Target Agrees to $4.6 Million Settlement Over New Jersey Warehouse Pay

Target has agreed to a $4.6 million settlement in Sadler v. Target Corp., Civil Action No. 1:23-cv-00030-CPO-SAK, resolving New Jersey wage-and-hour claims brought on behalf of hourly, non-exempt progression team members at the company’s New Jersey distribution centers. The agreement, reached January 5, 2026, settles allegations that mandatory pre- and post-shift security screenings and lengthy walks inside warehouses to and from workstations constituted compensable hours that were not properly counted for minimum wage and overtime purposes under New Jersey law.

Target denies liability but agreed to the settlement to avoid the risks and delays of continued litigation. The class covers progression team members who worked at New Jersey distribution centers from August 6, 2019 through the court’s final approval date. Class members are being identified by Target payroll records, and the settlement administrator will use those records to calculate pro rata shares of the net settlement fund.

Workers identified as class members do not need to file a claim form to receive payments; distributions will be automatic unless an individual timely excludes themselves. The settlement administrator’s website and materials provide the mechanism for calculation, frequently asked questions and administrator contact information. Important deadlines include a February 13, 2026 deadline to exclude oneself or to object, and a final fairness hearing scheduled for February 24, 2026. The settlement website is njdistributioncentersettlement.com.

For Target employees and HR teams, the settlement underscores how state law can differ from federal rules in defining compensable time. New Jersey wage rules and administrative guidance in some areas provide broader coverage than the federal Fair Labor Standards Act, so time spent in security screenings or walking long distances within a facility can be treated as hours worked under state law even if similar practices have been handled differently elsewhere.

Employers that operate large distribution centers should review timekeeping and attendance policies to ensure screenings, security procedures and internal walking times are appropriately captured and compensated where required. Human resources, store operations and payroll teams may need to coordinate to identify potential exposures, adjust timekeeping practices, and update training for supervisors and hourly staff to avoid similar claims. The settlement is a reminder that operational practices common in warehouses can have wage-and-hour implications under state law.