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Working For Wal-Mart, Part Two

By Kevin Robinson in News on Mar 12, 2010 6:20PM

Entrance to a Wal-Mart Supercenter, by Ron Dauphin.

As part of our on-going coverage of Wal-Mart’s attempt to break into the Chicago retail market, we take a look today at the company’s employment practices in the Chicago metropolitan area. Chicagoist met up with three Wal-Mart employees to talk to them about their jobs, company policy, and why they work there. Check out part one of this series, posted March 10.

Cutting costs in Wal-Mart’s stores isn’t limited to reducing the workforce available on a shift and slashing hours to prevent overtime. Earlier this year the company announced that it would be outsourcing in-store product demonstrations at Sam’s Clubs to a third-party contractor, cutting about 10,000 jobs.

Rosetta Brown works in a Sam’s Club, and knew some of the product demonstrators that were terminated. “We lost ten ladies that all had 10 years, 15 years, 18 years. And now they got a new company that came in. They fired those ladies on Sunday, on Monday I met the new supervisor for demos, they bringing an outside company in to do their job. Eleven dollars an hour, six hours a day, for five days a week. Less hours, less money. And all them ladies was making 15, 18 dollars an hour. And they got rid of all of them. They was crying to me, so hard. They worked Saturday, told them to come in early Sunday, and they fired them.” Linda Haluska also told me about how Wal-Mart fires employees on a regular basis. “There’s a lot of workers at our store that have been with the company for more than a year. And I think they want to bring in new people, because a lot of people that have been there are getting paid pretty decent money. If you’ve been there for at least 10 or 15 years, you’re making more than 10 bucks an hours. By bringing somebody in that’s right off the street new,” they make less money.

Rosetta and Linda have been with Wal-Mart for years, earning pay raises and taking on challenging new experiences within their stores. But not all of Wal-Mart’s employees have that opportunity. That’s because, according to Linda and Rosetta, the stores will “clean house” with a round of terminations. Sometimes the firings appear to be a business decision, as in the case of the in-store product demonstrators. In other cases, Wal-Mart managers will begin an internal process to terminate an employee, based on productivity or scores on an annual performance review. Linda told me about a stocker in the frozen foods department that had been fired over productivity. “Now, to do freezer-cooler, that’s a pretty hard job, that’s three pallets of frozen food a night.” The job requires employees to work in commercial-grade freezers, unloading and organizing inventory. The store’s assistant manager accused the stocker of not being productive. “He was coached over it, he was accused of having no productivity. And he was fired,” Linda tells me. Why do you think he was fired? "I think he [the manager that fired the stocker] was convinced to do that by the assistant manager."

Terminating employees with some longevity saves the company money not just because it reduces wages, but also because Wal-Mart has found that bringing younger, healthier workers into the company can save money on benefits. In a memo leaked to the press in 2005, a strategy of eliminating veteran employees and bringing in younger, healthier employees that would use less health care was revealed. "It will be far easier to attract and retain a healthier work force than it will be to change behavior in an existing one," the memo reads. "These moves would also dissuade unhealthy people from coming to work at Wal-Mart."

A grocery cooler in Wal-Mart, by ratterrell.
Raises at Wal-Mart are tied to an employee’s performance appraisal - if an employee does well, they’re eligible for a raise; if not, the pay increase is reduced, if granted at all. “There’s employees there seven years, when I’d only been there two, still making $7.50,” Roslyn Landfair tells me. Linda adds, “They give it to who they want to. In fact, ever since I’ve worked there [four years],I’ve always gotten the full sixty-cent raise, every single time.”

But Linda experienced management's alleged fickle nature first-hand at her most recent review; she was told that she wouldn't get the full sixty-cent raise because of tardiness. “He [her manager] told me all my strengths and all my weaknesses, and that I exceeded his every goal, and said that I don’t need to be supervised because I’m a good worker, and he tells me what all my weaknesses are, and he says to me that he was going to give me the full review, but that I don’t know how to do inventory management. I told him ‘But I do know how to do inventory management’. He says, ‘Oh yeah, that’s right!’ He didn’t say anything. But then he says ‘Well, I want to talk to you about your absenteeism.’ I says ‘What are you talking about?’ He says ‘You have three absences and four tardies.’ I says ‘No I don’t, there’s no way I could have.’ He says, ‘Let’s look at the computer.’ And I says ‘Let’s do that.’”

