|Frequently Asked Questions regarding regarding Wal-Mart's impact on Workers
Q: Will Wal-Mart create more jobs in the Midway?
A: In the short-term: yes; in the long-run: no. Retail sales in a given geographic area are a relatively fixed "pie." At any given time, one thousand people can only wear one thousand pairs of underwear. Likewise, they can only eat so much bread and use so many Q-tips. Without an increase in either population or household income, the retail sales that Wal-Mart gains will be sales that another retailer loses. Accordingly, jobs that Wal-Mart creates will jobs an existing retailer loses.
According to a Wharton School of Business study, many cities have shown that "in exchange for 1 new part-time job in a mega-discount chain, about 1 1/2 full time jobs were eliminated in smaller stores."(1) Other estimates are even more dismal. Dartmouth College professor Donella Meadows explains that, "a Massachusetts study says a typical Wal-Mart adds 140 jobs and destroys 230 higher paying jobs."(2)
Q: Will Wal-Mart create quality jobs?
A: No, Wal-Mart.s wages and benefits are substandard.
- Cost of living . The Cost of Living for a family of four in Twin Cities metro area is $33,528 per year or $16.12/hr.(3)
- Living Wage . The Living Wage as defined by the Saint Paul-Minneapolis Living Wage Policy is 110% of the federal poverty level for a family of four, or, in other words, $9.73/hr.(4)
- Wal-Mart Wage . Wal-Mart employees on average make $7.50/hr.(5) In 2001, their average yearly income was $13,861. That year the federal poverty line for a family of four was $17,650.(6)
OVERTIME PAY Wal-Mart has systematically asked thousands of employees to work off-the- clock or simply deleted employees' hours from time cards. "There are currently 37 separate off-the-clock cases seeking class-action status in 29 states..." including, most recently a case filed in Minnesota's Dakota County District Court.(7)
FULL-TIME HOURS Wal-Mart offers few truly full-time jobs. As Dollars and Sense magazine explains, "genuine full-time work (40 hours a week) is hard to get at Wal-Mart, because the company defines "full-time" as 28 hours a week. This odd definition allows the company to increase staffing as needed, without exceeding the limit of 40 hours a week (thereby avoiding the time-and-a-half pay mandated by federal law)."(8)
HEALTH INSURANCE Both the availability and quality of Wal-Mart's healthcare benefits are sub-standard.
Availability: Most Wal-Mart employees do not have employer-sponsored insurance through Wal-Mart. Likewise, they are expected to pay a larger percentage of that coverage out of their own pocket. Wal-Mart.s health benefits pale in comparison to their competitor's:
|Availability of Health Insurance: Wal-Mart vs. Industry Standards
|Health Insurance Provider
||% of Covered Employees
||% Employer Pays
|Unionized Retail Grocers
|All U.S. Companies:
|Retail Industry at Large:
- Quality: The quality of Wal-Mart.s benefits is sub-standard. The Wall Street Journal reports that "Wal-Mart makes new hourly workers wait six months to sign up for its benefits plan and doesn't cover retirees at all. Its deductibles range as high as $1,000, triple the norm. It refuses to pay for flu shots, eye exams, child vaccinations, chiropractic services and numerous other treatments allowed by many other companies. In many cases, it won't pay for treatment of pre-existing conditions in the first year of coverage."(12)
WORKERS' COMPENSATION Wal-Mart has repeatedly proved unwilling to effectively manage its workers. compensation program, turning itself into the most frequently sued company in America. Wal-Mart's treatment of its own injured workers proved so problematic that the Department of Labor and Industries of the State of Washington, "has audited the company, fined it, issued 'directives,' put it on probation, and now is moving to seize control of Wal-Mart's entire injured worker program--a step it has never before taken except when an employer was going bankrupt,"(13) the Seattle Weekly reports.
LIFE INSURANCE Wal-Mart has issued 354,600 "dead peasant" life insurance policies to its low-level employees intending to collect the payout when the employee died. "The arrangement was supposed to provide the company with substantial tax savings, according to a lawsuit Wal-Mart filed against the insurance companies earlier this year in Delaware. Wal-Mart borrowed money from the insurance companies to cover the cost of the premiums and deducted the interest payments on its federal tax returns. The policies themselves also were considered investments, as their value increased over the lifetime of an employee. And, when an employee died, Wal-Mart collected the benefits," the Bangor Daily News reports.
Q: Will Wal-Mart jobs be available to all of Midway.s residents?
A: Maybe. Wal-Mart has often been charged with discriminating against female, disabled, and non-white workers.
- Sexual Discrimination - Wal-Mart is currently being sued for what would be the largest sex discrimination case in the history of the U.S. For example: Women employed by Wal-Mart on average make 5-15% less than men working in the same jobs. 65% of Wal-Mart's hourly workers are female, while only 33% of its managers are. Women employed hourly on average make $.34 less an hour than males working in the same positions.(15)
- Disability Discrimination - The federal Equal Employment Opportunity Commission has repeatedly sanctioned Wal-Mart. Business Week magazine reports that, "since 1994, the EEOC has filed 16 suits against Wal-Mart for disability discrimination. That is the most Americans with Disabilities Act-related EEOC suits of any U.S. company, according to the EEOC."(16) In fact, the Associated Press covered a California legal settlement in which Wal-Mart admitted that "it systematically discriminated against jobseekers with disabilities."(17)
- Immigrant Discrimination . Wal-Mart has been charged with widespread use of underpaid, undocumented workers. On October 22, 2003, over 300 undocumented workers were arrested in Wal-Mart stores in 21 states. This is the second time in 5 years that Wal-Mart has been faced with these charges. As USA Today reports, these workers "did not receive health insurance and were paid below minimum wage, sometimes as little as $2 a day."(18)
- Racial Discrimination . Wal-Mart has been sued for racial discrimination lawsuits in at least 20 states and Puerto Rico. Fortune Magazine has dropped Wal-Mart from its annual list "of the best companies for African-American, Asian and Hispanic employees and suppliers, because the chain submitted erroneous data counting women employees as a minority."(20) Still, Wal-mart is unwilling to publicly disclose its EEO-1 report (a tally of its workforce by race and gender).
|(1)Report on Wal-Mart.s Entrance to the Market in Lake Placid, NY area. Residents for Responsible Grow, Lake Placid, 1994, pp.4. From Edward Shils and George Taylor, Measuring the Economic and Sociological Impact of the Mega-Retail Discount Chains on Small Enterprise in Urban, Suburban, and Rural Communities, Wharton Entrepreneurial Center, U. of Pennsylvania, Feb 7, 1997.
