Wal-Mart is a multi-national retail corporation based in Bentonville, Arkansas in the USA. With over 500 billion dollars in revenues, it is the world’s biggest retailer company and also happens to be the largest private employers with a total of 2.3 million employees. Wal-Mart operates hypermarkets, discount department stores, and grocery stores. Additionally, it runs 11,718 stores in 28 countries globally and operates under 59 different names. Despite the tremendous success and high annual returns, Wal-Mart has been involved in numerous cases regarding poor employee treatment, low wages, failure to provide health insurance, and discrimination of employees. It has also been accused of evading and discouraging its employees from forming or joining unions to continue its oppressive practices. In general, the company has failed to adhere to the international standards of employee treatment, and this is evident through the many lawsuits filed against it as well as the frequent workers’ strikes.
Discussion
Over the past few years, Wal-Mart has increased its part-time workers and reduced full-time employees to cut expenses. Currently, part-time workers account for half of the workforce, and this represents an increase from 20 per cent in 2005 (Adams, 2014). Although most of its employees prefer to work as full-time employees, the company has continued to implement policies that support part-time employment; in 2016, it introduced a new scheduling system where employees are rotated randomly, thus abolishing the practice of employees working at specific hours. Accordingly, most employees are working for relatively fewer hours which has led to a decrease in their earnings. A survey conducted by Organization United for Respect (OUR) noted that most employees were affected significantly. The survey also showed that 55 per cent of the part-time employees do not have sufficient food to meet their basic needs (Bank Muñoz, 2018). This has been one of the main reasons the employees have continued to show dissatisfaction through strikes.
As mentioned before, Wal-Mart has in several occasions acted against its employees joining labor unions; a case at hand is when workers at a store in Quebec formed a union to campaign for higher wages and medical insurance. In response, Wal-Mart announced that it would close the store for economic reasons (Gall, 2017; Zieger, 2013). However, labor unions claimed that the underlying reason behind the closure was to suppress the union. Accordingly, the Quebec Labor Relations Board rejected Wal-Mart’s decision and termed the closure illegal. Notably, employees of Wal-Mart tend to organize non-union groups as a channel to air their grievances, and although they have faced similar challenges as unions, they have achieved relative success. For instance, employees from Central Florida formed a group (Wal-Mart Workers Association) to demand a pay rise and better working conditions. Thus far, they have overseen the reinstatement of a fired employee, restoration of hours cut, and installation of bike racks.
Wal-Mart is accused of exploiting its employees in foreign countries, and this has seen the company face several lawsuits. A prominent case in this regard concerns the Chinese employees who engaged in mass action after the company introduced the new scheduling system that allegedly saw employees working for longer hours for less pay. The employees believed that the system is a preparation for future layoffs, and this has put them in a situation of uncertainty about their jobs (Chan, 2017). Further, The International Labor Rights Fund filed a lawsuit against the company on the accusations that it denied minimum wage, punished union activities, and enforced overtime on the employees in foreign countries. In another instance, Wal-Mart was facing a lawsuit in California for failing to provide a mandatory lunch break for employees who work for more than six hours. The trial ended in the company compensating its employees a total of 172 million dollars.
In 2017, Wal-Mart introduced an affordable health care plan for all its employees that included monthly premiums of 11 dollars (Borrescio-Higa, 2015). Although the plan looked employee-oriented from the face of it, it has been accused of providing cheap medical care at the expense of quality. Later, an internal memo from an executive of the company was made public; it noted that the employees of Wal-Mart tended to be sicker than the national population, and it went ahead to propose recommendations to reduce healthcare spending. The recommendations included; putting health care clinics in Wal-Mart stores, reducing 401 (k) contributions, discouraging unhealthy workers from working in its stores, and hiring more part-time workers. An implementation of the mentioned recommendations would see the company save up to 1 billion dollars in a year. Seemingly, the company is more focused on increasing its revenues at the expense of quality health care of its employees.
