according to the lawsuit.
The CVS class action lawsuit is seeking to recover unpaid overtime for assistant store managers for all the hours they worked over 40 each week. It includes all CVS assistant store managers classified as exempt who at any time were employed at CVS within the past three years, excluding those in the states of Florida or California.
A separate class action lawsuit that includes assistant store managers in Florida was also certified earlier this year. The Florida CVS Overtime Class Action Lawsuit also alleges the managers were improperly classified as exempt from overtime pay, and is seeking to recover unpaid wages for all assistant store managers currently or formerly employed in Florida within the past three years.

April 22, 2011 at 11:59 am
(12) JERRY says:

ARE CURRENT AND FORMER STORE MANAGERS INCLUDED IN THIS LAW SUIT? ARE MANAGERS FROM OTHER STATES INCLUDED IN THE LAW SUIT? I WAS A LONG TERM STORE MANAGER FOR CVS AND I CAN TELL YOU THEIR STORES ARE CONSTANTLY UNDER STAFFED. THE WORK LOAD WAS SUCH THAT YOU COULD NOT KEEP UP WITH IT. I WAS WORKING ON MY DAYS OFF, COMING IN EARLY, STAYING LATE, AND LOST VACATION DAYS.

June 19, 2011 at 8:46 pm
(13) Gypsy says:

you have no idea what it is like to work in retail. Assistant managers AND store managers have to use a cash register, unload trucks, stock shelves, clean bathrooms, clean parking lots and any other task the regular employees have to do.
get your head out of your ass.

March 8, 2011 at 10:28 pm
(14) Marie says:

This is the truth, however the fault lies with the corporation. When they are cutting dollars at the store levels and managers are the only other person in the store with one cashier who the hell is supposed to get all the work done. I was a longtime employee of Rite Aid and I can tell you this is what happens. They expect one person who is salaried to stay in the store for as long as it takes to get the job done. Each store is expected to get the same amount of things done but payroll is based on sales. There should be a set amount of payroll for each store to complete the tasks and than add on payroll for cashiers salary. Also, they are wasting money paying for contractors who either aren’t doing the repairs correctly or at all. No one is checking on the people who approve these expenses at corporate. THE MONEY IS MADE IN THE STORES NOT WITH THE PEOPLE WHO ARE MAKING A FORTUNE ABOVE THE STORE MANAGERS….WAKE UP RITE AID…THIS IS WHY UR STRUGGLING!!!

July 23, 2011 at 9:51 am
(15) Diana Wilson says:

check the milk and cigs they are only merchandise that stays down for working class,all other is 3 times what other stores sell them for,New Orleans high for tourist money.

February 7, 2012 at 8:11 am
(16) Tired says:

Marie is dead on.get it done, no matter what.i routinely unload truck outside on the sidewalk, in the dark, no matter the weather. All pig the Merch and drugs out side, doors wide open, by myself. Safety be damned. Once,I called the police and requested they patrol the parking lot due to undesirables hanging around while I did this, no one came. My Dm and loss prevention were notified of this practice, but did nothing. No payroll for help, even for safety reasons. But if you complain, thEU blacklist you,career over

October 23, 2012 at 8:20 pm
(17) Richprz says:

Rite aid HR is a joke! I was sexually harassed and they did nothing! Just moved the other person and just expected that was ok. So as for taking issues to HR.. Good luck. Still debating on Counsel.
This company is headed for a disaster. Their only answer to profitability is to screw the store level staff. Not the pharmacy, nooooo… They “have families”.
We need more than two people in a big store like this and now they tell us cut another 25 hours!!!! This company is insane!
They give us an opportunity to voice our opinion yearly but if you point out negative your store gets in trouble and the whole regional team shows up to force their reasons rite aid is so great down your throat. It’s a yes man company and anyone not in pharmacy or above a DM is nothing more than someone taking up payroll hours… I could go on. If your interested in more or are great sexual harassment council, hit me up. I’ve been a business man most of my life so I’m not just a young idiot posting out of anger. I truly want and can change this company.

January 28, 2014 at 1:32 am
(18) florida pharmacy association fpa says:

Grades in prerequisite coursework are viewed but a minimum GPA isn’t
stipulated. A pharmacy technician is often a professional in charge of fulfilling many
pharmacy-related tasks. Take want to preserve and help with the well-being in the plant community.

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