. With over 2.2 million employees worldwide, Walmart has faced a torrent of lawsuits and issues with regards to its workforce. These issues involve
low wages,
poor working conditions, inadequate
health care, as well as issues involving the company's strong
anti-union policies. In November 2013, the
National Labor Relations Board (NLRB) announced that it had found that in 13U.S. states Walmart had pressured employees not to engage in strikes on Black Friday, and had illegally disciplined workers who had engaged in strikes. Critics point to Walmart's high
turnover rate as evidence of an unhappy workforce, although other factors may be involved. Approximately 70percent of its employees leave within the first year. Despite this turnover rate, the company is still able to affect unemployment rates. This was found in a study by Oklahoma State University which states, "Walmart is found to have substantially lowered the relative unemployment rates of blacks in those counties where it is present, but to have had only a limited impact on relative incomes after the influences of other socio-economic variables were taken into account."
Wages Walmart reports that in 2006 its workers earned an average of $10.11 per hour.
Human Rights Watch estimates that this is below the average of $10.24 earned by workers at discount department stores, $10.55 at warehouse clubs and supercenters, and $11.12 at grocery stores. Walmart managers are judged, in part, based on their ability to control payroll costs.
The Wall Street Journal says this puts extra pressure on higher-paid workers to be more productive. Walmart insists its wages are generally in line with the current local market in retail labor. Other critics have noted that in 2001, the average wage for a Walmart Sales Clerk was $8.23 per hour, or $13,861 a year, while the federal poverty line for a family of three was $14,630. Walmart founder
Sam Walton once said, "I pay low wages. I can take advantage of that. We're going to be successful, but the basis is a very low-wage, low-benefit model of employment." In August 2006, Walmart announced that it would roll out an average pay increase of 6% for all new hires at 1,200 United States Walmart and Sam's Club locations, but at the same time would institute pay caps on veteran workers. While Walmart maintains that the measures are necessary to stay competitive, critics believe that the salary caps are primarily an effort to push higher-paid veteran workers out of the company. Because Walmart employs part-time and relatively low paid workers, some workers may partially qualify for state welfare programs. This has led critics to claim that Walmart increases the burden on taxpayer-funded services. A 2002 survey by the state of
Georgia's subsidized healthcare system,
PeachCare, found that Walmart was the largest private employer of parents of children enrolled in its program; one quarter of the employees of Georgia Walmarts qualified to enroll their children in the federal subsidized healthcare system
Medicaid. A 2004 study at the
University of California, Berkeley charges that Walmart's low wages and benefits are insufficient, and although decreasing the burden on the social safety net to some extent, California taxpayers still pay $86 million a year to Walmart employees. On September 4, 2008, the
Mexican Supreme Court of Justice ruled that Walmart de Mexico, the Mexican subsidiary of
Walmart, must cease paying its employees in part with vouchers redeemable only at Walmart stores. In July 2016, some workers in
China went on unofficial strike at Walmart stores in
Nanchang,
Jiangxi Province,
Chengdu,
Sichuan Province, and
Harbin,
Heilongjiang Province against the company's new working-hours scheduling system. The striking workers protested the system, which allowed managers to schedule an unlimited number of hours per day totalling up to 174 hours per month without overtime pay. Chinese Walmart staff accused the country's only officially recognised union, the
All-China Federation of Trade Unions (ACFTU), as being apathetic to their cause and unreceptive to workers' opinions. The ACFTU had previously signed an agreement with the company in 2006 that allowed Walmart to set up management-controlled unions instead. The union asked for the workers to return to their jobs.
Reuters reported that by July 8, 2016, the striking workers returned to work when management agreed to consider their protests. Later it was reported that
OUR Walmart provided strategic advice to the Walmart Chinese Workers Association (WCWA) prior to the strikes in China. In January 2018, Walmart announced the increase of the minimum wage for its U.S. employees to $11 per hour.
Working conditions Walmart has faced accusations involving poor working conditions for its employees. For example, a 2005
class action lawsuit in
Missouri asserted approximately 160,000 to 200,000 people who were forced to work off-the-clock, were denied overtime pay, or were not allowed to take rest and lunch breaks. In 2000, Walmart paid $50 million to settle a class-action suit that asserted that 69,000 current and former Walmart employees in Colorado had been forced to work off-the-clock.