Linda and her manager went to the computer that tracks employee clock punches. She explained to me Wal-Mart’s policy for clocking in: if you punch in within 15 minutes of your scheduled shift, you’re considered on time. Three lates is an absence. In order for the system to work right, however, the manager has to make sure that he codes the clock punches correctly when they’re uploaded into they system. Linda pointed out to the manager that the punches he was referring to as tardies were coded incorrectly. After she pointed that out to him, he told her that she had a no call-no show on September 2nd. “I knew that was a Tuesday or a Wednesday, and I’m always scheduled off on all Tuesdays and Wednesdays. I says ‘how can I have a no call-no show when I’m scheduled off on Tuesdays and Wednesdays?’ He stared at the computer. They were screwing with me.”

A cosmetics aisle in Wal-Mart, by Clean Wal-Mart.
Low costs, both for suppliers and employees, aren’t the only way that Wal-Mart generates revenue. Rosetta and Linda told me about the large profits Wal-Mart has seen thanks to the Illinois Link Card. The Link program is Illinois’s Food Stamps program, and it works like a debit card: benefit recipients swipe the card at the register to pay for food purchases. Wal-Mart has recently begun accepting the Link card at its retail locations that sell groceries. Rosetta’s store in Cicero has had a successful run with the Link program: the store did a million dollars in business with the state’s food stamp program on the first day of March.

Shoppers that use their Link card at Wal-Mart include many Wal-Mart employees, which isn’t surprising, given that a large number of them are on public aid. The women claim the company purposely cut workers' hours (and therefore their pay) so workers can remain eligible for the Link card, creating a cycle for the store of less pay to employees and more profits thanks to the Link card usage - the logic being that the employees will buy groceries in their own store rather than go to a competing store. Rosetta told me, “There’s a lot of workers on Link. They [the company] cut their [workers'] hours, because they know when they cut their hours their check stubs is lower. And every time you take your check stubs in to the public aid office you get more food stamps if you got less hours. Then they turn around and spend the Link card in Sam’s Club.”

While there's admittedly only anecdotal evidence to support this alleged exploitation of Illinois's Link program and Wal-Mart is one of many large grocery chains that accepts the Link card, reports and research in other states demonstrates that the corporation does have a history of employing more workers dependent on state welfare programs than other chains. Reliable numbers on the company's profitability from it's employees using public assistance programs are hard to come by, but a look at data reports from other states indicates that public assistance to Wal-Mart employees isn't an uncommon phenomena.

A study by the University of California Berkley's Labor Center found that a disproportionate number of the mega-retailer's employees rely on the state's public health programs, compared to other retail workers. The previously mentioned internal company memo, (PDF here) reported by the New York Times, validated UC Berkley's findings (PDF here). More specifically, a recent study conducted by the state of Massachusetts found that Wal-Mart topped their list of companies with 50 or more employees using publicly subsidized care (PDF here) with a total of 40 percent of their employees in the state relying on state aid for health care. And the company topped a similar 2004 study in Washington state which found that nearly 20 percent of Wal-Mart employees received state-subsidized health coverage, either through Medicaid or the state's Basic Health Plan, more than twice that of competitor Safeway, who at the time employed roughly the same number of employees in the state as Wal-Mart.

I asked the women if they knew workers that are on Link. “Yeah!” both Rosetta and Linda replied. “Everybody got Link,” says Rosetta. “They sell it to each other in the store. They sell the Link card to the ones that don’t have it. All the workers got the Link card, mostly."

In part three on Monday, we’ll look at how Wal-Mart keeps their employees from unionizing, and why people stay.