Monday, February 28, 2005

About Wal-Mart

Three articles about Wal-Mart's employment practices.

In At a Small Shop in Colorado, Wal-Mart Beats a Union Once More, Steven Greenhouse (NYT) describes a recnet unsuccesful organizing drive at the tire-and-lube shop at a Wal-Mart store in Loveland, Colorado.  Among other very interesting issues, the article describes how some employees who initially signed authorization cards, voted against the union following Wal-Mart's campaign against the union.

Alicia Sylvia, a single mother of 10-year-old twins, was a big union booster at the outset.

"Compared to other stores, we don't even make what cashiers make," said Ms. Sylvia, who earns just under $9 an hour writing up service orders as cars arrive at the garage and says she cannot afford Wal-Mart's health insurance. In Colorado, full-time unionized supermarket cashiers generally earn $15.66 an hour after two years.

"We should make more, since we work on vehicles and can get burned, and we have to stand out in the cold and heat," she said. "If you're working 10-hour days in the rain and getting your pants wet and freezing all day, it's not fun."

She acknowledged that the antiunion videos had helped turn her against unionizing.

"I really wish Wal-Mart would become better," she said. "But even if we get a union, it will be a long battle. Wal-Mart doesn't have to agree to anything. The message we got was, 'You're a small bunch of guys, and you can stand out there and strike, and we're going to replace you.' They'll never agree to a contract, out of pure stubbornness. I'm so confused."

In the Wal-Mart Manifesto, Timothy Noah (Slate .com) debunks Wal-Mart's CEO (H. Lee Scott Jr.) recent speech in which Lee argues that Wal-Mart is good to its employees.

"What's fairly new in Scott's speech (a related ad campaign was launched last month) is Wal-Mart's rising on its hind legs to tell the world that it is good to its employees. I'd thought it was a settled matter that Wal-Mart had achieved its miraculously low prices by squeezing its employees. Not so, said Scott:

Wal-Mart's average wage is around $10 an hour, nearly double the federal minimum wage. The truth is that our wages are competitive with comparable retailers in each of the more than 3,500 communities we serve, with one exception—a handful of urban markets with unionized grocery workers. … Few people realize that about 74 percent of Wal-Mart hourly store associates work full-time, compared to 20 to 40 percent at comparable retailers. This means Wal-Mart spends more broadly on health benefits than do most big retailers, whose part-timers are not offered health insurance. You may not be aware that we are one of the few retail firms that offer health benefits to part-timers. Premiums begin at less than $40 a month for an individual and less than $155 per month for a family.

The apparent purpose of the speech was to counter political resistance to the building of Wal-Mart "supercenters" in California. But if Scott saw much danger that Wall Street might believe his rosy picture of labor relations, he wouldn't paint it, because that would create an investor stampede away from Wal-Mart stock. What we have, then, is a unique rhetorical form: Nonsense recited by someone who is relying on most of his listeners to understand that he is spouting nonsense. Wal-Mart took the trouble to send this speech out to writers "who are in a position to influence a lot of others," according to a cover e-mail I received from Mona Williams, Wal-Mart's vice president for corporate communications. I took Williams' email as a plea to expose the dishonesty in Scott's remarks (Stop us before we kill again!) disguised as a plea to give Scott's remarks a fair hearing. I will try to oblige."

Finally, Robert B. Reich (ex-Secretary of Labor) argues that we should stop blaming Wal-Mart and instead look at ourselves for Wal-Mart's employment practices ("Don't Blame Wal-Mart").  According to Reich,

"But isn't Wal-Mart really being punished for our sins? After all, it's not as if Wal-Mart's founder, Sam Walton, and his successors created the world's largest retailer by putting a gun to our heads and forcing us to shop there.

Instead, Wal-Mart has lured customers with low prices. "We expect our suppliers to drive the costs out of the supply chain," a spokeswoman for Wal-Mart said. "It's good for us and good for them."

Wal-Mart may have perfected this technique, but you can find it almost everywhere these days. Corporations are in fierce competition to get and keep customers, so they pass the bulk of their cost cuts through to consumers as lower prices. Products are manufactured in China at a fraction of the cost of making them here, and American consumers get great deals. Back-office work, along with computer programming and data crunching, is "offshored" to India, so our dollars go even further.

Meanwhile, many of us pressure companies to give us even better bargains. I look on the Internet to find the lowest price I can and buy airline tickets, books, merchandise from just about anywhere with a click of a mouse. Don't you?

The fact is, today's economy offers us a Faustian bargain: it can give consumers deals largely because it hammers workers and communities."

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