Oregon, and
Minnesota. Class-action suits were also filed in 1995 on behalf of full-time Walmart pharmacists whose base salaries and working hours were reduced as sales declined, resulting in the pharmacists being treated like hourly employees. Beginning in 2005, the class-action suit
Dukes v. Walmart Stores, Inc. was heard by the
United States Court of Appeals for the Ninth Circuit. In 2011, for the
U.S. Supreme Court case
Walmart v. Dukes, U.S. Supreme Court Justice
Antonin Scalia rejected Bielby's testimony, saying it was "worlds away" from proof. This marks the first time that Walmart had faced a worker-led revolt of such scale, according to both employees and the company. A 2004 report by
Democratic United States Representative
George Miller alleged that in ten percent of Walmart's stores, nighttime employees were locked inside, holding them prisoner. According to the
Times, the audit, "pointed to extensive violations of child-labor laws and state regulations requiring time for breaks and meals", including 1,371 instances of minors working too late, during school hours, or for too many hours in a day. Some critics said that Walmart directly hired undocumented workers, while Walmart says they were employed by contractors who won bids to work for Walmart. On October 23, 2003, federal agents raided 61 Walmart stores in 21 United States states in a crackdown known as "Operation Rollback", resulting in the arrests of 250 nightshift janitors who were undocumented. Following the arrests, a grand jury convened to consider charging Walmart executives with labor racketeering crimes for knowingly allowing undocumented workers to work at their stores. In November 2005, 125 alleged undocumented workers were arrested while working on construction of a new Walmart distribution center in eastern Pennsylvania. According to Walmart, the workers were employees of Walmart's construction subcontractor.
Allegations of wrongful termination On January 13, 2011, four employees at a Walmart in
Layton, Utah were confronted by a shoplifter who pulled out a handgun and took one of the employees hostage in an attempt to leave a small, closed office. The other three employees disarmed and subdued the shoplifter, and all four held onto the man until police arrived. A week later, the four employees were fired for violating a company policy requiring employees to "disengage" and "withdraw" from any situation involving a weapon. The four fired employees, together with two other Walmart employees who had been fired after subduing violent customers, sued Walmart in the United States federal court in June 2011. After the
Utah Supreme Court ruled (in response to a request from a federal judge) that Utah law prohibited the firing of workers for defending themselves from injury or death, Walmart and the workers settled the case on undisclosed terms. On July 9, 2013, an employee at a Walmart in
Kemptville, Ontario, confronted a customer who had left his dog locked in his truck with the windows rolled up. She called the police when the customer refused to solve the problem. She was fired later the same day, reportedly on the grounds of "being rude to a customer", after rejecting instructions from her manager that such incidents should be reported to the store management rather than directly to the police. The National Labor Relations Board (NLRB) has long had the goal of protecting workers, whether unionized or not, who engage in concerted activity by speaking with each other regarding conditions, wages, and/or benefits. The NLRB has recently stated that this also applies to social media. The key point is whether or not the intent appears to be to communicate with fellow employees. And Walmart's official policy is viewed as acceptable and not overly restrictive in this regard, revised in part after consultations with the NLRB. However, in practice, Walmart may not always follow such a policy. For example, a September 2013 article in
The Atlantic Wire, reports the case of a 17-year veteran of Walmart's Paramount, California location who started at $5.50 an hour as an overnight stocker and became a manager in housewares. "For 14 years I was a model associate", he states. In 2012, he became increasingly involved with OUR Walmart and was fired in May 2013. He reports that after he began speaking about labor conditions "they started silencing me, by holding me to standards that they weren't holding other associates to. We were so understaffed, and the workload placed on me [was] unsurmountable." In 2017 Walmart released a wig to their website that was described with a
racial slur as the wigs shade of brown on the website. This sparked lots of criticism and controversy on Twitter for being racist. Walmart made the item unavailable shortly after the controversy started.
