Responding to long-term pressure on insufficient employee wages and hours, Wal-Mart Stores, Inc. has announced that it will be raising its wages and give workers more predictable work hours. The announcement has reignited the debate about increasing the Federal minimum wage. Opponents to an increased Federal minimum wage say that Wal-Mart’s actions prove that the market can take care of itself. Others show that Wal-Mart is just an example, and others should be brought to follow suit.
For years, employees have accused Wal-Mart of having poor wage and hour polices. Wal-Mart stores generally had hundreds of part-time employees who would only be given a handful of hours a week, forcing individuals to take on second and third jobs, and making them ineligible for benefits. Employees also complained that the wages were insufficient and unsustainable. Reports show that although Wal-Mart employs more people than any other company in the United States, the majority of its employees with children live below the poverty line. On average, Wal-Mart employees take home $250 a week. When examined closely, this pay scale amounts to a form of corporate welfare. For example, the majority of Wal-Mart employees’ children qualifying for free lunch at schools. Essentially, the taxpayers were subsidizing the low salaries of Wal-Mart employees.
Wal-Mart’s President and CEO, Doug McMillon, made the announcement that the company will focus on improving the working experience for its 500,000 hourly employees in a statement released by the company. Wal-Mart will adopt comprehensive changes to its hiring, training, compensation, scheduling programs, and store management structure. These changes are being made so that employees will have the opportunity to earn higher pay and advance in their careers.
The company plans on spending $1 billion this year to put this plan into action. Hourly workers will earn at least $9 an hour, which is $1.75 above the current Federal minimum wage. By 2016, hourly workers will earn at least $10 an hour.
White House officials believe there is still a need for legislation that would raise the national minimum wage to $10.10 an hour.