(2)Valley News, June 12, 1993, "Wal-Mart Should Come on Our Terms, Not at Our Expense," Donella Meadows, p. 26.
(3)The Cost of Living in Minnesota, Dr. Herbert Cederberg, Kevin Ristau, Bruce Steuernagel, JOBS NOW Coalition, May 2001, p. 24.
(4)St. Paul City Council . Resolution - 96-1512 - Accepting and adopting the policy recommendations of the Joint Saint Paul-Minneapolis Living Wage Task Force; adopted in January 1997.
(5)Washington Post, August 27, 2003, "In Wal-Mart.s America", Harold Meyerson.
(6)Business Week, October 6, 2003, "Is Wal-Mart Too Powerful?", Anthony Bianco, Wendy Zellner.
(7)St. Paul Pioneer Press, September 11, 2003, "Wal-Mart sued for labor abuses," Julie Forester.
(8)Dollars & Sense, September-October 2000, Issue #231, University of Wisconsin-Madison, "The Wal-Mart Trap", Annete Bernhardt.
(9)Wal-Mart: Basic Facts and Figures, United Food and Commercial Workers Union International, 2003.
(10)Employer Health Benefits: 2003 Annual Survey, Gary Claxton, Jon Gabel, The Kaiser Family Foundation/Health Research and Educational Trust, 9/9/03, p.50. (11)The Wall Street Journal, September 30, 2003, "Wal-Mart Cost-Cutting Finds Big Target in Health Benenfits", Bernard Wysocki Jr., Ann Zimmerman. (12)Ibid.
(13)Seattle Weekly, April 19 - 25, 2001, "Attention Wal-Mart workers: Please do not report injuries", Mark D. Fefer.
(14)Bangor Daily News, December 9, 2002, "Widow v. Wal-Mart", Deborah Turcotte.
(15)Business Week, March 3, 2003, "No Way to Treat a Lady," Wendy Zellner.
(16)Business Week, July 16, 2001, "Is Wal-Mart Hostile to Women?", Michelle Conlin, Wendy Zellner.
(17)Associated Press, December 18, 2001, "Wal-Mart To Admit to Discrimination".
(18)USA Today, October, 23, 2003, "Wal-Mart cleaners arrested in sweep," Lorrie Grant.
(19)MN: Dare v. Wal-Mart, U.S. Dist Ct, Dist of MN, 20:758, 6/13/03. IL: Bright v. Wal-Mart, Jury trial in U.S. Dist Ct, Rockford, IL, 1999. TX: Texas Employer Advisor, Employer Resource Institute, June 2000, "Race Bias: Wal-Mart Worker Awarded $457,475 For Racial Discrimination," p. 6. VA: WDBJ 7 News at Noon, 5/14/03 , "Walmart-Discrimination," Kimberly McBroom. SC: Thomas v. Wal-Mart, U.S. Dist Ct, Dist of SC, Civil Action No.: 4:94-78-22, 1/11/94. AL: Dudley v. Wal-Mart, U.S. Ct of Appeals, 11th Cir., No. 97-6416, 2/9/99. MS: Vasser v. Wal-Mart, U.S. Dist Ct, Dist of MS Western Div., No. 1:97CV380-B-A, 2/24/99. FL: Wideman v. Wal-Mart, U.S. Ct of Appeals, 11th Cir., No. 97-2897, 5/27/98. CT: Sample v. Wal-Mart, U.S. Dist Ct, Dist of CT, No. 3-01CV545, 1/13/03. MA: Danco, Inc and Guiliani v. Wal-Mart, U.S. Ct of Appeals, 1st Cir., No. 98-2101, 5/12/99. NC: The Daily Mississippian, 6/21/00, "Wal-Mart: Corporate Dictators," Blake Aued. GA: The Exchange, 1/16/00, "Elusive Equality", Dave DeWitte.. AK: Stewart v. Wal-Mart, 3rd Judicial Dist (AK) Superior Ct, No. 3AN-95-06964, 2001. Puerto Rico: Rodriguez-Cuervos v. Wal-Mart, 181 F.3d 15 (1st Cir., 1999). KS: Scott v. Wal-Mart, U.S. Ct of Appeals, 10th Cir., No. 01-3180, 10/4/02. CA: The Nation, 12-16-02, "Wal-Mart Values," Lisa Featherstone. OH: Sun News, 7/29/99, "More Join Wal-Mart Lawsuit," Jeff Sikorovsky. WI: Stalter v.Wal-Mart, 7th Cir., No. 98-3453, 9/30/99. KY: Deffenbaugh-Williams v. Wal-Mart, 156 F3d 581 (5th Cir. 1998). CO: Cervantes v. Wal-Mart, U.S. Ct of Appeals, 10th Cir., No. 00-1058, 1/3/01.
(20)Knight-Ridder Tribune Business News, July 10, 1999, "Wal-Mart Dropped off Minority-Friendly List of Companies."