Health insurance According to a September 2002 survey by the state of
Georgia, one in four children of Walmart employees were enrolled in PeachCare for Kids, the state's health-insurance program for uninsured children, compared to the state's second-biggest employer,
Publix, which had one child in the program for every 22 children of employees. A December 2004 nationwide survey commissioned by Walmart showed that the use of public-assistance health-care programs by children of Walmart workers was at a similar rate to other retailers' employees, and at rates similar to the United States population as a whole. As of October 2005, Walmart's health insurance covered 44% or approximately 572,000 of its 1.3 million United States workers. In comparison, Walmart rival and wholesaler
Costco insures approximately 85% of its workers. In 2003 Walmart spent an average of $3,500 per employee for health care, 27% less than the retail-industry average of $4,800. When asked why so many Walmart workers choose to enroll in state health care plans instead of Walmart's own plan, Walmart CEO
Lee Scott acknowledged that some states' benefits may be more generous than Walmart's own plan: "In some of our states, the public program may actually be a better value – with relatively high income limits to qualify, and low premiums." Critics of Walmart say in
Walmart: The High Cost of Low Price that employees are paid so little they cannot afford health insurance. On October 26, 2005, a Walmart internal memo sent to the firm's board of directors advised trimming over $1 billion in health care expenses by 2011 through measures such as attracting a younger, implicitly healthier work force by offering education benefits. The memo also suggested giving sedentary Walmart staffers, such as cashiers, more physically demanding tasks, such as "cart-gathering", and eliminating full-time positions in favor of hiring part-time employees who would be ineligible for the more expensive health insurance and several policy proposals which may violate the
Americans with Disabilities Act of 1990. Walmart, with about 17,000 employees in Maryland, was the only known company to not meet this requirement before the bill passed. On July 7, 2006, the Maryland law was overturned in federal court by a United States District judge who held that a federal law, the
Employee Retirement Income Security Act (ERISA),
preempted the Maryland law. The judge said the law would "hurt Walmart by imposing the administrative burden of tracking benefits in Maryland differently than in other states." On April 17, 2006, Walmart announced it was making a health care plan available to part-time workers after one year of service, instead of the prior two-year requirement. By January 2007, the number of workers enrolled in the company's health care plans increased by 8%, which Walmart attributed to the introduction of less expensive insurance policies. However, even with this increase, less than half of Walmart's employees, or 47.4%, received health insurance through the company, with 10%, or 130,000, receiving no coverage at all. After a wave of bad publicity, Walmart dropped its suit. In 2011, Walmart stopped providing health insurance for part-time employees working under 24 hours per week. In 2013, health insurance benefits will not be available to employees who work fewer than 30 hours per week. Experts in labor and health care observed that the change will shift the burden of providing health care for Walmart employees to the federal government, as eligibility for
Medicaid has been expanded under the
Patient Protection and Affordable Care Act (PPACA or ACA). An analysis of Walmart's health plans as compared to plans offered in the ACA's
health insurance marketplaces found that Walmart's plans have larger networks of providers than most plans in the marketplaces, and that gross premiums (before accounting for tax credits) are less expensive under Walmart's plans. In October 2014, Walmart announced that they were cutting benefits for all associates working under 30 hours a week, which is said to affect roughly 30,000 (2%) of Walmart's workforce. The company acknowledged a $500 million jump in health care expenses as the primary reason for their decision. Walmart executive Sally Welborn stated in a blog post, "This year, the expenses were significant and led us to make some tough decisions as we begin our annual enrollment."
Labor union opposition Walmart has been criticized for its policies against labor unions. Critics blame workers' reluctance to join the labor union on Walmart anti-union tactics such as managerial surveillance and pre-emptive closures of stores or departments who choose to unionize. Walmart claims that it is not anti-union but "pro-associate", arguing that its employees do not need to pay third parties to discuss problems with management as the company's open-door policy enables employees to lodge complaints and submit suggestions all the way up the corporate ladder. In 1970, Walmart's late founder
Sam Walton resisted a unionization push by the
Retail Clerks International Union in two small
Missouri towns by hiring a professional
union buster to conduct an anti-union campaign. On the union buster's advice, Walton also took steps to show his workers how the company had their best interests in mind, encouraging them to air concerns with managers and implementing a profit-sharing program. Walmart said that the nationwide closing of in-store meat packaging had been planned for many years and was not related to the unionization. Walmart's anti-union policies also extend beyond the United States. The documentary
Walmart: The High Cost of Low Price, shows one successful unionization of a Walmart store in
Jonquière, Quebec, Canada, in 2004, but Walmart closed the store five months later because the company did not approve of the new "business plan" a union would require. In September 2005, the Québec Labor Board ruled that the closing of a Walmart store amounted to a reprisal against unionized workers and has ordered additional hearings on possible compensation for the employees, though it offered no details. In March 2005, Walmart executive
