Commentary

Up Against the Wall

Wal-Mart has a new jingle, but workers are hearing the same old song

  kvb208@nyu.edu

Wal-Mart may have revised its lyrics, but the world’s largest corporation is still humming the same old tune — and everyone who works or shops there has to keep dancing to it.

After 19 years, the world’s largest company intends to drop its “Always Low Prices” slogan and happy face in favor of the more market-friendly “Save Money. Live Better.” In a press release for the new campaign, the company predicted that the new, warmer tone in its advertising would boost sales. No longer will Wal-Mart’s TV ad-campaigns feature that hyperactive smiley-face running up and down the aisles, keeping prices “rolling, rolling, rolling.”

Frugal customers fret not; Wal-Mart assures devotees that bargains are still the name of its game. Its campaign even features “customers” (actually, actors) elated over how Wal-Mart helped them save money during the oil crisis. And the company says its next batch of ads will show families how saving money on the little things adds up, and therefore helps them live better.

Wal-Mart execs certainly practice what they preach: penny pinching on labor abroad, especially in China, and paying low, part-time wages to employees here. By pinching the pennies going out, and embracing all the dollars flowing in, the suits are themselves very likely “Living Better.”

Thrifty Wal-Mart CEO and Executive, H. Lee Scott, Jr., for example, banked a stock bonus worth $22 million on top of his $15.7 million earnings in 2006 (the average U.S. CEO earned a mere $9 million).

But there are no such spoils farther down the Wal-Mart chain, where below-poverty-level wages are further depleted by hefty health care deductions. According to the company, the average employee’s pay is under $10 an hour. And many workers are getting even less. In 2005, Wal-Mart reported that its average full-time “associate” earned $9.68 an hour, and worked 35 hours a week, for an annual before tax wage $17,617.60. In 2005, according to the Economic Policy Institute’s “Basic Family Budget Calculator,” the average two-person American family needed $27,948 just to meet basic needs. In fact, last year Wal-Mart announced plans to reduce the size of its of full-time work force and institute wage caps, offering one-time compensations of $200-$400 for future wage losses. Part-timers have to wait a year before they can enroll in the company’s health plan (the average national waiting period for part-time employees is about three months), and the Wal-Mart health plan is costly — in 2005 the average $17,000 employee would have had to spend between 5 and 7 percent of his or her income to cover premiums and deductibles. That same year, CEO Lee himself suggested that the healthcare was unaffordable. “In some of our states,” Lee stated, “the public program may actually be a better value — with relatively high income limits to qualify, and low premiums.”

And let’s not forget the complaints about the work environment, for which Wal-Mart has yet to offer a strategy for improvement. In December 2005, a California court ordered Wal-Mart to pay $172 million in damages for failing to provide meal breaks to nearly 116,000 hourly workers as required under state law. The company has appealed. In 2006,Wal-Mart’s annual report stated that the company was still facing 57 lawsuits over wages and hours. Hundreds of Wal-Mart employees have been willing to testify that they’ve had to work overtime or through meal periods without pay so the stores’ customers could lead “better lives.” In 2003, an Oregon a jury ordered Wal-Mart to compensate 140 employees in 18 stores for hours worked without pay; similar suits are underway in New York and Washington.

Wal-Mart is, without question, a convenient and cheap place to shop. If only it were a better place to work.

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