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Wal-Mart Announces Wage Caps & 40% Part Time Hires

Discussion in 'Sports and News' started by Deeper_Background, Oct 2, 2006.

  1. Deeper_Background

    Deeper_Background Active Member

    Published: October 2, 2006
    Wal-Mart, the nation’s largest private employer, is pushing to create a cheaper, more flexible work force by capping wages, using more part-time workers and scheduling more workers on nights and weekends.

    Wal-Mart sent the following confidential memo to managers, instructing them how to answer questions from employees about new pay ranges and wage caps. The document was provided to The New York Times by
    a union-funded group that is critical of the retailer.

    WalMart Memo on Wage Caps
    (pdf) Wal-Mart executives say they have embraced new policies for a large number of their 1.3 million workers to better serve their customers, especially at busy shopping times — and point out that competitors like Sears and Target have made some of these moves, too.

    But some Wal-Mart workers say the changes are further reducing their already modest incomes and putting a serious strain on their child-rearing and personal lives. Current and former Wal-Mart workers say some managers have insisted that they make themselves available around the clock, and assert that the company is making changes with an eye to forcing out longtime higher-wage workers to make way for lower-wage part-time employees.

    Investment analysts and store managers say Wal-Mart executives have told them the company wants to transform its work force to 40 percent part-time from 20 percent. Wal-Mart denies it has a goal of 40 percent part-time workers, although company officials say that part-timers now make up 25 percent to 30 percent of workers, up from 20 percent last October.

    To some extent, Wal-Mart is simply doing what business strategists recommend: deploying workers more effectively to meet the peaks and valleys of business in their stores. Wall Street, which has put pressure on Wal-Mart to raise its stock price, has endorsed the strategy, with analysts praising the new approach to managing its workers. In the last three years, the stock price has fallen about 10 percent, closing at $49.32 a share on Friday.

    “They need to be doing some of this,” said Charles Grom, an analyst at J. P. Morgan Chase who covers Wal-Mart. It lets the company schedule employees “when they are generating most of their sales — at lunch, in the evening on the weekends.”

    But Sally Wright, 67, an $11-an-hour greeter at the Wal-Mart in Ponca City, Okla., said she quit in August after 22 years with the company when managers pressed her to make herself available to work any time, day or night. She requested staying on the day shift, but her manager reduced her schedule from 32 hours a week to 8 and refused her pleas for more hours, she said.

    “They were trying to get rid of me,” Ms. Wright said. “I think it was to save on health insurance and on the wages.”

    Wal-Mart vigorously denies it is pushing out longtime or full-time employees and says its moves will ensure its competitiveness. The company says it gives employees three weeks’ notice of their schedules and takes their preferences into account, but that description differs from those of many workers interviewed. Workers said that their preferences were often ignored and that they were often given only a few days’ notice of scheduling changes.

    These moves have been unfolding in the year since Wal-Mart’s top human resources official sent the company’s board a confidential memo stating, with evident concern, that experienced employees were paid considerably more than workers with just one year on the job, while being no more productive. The memo, disclosed by The New York Times in October 2005, also recommended hiring healthier workers and more part-time workers because they were less likely to enroll in Wal-Mart’s health plan.

    Other big retailers, with or without unions, have begun using more part-time workers, adopted wage caps and instituted more demanding work schedules in one form or another. But because Wal-Mart is such a giant — its $312 billion in sales last year exceeded the sales of the next five biggest retailers combined — its new labor practices may well influence policies more broadly.

    And Wal-Mart’s tougher scheduling demands could be especially taxing on workers because, unlike its competitors, the chain has many stores — more than 1,900 out of 4,000 — that are open 24 hours.

    Human resources experts have long said that companies benefit most from having experienced workers. Yet Wal-Mart officials say the efficiencies they gain will outweigh the effects of having what labor experts say would be a less experienced, less stable, lower-paid work force.

    Sarah Clark, a Wal-Mart spokeswoman, said the company viewed the changes as “a productivity improvement through which we will improve the shopping experience for our customers and make Wal-Mart a better place to work for our associates,” as Wal-Mart refers to its employees.
  2. busuncle

    busuncle Member

    I find it so strange that Wal-Mart catches so much flak for doing the same things that other retailers do.

    Wal-Mart has consistently had far more full-time employees than other large retailers. Target basically perfected the art of using a large mass of flexible part-time workers and very few full-timers. (I say this is as a Target "team member" of three years).

    Wal-Mart is finally catching up to the rest of the retail industry.
  3. JR

    JR Well-Known Member

    Because they're Wal-Mart. They're not just "another retailer". But I get your point. It's just that policy decisions by this retailer have an enormous impact on every community they stomp on set up shop in.

    I haven't read the whole PDF document (it's 25 pages) but if 40% of your workforce is part time (as opposed to the present 20%), I suspect that will generate huge savings in benefits. I don't know, I'm just assuming.

    But yeah, despite my feelings about Wal-Mart, rule #1 of staffing for retail is maintaining flexibility. And you can do that a lot easier with part time staff.
  4. Columbo

    Columbo Active Member

    Pride in the job and also the hammer the company has over employees would be severely reduced with so many part-timers, I would surmise.
  5. cranberry

    cranberry Well-Known Member

    I find it strange that companies mistreating their workers aren't held in even greater disdain. But that's just me.
  6. novelist_wannabe

    novelist_wannabe Well-Known Member

    This has been debated ad nauseum on this board, but I'll go ahead and say it anyway: Nobody. Put. A. Gun. To. Their. Head. And. Made. Them. Work. At. Wal-Mart.

    I'm not saying Wal-Mart is perfect, far from it. I wouldn't work there. But if the job skills you have only qualify you to work stocking shelves at Wal-Mart and you don't like working there, get off your ass and get some better job skills and work for someone else. It can and is done all the time.
  7. Yes, and if all you can do is work in a mill for two bucks an hour on a 70-hour week, tough.
    Thus did none of our grandparents ever move up the economic ladder. Jesus, you'd think the development of the middle class in this country was a happy accident.
  8. Gold

    Gold Active Member

    This is news? Wal-Mart has been doing this forever. If they have more full-time workers, it is only because they are open all night and you can't get people to work part-time shifts at night.

    I think the idea of heavy use of part-time workers to avoid paying benefits started with the newspapers about 30 years ago.
  9. GB-Hack

    GB-Hack Active Member

    And people wonder why the divide between the rich and poor in America is increasing every year. More people and families will be pushed under the poverty line because of this.
  10. poindexter

    poindexter Well-Known Member

    It's a different world than it was when our grandparents were young. If you don't bring a skill set to the table that employers value, you are going to be stuck sucking hind tit.
  11. Which is exactly what they told our grandparents, many of whom were sheepfarmers and goat-herders.
  12. poindexter

    poindexter Well-Known Member

    Well, good luck with that, Fenian. I'm sure the story about the goat-herders 70 years ago is just the ticket people need to induce Wal-Mart to pay wages and benefits that support a full middle-class American lifestyle. Me? I'd tell them to find a trade or skill that employers value.
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