Tom Coughlin was forced to resign from its board of directors, facing charges of
embezzlement. Coughlin said that the money was used for an anti-union project involving cash bribes paid to employees of the
United Food and Commercial Workers Union in exchange for a list of names of Walmart employees that had signed union cards. Walmart has also had some run-ins with the German
Ver.di labor union as well. These issues, combined with cultural differences and low performing stores, led Walmart to pull out of the German market entirely in 2006. In August 2006, Walmart announced that it would allow workers at all of its Chinese stores to become members of trade unions, and that the company would work with the state-sanctioned
All-China Federation of Trade Unions (ACFTU) on representation for its 28,000 staff. However, the All-China Federation of Trade Unions has been criticized because it is the only trade union in China and as a tool of the government, ACFTU has been seen as not acting in the best interest of its members (workers), bowing to government pressure on industry growth and not defending workers' rights. In November 2012, the
United Food & Commercial Workers joined with several Walmart workers with a plan to go on strike on
Black Friday at several stores nationwide in protest to low pay, an increase in
health insurance premiums, and not being given the option to have the day off or having
Thanksgiving off. Walmart has countered this by saying that the strike is illegal due to the union not being sanctioned by the company, and that the striking workers are a small minority of the company's workforce, with the vast majority of workers willing and ready to work the retail industry's busiest day of the year. In May 2013, Walmart employees associated with a union-backed labor group called
OUR Walmart began what it says will be the first "prolonged strikes" in Walmart's history. For Thanksgiving 2013, CNN estimates that approximately a million United States Walmart employees would work over the course of the holiday, with big specials starting at 6:00 pm on Thanksgiving Day. The company stated that employees would receive "a nice Thanksgiving dinner at work", extra "holiday pay", and 25% discount off one purchase, regardless of how many items are purchased at that time. According to the
Cleveland Plain Dealer, the extra holiday pay equaled the average daily shift the employee worked during the previous two weeks. Walmart would also expand its one-hour guarantee from three items the year before to twenty-one items. This means that a customer standing in line for such an item from 6–7 pm or from 8–9 pm would be guaranteed to get it at that price some point before Christmas. In July 2019, the Walmart
subreddit was flooded with pro-union memes in a protest to the firing of an employee who posted confidential material to the subreddit. Many of these posts were angry with Walmart surveying its staff on the Internet. The posting of the union content is in a response to the aforementioned alleged anti-union position Walmart has taken in the past.
Surveillance patent In July 2018, Walmart was granted a patent titled "Listening to the Frontend" for audio surveillance technology that could allow it to record employees as well as its shoppers. The company says the technology could help it boost worker productivity by generating performance metrics for each employee based on cashier area sounds, such as checkout scanner beeps, and even conversations. It would not say whether it plans to actually implement the multi-sensor system.
Gender and sexual orientation In 2007, a
gender discrimination lawsuit,
Dukes v. Walmart Stores, Inc., was filed against Walmart, alleging that female employees were discriminated against in matters regarding pay and promotions. A
class action suit was sought, which would have been the nation's largest in history, covering 1.5 million past and current employees. On June 20, 2011, the
United States Supreme Court ruled in Walmart's favor, stating that the plaintiffs did not have enough in common to constitute a class. The court ruled unanimously that because of the variability of the plaintiffs' circumstances, the class action could not proceed as presented, and furthermore, in a 54 decision that it could not proceed as any kind of class action suit. Several plaintiffs, including the lead plaintiff, Betty Dukes, expressed their intent to file individual discrimination lawsuits separately. According to a consultant hired by plaintiffs in a sex discrimination lawsuit, in 2001, Walmart's EEOC filings showed that female employees made up 65 percent of Walmart's hourly paid workforce, but only 33percent of its management. Just 35 percent of its store managers were women, compared to 57 percent at similar retailers. In 2007, Walmart was named by the National Association for Female Executives as one of the top 35 companies for Executive Women. Walmart's rating on the
Human Rights Campaign's
Corporate Equality Index, a measure of how companies treat
LGBT employees and customers, has increased greatly during the past decade. The company was praised for expanding its anti-discrimination policy protecting gay and lesbian employees, as well as for a new definition of "family" that included same-sex partners. However, they have been criticized by the HRC in other areas, such as not renewing its membership in the National Gay and Lesbian Chamber of Commerce. In January 2006, Walmart announced that "diversity efforts include new groups of minority, female and gay employees that meet at Walmart headquarters in Bentonville to advise the company on marketing and internal promotion. There are seven Business Resource Groups: women, African-Americans, Hispanics, Asians, Native Americans, Gays and Lesbians, and a disabled group." == Poorly run and understaffed stores ==