Employee Benefit Reform at Wal-Mart on the Horizon?
Wage and Employee Benefits are Hot Topics at Wal-Mart
As the US Presidential race continued to heat up, several issues were in the spotlight including raising taxes, reducing terrorism, increasing the federal minimum wage, and health care reform as part of a campaign for better compensation for American workers. Vermont Senator Bernie Sanders was notably outspoken on his Twitter account about the way Wal-Mart Stores compensates its employees.
Bernie Sanders turned to Twitter to talk about fair wages and benefits
On Black Friday 2015, Bernie Sanders stated on Twitter:
.@Walmart shouldn’t be allowed to pay workers wages so low that many qualify for Medicaid, food stamps, and government housing. #BlackFriday
— Bernie Sanders (@BernieSanders) November 27, 2015
- The company still fails to provide benefits for the majority of its employees (who are part time and ineligible)
- Although Wal-Mart vows to raise wages for their employees who complete a six-month training program, high turnover prevents them from ever earning more than $9 an hour in may cases
- Around $2.66 billion of taxpayer money goes to Wal-Mart employees annually to pay for government assistance programs, including Medicaid and Food Stamps
- A class-action suit alleged that Wal-Mart engaged in wage theft practices by forcing employees to work through unpaid breaks
Additionally, to his point, Bernie Sanders advised in a press release (in Feb 2015) that although Wal-Mart had promised to raise wages from $9 an hour to $10 an hour by 2016, “Wal-Mart should not be paying starvation wages.”, further, ““While this is a step forward and a response to grassroots activism across the country, this is nowhere near enough. Wal-Mart should raise their minimum wage to at least $10.10 an hour now and move it to $15 over the next several years. Struggling working families should not have to subsidize the wealthiest family in the country.”
Making the case for better employee benefits and pay for millions of Americans
And to Bernie Sanders’ credit, others share his sentiments. The Americans for Tax Fairness organization released a report that stated, “Even after Walmart’s planned wage increases are fully implemented, large taxpayer subsidies will still be required to compensate for Walmart’s low wages.” This report also pointed out that for every Wal-Mart supercenter, the cost to taxpayers for providing public health care averages out to $251,706.
According to an article published on Mother Jones, even if Wal-Mart does start paying it’s associates $10 per hour, many workers are hired as “involuntary part-timers”, and “workers who qualify for the $10 base wage by working at least 34 hours a week, which Walmart considers "full time," would still earn only $17,680 a year—well below the cutoff for many federal assistance programs, especially if a worker has children.”
Change needs to come for all company compensation and benefit programs
Wal-Mart happens to be the most visible companies dealing with criticism over compensation, but there are many other well-known companies that fail to provide what society would consider adequate living wages and health care benefits to employees. The point of all this is that all organizations need to take a look at their policies on compensation, employee benefits, and wage increases – taking into consideration ways that they can improve the lives of their most valuable assets: their people.