Walmart Must Be Accountable

Walmart Must Be Accountable

March 1, 2011
By John R. Durso, President, Local 338 RWDSU/UFCW

For years, Walmart has been a notorious violator of the country’s labor laws. Over the past decade, the company has faced dozens of lawsuits in nearly every state for wage and hour abuses, including not allowing employees to take breaks, requiring them to work through lunch, or forcing them to work off the clock, without pay.

Other lawsuits have dealt with child labor law violations, where minors worked too late at night, during school hours, or worked too many hours in a day. Such allegations are not limited to the United States. In Mexico, thousands of minors between the ages of 14 and 16 “volunteer” as baggers in the company’s stores. They do not receive a paycheck or benefits from Walmart instead, they rely solely on gratuities.

Walmart has also faced lawsuits for violations of health and safety laws in cases where employees have been locked into stores overnight with no means of leaving in case of fire or emergency. In 2003, Michael Rodriguez, an employee at a Sam’s Club location in Texas, had his ankle crushed by heavy machinery. It took over an hour before a manager could be reached in order to unlock the store so Mr. Rodriguez could be taken to a hospital to receive the necessary medical care. This was hardly an isolated incident as examples of this unsafe policy have been documented in Pennsylvania, Florida, Indiana and Colorado.

In 2005, a secret internal memo to Walmart’s Board of Directors was published by The New York Times. The memo outlined proposals designed to make long-term employment with the company unattractive and create a workforce that would be younger, healthier, and cheaper. To accomplish this, Walmart has changed several employment policies. Since then the company has implemented wage caps on hourly jobs, increased the percentage of part-time employees, and required employees to be available around the clock as their shifts would be determined by a computer system located at the corporate offices. Additionally the company has sought ways of decreasing the costs associated with Associates’ health benefits, including changing job descriptions to require more physical activity in order to attract healthier workers, adding a surcharge to employees who have health coverage for their spouse and moving the workforce from traditional health insurance to Health Savings Accounts, which are funded by the employees.

The memo, which was drafted by Susan Chambers, the company’s Executive Vice President of the Global People Division, also outlined the distressing statistics in regards to the health of their “Associates.” Chambers wrote:

“We also have a significant number of Associates and their children who receive health insurance through public-assistance programs. Five percent of our Associates are on Medicaid compared to an average for national employers of 4 percent. Twenty-seven percent of Associates’ children are on such programs,compared to a national average of 22 percent. In total, 46 percent of Associates’ children are either on Medicaid or are

Since the memo was made public, Walmart has hired an impressive public relations team to highlight their new policy of corporate social responsibility. They have flooded the media with advertisements about charitable contributions and opportunities for advancement within the company. However, it is merely a façade to deflect attention from Walmart’s continued violations of employees’ basic rights. Late last year Walmart announced that they intend to
stop paying the $1 Sunday premium for all new employees hired after January 1, 2011, citing premium pay as its “single biggest expense.”

The company will also be before the U.S. Supreme Court this year, facing a class action suitthat claims women faced gender discrimination in pay and promotions. This suit covers between 500,000 to 1.5 million women who have worked for the company since December 1996. As a result, the National Organization of Women has referred to Walmart as a “Merchant of Shame.”

Walmart has traditionally been committed to an anti-union policy, issuing the guide “A Manager’s ToolBox to Remaining Union Free” and showing Associates union busting videos. The company continues to be forthright in this stance, issuing the following statement on their website:

“It’s all about taking care of our people. If we do that and do what is right for our communities, we will be fine. We will continue to foster an environment of open communications and encourage our associates to express their ideas, comments and concerns. We are not against unions. They may be right for some companies but there issimply no need for a third party to come between our associates and their managers.”

And while actions typically speak louder than words, their actions make it clear that Walmart puts its profits before the wellbeing and wishes of its associates. In April 2005, Walmart shut down its store in Joquiere, Quebec after it become the first Wal-Mart location in North America to receive union certification.

The healthcare situation for Walmart employees has not improved much. Almost half of Walmart’s associates, a total of approximately 644,000 workers were not insured through the company in 2010. 182,000 of that total were left completely uninsured while another 43,000 relied on Medicaid and other state run programs. Walmart’s dependence on State programs to subsidize those associates who are not eligible for or cannot afford their insurance, costs the
public millions each year. In Ohio, a report by the State Department of Job and Family Services revealed that 15,000 Walmart employees and their dependents were on Medicaid or received food stamps, a statistic that cost taxpayers $68 million dollars in 2008 alone.

Walmart ranks number one on this year’s list of Fortune 500 companies. In 2010 the company’s revenues were over $408 billion. They made a profit of over $14 billion, a surge of 7% from the previous year. The company claims that $80 billion of that revenue goes towards labor costs, a number they have spent the last six years attempting to lower.

Walmart has one of the country’s highest employee turnover rates, a fact the company acknowledged in their 2010 filing with the U.S. Security and Exchange Commission. Yet, they spend millions on media campaigns glorifying their labor practices, millions that instead could be reinvested into their workforce through raises, more hours for their employees, and/or making health insurance more affordable and accessible.

It is time we hold Walmart accountable to the people who comprise their workforce and contribute to their overwhelming success. Until then, we cannot allow them into New York City to take advantage of and silence the voices of hardworking men and women.

John R. Durso is the President of Local 338, RWDSU/UFCW and President of Long Island Federation of Labor, AFL-CIO

February 28, 2011

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