Walmart's everyday low wages

October 18, 2012 

Workers in more than a dozen cities went out on strike last week against Walmart. Those walkouts followed strikes at nine Los Angeles-area stores the week before — the first ever by direct employees of the retail giant — and work stoppages over the last month by warehouse workers in California and Illinois. The protests, however, may just be beginning: Walmart workers have threatened further strikes for Black Friday, the most lucrative day of the year for retailers.

The workers are protesting abusive conditions throughout Walmart's supply chain — from the workers who process seafood sold in its stores, to the warehouse workers who ferry Walmart goods from suppliers to customers, to its cashiers and other store employees. The workers aren't all directly hired by Walmart. But whether they're direct hires, subcontracted, or temporary hires, they all labor at breakneck speeds to maximize Walmart's profits, and at a tremendous cost to the workers, their families and communities.

Walmart's sheer size and market dominance have enabled it to drive down its direct labor costs. And by squeezing contractors to keep their costs as low as possible, it creates a dynamic that fosters workers' rights violations throughout its vast network of contractors and subcontractors.

Workers are hit hard by Walmart's practices. Low wages and unpredictable schedules, often far less than the full-time hours workers want, combine to keep them in poverty. A 2011 study found that Walmart employees earn approximately 12 percent less than retail workers overall, and more than 14 percent less than workers in other large retail establishments. In numerous states, Walmart tops the list of companies with employees on public assistance, even after the company rolled out its much-publicized (if largely unaffordable) health-care plan.

Sometimes workers don't even get the meager wages they've earned, as when they're forced to continue working after they've officially clocked out for the day, or receive their paychecks late or with some of their wages missing. Workers paid according to complicated piece-rate systems sometimes don't even wind up making the minimum wage. Workers have also complained about hazardous working conditions, with temperatures in the warehouses reaching well over 100 degrees at times, and workers driven to unload 250-pound boxes at a dangerously fast pace.

The poor conditions that typify Walmart work and that are at the heart of these strikes are becoming all too common in the low-wage jobs, including retail, that are dominating the recovery. A 2008 study of low-wage workers in a range of jobs in Chicago, Los Angeles and New York, for example, found that 26 percent were paid less than the minimum wage, 76 percent were underpaid or not paid at all for their overtime hours, and 70 percent worked off the clock before or after their shift. Workers were robbed an average of $2,634, or 15 percent, of their annual earnings.

Walmart's model may play a role in driving these trends. The corporation has moved aggressively to dominate the retail and, more recently, grocery markets, forcing competitors to scramble to match Walmart's “everyday low prices.” Some supermarket chains have either yielded to Walmart and abandoned the market, or have themselves adopted its practices and attempted to lower wages and benefits.

This series of strikes, however, wasn't prompted by workplace conditions alone, as bad as they are. The strikers are not only subject to repeated abuse at the workplace, but are consistently harassed when they try to do something to remedy the situation. Managers have threatened, suspended and even fired workers who made complaints. It's this harsh retaliation that prompted the strikes.

The workers' vulnerability makes this recent wave of strikes all the more remarkable. None of the strikers are unionized, and they aren't demanding union recognition or a contract. Walmart has tried almost every tactic, legal and illegal, to block unionization efforts and has been successful so far. Workers have filed lawsuits to reclaim unpaid wages and reached out to government agencies that deal with workplace issues, like state and federal Departments of Labor, the Occupational Safety & Health Administration, and the National Labor Relations Board. But the courts move slowly, penalties are insufficient to deter violations, and enforcement agency staff are at some of the lowest levels in decades.

In the face of these challenges and a fierce backlash, the workers are simply reclaiming the right to speak out against the abuses they experience with one of the few — and most powerful tools they have. And so far, they're making tremendous progress. The strikers at a warehouse outside Chicago went back to work with their jobs intact and with pledges from their employer to end illegal retaliation. They even got paid for the days they were out on strike.

The workers' courage and their victory represent some of the brightest hope for challenging the downward tide in job quality we've witnessed over the past decades. This is not to say that there's no movement aimed at fixing the problems at the heart of the Walmart strikes; there is. Proposed bills in Congress would raise the federal minimum wage to $9.80 by 2014 and also raise the tipped worker wage. Agendas for overhauling the NLRA, which protects workers' right to organize and bargain collectively, and OSHA, to preserve worker health and safety, are in development.

And to address the problems warehouse and other Walmart supply chain workers have had in getting any entity held accountable, a proposed law in California would make firms liable for minimum wage and overtime violations by their subcontractors.

While these legislative and regulatory efforts percolate, we need someone on the ground fighting to show us what's at stake and where our jobs are heading without significant reform. At great personal risk, the Walmart strikers have taken a huge step toward challenging the “Walmartization” of our economy, ultimately improving the quality of our jobs, boosting the economic recovery, and improving conditions for all workers.

Owens is executive director of the National Employment Law Project.

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