On several occasions, Wal-Mart has engaged in legal tussles with the US National Labor Relations Board (NLRB) for going against workers’ rights and failing to comply with policies that protect the workers. For example, NLRB sued the company in 2014 for firing workers who went on strike on account of low wages (Kheel & Board, 2016; Wood, 2015). The strike involved workers from California, Texas, Washington, Kentucky, and other regions of the country. The NLRB also sued Wal-Mart for threatening employees with reprisal if they went on strike, in addition to terminating more than a 100 employees who engaged in strikes. The numerous lawsuits by the government through NLRB prove the extent of workers’ rights violations by Wal-Mart.
Wal-Mart has made various improvements (which have come in the wake of the numerous accusations of neglect) vis-à-vis enhancing employees’ conditions at the workplace. One notable change is the approval of Chinese employees to form unions as a way of allowing them to have a common voice. However, this move has been criticized as more inclined in maintaining good trade relations with China than improving employees’ working conditions. Nonetheless, it has worked to the advantage of the employees. Moreover, Wal-Mart has made efforts to crack down on workers’ rights violations and more so on child labor by increasing the rate of unannounced inspections at stores in foreign countries (Malloch, 2015). Such initiatives have resulted in fewer cases of workers’ rights violations.
Wal-Mart compensates its employees who are affected by tragedies as was seen during Hurricane Katrina in 2005. The company promised a job to all the displaced workers, in addition to providing them with enough supplies of food, shelter and other necessities (Brett Caraway, 2018). Wal-Mart has been hailed for its prompt responses in times of disasters and its generous contributions in the efforts to help people return to their normal lives. Moreover, the company has recently raised the starting wages by six per cent to stay competitive in the market. These among other initiatives geared towards achieving employee satisfaction have ensured that Wal-Mart remains competitive and profitable.
The management of Wal-Mart has always come out to defend the allegations against the company, claiming that Wal-Mart adheres to its policies of fostering good relations with its workers. Amid the strikes by workers in California, the former CEO of the company, Lee Scott said that the company is only interested in paying its workers and has introduced new policies to ensure that every employee receives a fair pay (Bank Muñoz, 2018; Leighton & Selekman, 2014). However, labor unions and societies that champion for the rights of the workers seem to think otherwise; they have accused Wal-Mart of undermining workers by paying low wages, providing poor working conditions, denying them their rights (for example to form unions), and introducing policies that are oppressive to the employees. The accusations have seen the company defend itself against lawsuits from the labor unions, non-union groups formed by the workers, as well as the government.
Conclusion
Wal-Mart is the biggest retailer corporation in the world with stores in 28 countries globally. However, it is often battling lawsuits from labor unions and employees for violating the rights of workers, child labor, low wages, and oppressive policies. For instance, it was involved in a legal battle with employees from Quebec and decided to close the store claiming economic concerns. Also, Wal-Mart has been accused of implementing policies that violate workers’ rights, for example, the 2016 scheduling system. Nonetheless, the company has worked to maintain a clean profile by compensating workers, providing aid in times of disasters, and increasing the starting wages of employees. However, it has to do more to change the world’s perspective on how the company handles its employees.
References
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Additional references
Kumar, R. (2017). Analysis of wealth—Walmart. Strategic Financial Management Casebook, 293-324. doi:10.1016/b978-0-12-805475-8.00010-0
This article provides more information on Wal-Mart and how it conducts its operations globally. According to the journal, Wal-Mart serves 260 million customers every week. It also informs on Wal-Mart’s business segments that consist of Wal-Mart US, Wal-Mart international, and Sam’s Club. It also includes employees’ experiences with the company
Logan, J. (2013). The Mounting Guerilla War against the Reign of Walmart. New Labor Forum, 23(1), 22-29. doi:10.1177/1095796013513435
The journal highlights the efforts of labor unions, community organizations, and group organizations to ensure that Wal-Mart ceases exploiting its employees and violating the rights of the employees. It indicates the labor organizations’ long term objectives in fighting Wal-Mart, and how it seeks to achieve employee satisfaction.
McGee, R. W. (2018). How Large is Walmart? A Comparison of Walmart Sales to Nation’s GDP. SSRN Electronic Journal. doi:10.2139/ssrn.3102735
Herein, the author compare Wal-Mart’s worth with other companies in same line of business as well as the national revenue. Also, he makes references to the earnings of the employees in comparison with the total revenue of the company. He concludes that in general, Wal-Mart ought to be paying the highest minimum wages in the US as it records among the highest profits globally.
